One of the most common questions we are asked by new clients is “How much should I spend on Google Ads?” – it is important to carefully set your Google Ads budget to avoid both over, and underspending.
To help with this there are some considerations that should be born in mind:
1. Don’t spend more than you can afford to lose
I know that sounds really pessimistic – bit it is realistic. Google Ads is tricky to get right. The first money you spend will struggle to wash its face, let alone make money. That’s just a plain truth. But it is invaluable in the learning process. What is working? What attracts the right kind of client? How much is it going to cost to land a paying customer? All of this is core to the optimisation process.
Working with a professional will help reduce the wastage, but there will still be some – it’s a question of how quickly you can learn and adjust your campaigns to improve the results which takes us nicely to….
2. Treat the first money you spend as market research
Even the best marketer cannot know exactly how a new campaign is going to perform. They will have a good idea, and will avoid a lot of the booby traps that are all over the Google Ads platform, but optimisation is an ongoing process – and sometimes the most obvious marketing targets prove to be less valuable as some slightly more hidden gems. A good account manager will identify opportunities others will never spot
3. Spend enough to generate traffic that can withstand some analysis
Until you have a foundation of a few hundred site visitors from your marketing efforts, any analysis will be meaningless. So if you try to draw conclusions from the behaviour of 10 site visitors, you’re going to make bad decisions. Let’s say that you can glean some important insights from 500 visitors. It is then a question of how long you are going to take to get those 500 visits. If your visitors cost $1 and you spend $100 a month it will take you 5 months before you can make any useful changes to your campaigns – and at that rate you might also find that seasonality impacts on the date to make it less useful. If, on the other hand, you spend $1,000 a month – you’re making useful adjustments in two weeks.
4. Spending too little can be worse than spending nothing
Without wishing to labour the point – if you don’t generate some minimal traffic volume you are never going to be able to make data driven improvements to your website. If you’re not ready to invest – then concentrate on your website’s performance with the traffic it does get and see if you can improve your conversion rate to a point where a minimal spend on Google Ads would make sense.
5. It’s a marathon, not a sprint
Over time you will be looking to optimise your campaigns to get a good return on your marketing investment. There isn’t a finish line – your market is evergreen and you will be serving existing, repeat and new customers as your business grows and your Google Ads campaign should grow and mature with you. You’re looking to find that sweet spot where your ad spend maximises it’s return on investment – and then keep it there as you expand your reach.
Hopefully, these guidelines will help you determine how much you should spending on your new Google Ads campaign. Once you start, the campaign itself will give you further guidelines as to how much additional traffic is available to you and you can increase your budget accordingly.