Keyword Bidding
Keyword Bidding Effectiveness
If your company is using paid listings in search engines to generate traffic to its website then you need to know how effective those keywords are. Effective keywords bring paying customers to your site not just casual visitors.
So how do you know which keywords are effective?
Advertisers can spent very large sums of money attracting people to their websites and whilst the overall number of visitors looks good, the number of paying customers may not. An effective keyword is one that attracts the right audience to your company site with the right offer to generate the right response. A keyword's effectiveness can be evaluated by looking for the following results:
- The overall number of visitors to the site that it generates,
- The percentage of visitors who spend time at your site and don't just leave straight away,
- The percentage of visitors who go on to identify themselves as a sales lead or become a customer.
Any effective keyword should have all three of these elements.
Effective PPC Bidding
In competitive areas companies often bid over $2 US per click for target keywords. Whilst this is still competitive with the costs of traditional direct mail there is still a significant potential for costs to blow out without implementing effective keyword bidding strategies. The fundamental issues are margins and conversion ratios. If your product or service does not have a sufficiently large margin to cover such high marketing costs, then you will make a loss on each sale, not good business unless you are deliberately taking a loss leader strategy to generate bigger sales later on. Your conversion ratios are also key to getting the best results. If you have to attract 100 people to your site to make one sale that is a 1% conversion rate (1/100) and at $2 per click it is going to cost you $200 to make that sale. Improve that conversion rate to 3 sales per 100 visitors then your cost to acquire each sale drops to around $66 per sale. Still high but far better than $200.
So how do you measure conversion rates? ClickTracks is an excellent product to determine the conversion rates for your site for each of your keywords that you are bidding on. You can measure your conversion rate by:
- Identifying how many people are visiting your site from your keyword campaigns using ClickTrack's campaign tool
- Identify the goals that you want these visitors to achieve, e.g. purchase or register
- Identify how many of these visitors achieved this goal using ClickTracks labelling feature
- Divide the number from item 3 by item 1 to get your conversion rate.
What next?
Either download an evaluation copy of ClickTracks or contact us for a free no obligation introductory discussion of how Panalysis can help you to achieve highly effective keyword bidding strategies.
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