Many businesses have traditionally in the past used paid search advertising as a tool to generate revenue & profit. This is especially true for those in product/e-commerce related businesses as many are well aware of margins, stock quantity and cost of sale. However e-commerce and in particular the marketing practice of SEO is becoming harder and harder. Yes many people have been saying this for years but it won’t take away the fact that even if you’ve been dead set on SEO as your main traffic driver you’ll certainly have to diversify.
Looking Past Just Profits When Using PPC
Many marketers look at paid search as a one off transaction. “Oh we made £1,000 in profit this month from PPC, good job!” when in reality it does a lot more than that. If you were given £1 million for free and spent it all on paid search in the space of 3 months (all relevant keywords) at a rate of around 33p a click then that would mean around 3 million people would be aware of your business. A certain percentage would bookmark the website, another portion would like/ follow you on social media and engage with you, a certain portion will give you their email address and the rest will probably do a brand search next time. This means that even if you weren’t profitable you’re building brand equity by making more people aware of your business and thus next time ‘potentially’ meaning they will remember you and search for your brand.
When you go into analytics, over time this should mean more brand searches, more social media & email followers as well as more direct traffic. Many businesses and brands are quite skeptical on the value of paid search, but even if you’re breaking even you may potentially be gaining something in return (a new follower, a new person that signs up to your newsletter).
Setting Secondary Analytics Goals
If you know you may be getting something else in return besides a sale from PPC, then wouldn’t it make sense to set up secondary goals? Of course it is. This way you can then work out the ‘real value’ of your paid search campaigns. Below are a few things you should be tracking as secondary goals:
- Social Followers
- Social Shares
- Email Signups
Now tracking other things such as direct traffic and brand traffic will be a little higher. However it means if you run quite a large Paid search campaign one month and the next month your direct and organic homepage traffic is up then it could be a cause of attribution.
The Importance Of Working Out The Lifetime Value Of A Customer
Besides working out secondary goals it will also help to understand the lifetime value of a customer. Doing so enables marketers and the business as a whole to acquire a new customer and thus price out the competitors when it comes to paid search. For example if your average profit per sale is £15 then many businesses won’t want to spend more than that to acquire them. However if you gather more data and find that over the course of their lifetime a customers real profit contributor to your business is £60 then it would make sense to spend up to 3x more to acquire a customer. In doing so you will be more competitive and make it hard for the competition to keep up with your customer acquisition efforts.