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Henry Ford once said, "Whether you think you can or you can't, either way, you're right." A hundred years later, that statement still applies in the global marketplace. As tough as things are these days, opportunities to grow still exist. You just have to believe you can succeed and be ready to embrace new ideas.
In the April 2009 issue of Franchising World, CCA Global's Chief Marketing Officer Dean Marcarelli pointed out that the Internet is the first place customers go to research a company. The Internet is rarely used by small businesses and for someone early to this opportunity, there is growth in spite of an economic downturn. The Internet provides franchise owners with a dizzying array of online options. You're forgiven though, if, while trying to grow 25-hours-a-day, eight-days-a-week, you don't have the time to research the next wave of online marketing tools. Marketers use a lot of buzzwords to define it, but it is actually quite simple. Let me introduce you to (or at least, demystify) a valuable term when it comes to online marketing: search advertising.
Searching for the Right Ad
To understand search advertising, you need to understand Google. It turns out that Google has monopolistic-like power online: nearly 75 percent of all searches are performed by Google. And for good reason: Google has established itself as the gold standard for Internet search. Google processes billions of searches each day and many of those searches involve consumers researching a company, product, or service. A specific marketing approach, search engine marketing, emerged to help businesses strategically guide more search engine users to their Web sites.
AdWords is Google's take on search advertising. It is a text-based advertising program devised by Google to allow advertisers to purchase space on a Google results page. The ads are targeted to "keyword" search results. Once an account is created, an ad can be submitted and the advertiser sets the maximum amount they are willing to pay per click--hence the name "pay-per-click" (or PPC) advertising. The advertiser pays only when a search engine user clicks on the ad and is directed to the advertiser's Web site.
Most search engines have similar programs, but according to the latest survey of advertisers and agencies released in February by the Search Engine Marketing Professional Organization, "The State of Search Engine Marketing 2008," Google AdWords is used by 98 percent of the respondents surveyed.
Making Sense of AdSense
Now we know about search marketing, but what about advertising on regular sites? It turns out Google has an answer for that as well. AdSense is a program Google created for Web site publishers that allows them to display targeted advertisements on their Web sites and pays them a percentage of the bid price Google collects from the advertiser. This allows you to advertise virtually anywhere on the Web that is mentioning something related to your product or service. When you advertise with AdWords, you can opt into the AdSense network, which gives your business exposure on hundreds or thousands of other sites, not just Google.
Results
Why should you spend money online instead of using traditional media, such as newspapers? When you purchase an ad in a newspaper or phone book, the price paid is typically determined by nothing more than circulation rates. You have no way of knowing how many of your potential investors or customers saw the ad or what the results of the ad were. What makes search advertising tools such as AdWords and AdSense so attractive is that they allow you to reach your target audience directly and they also provide a means to track and analyze the impact of your marketing campaigns. Google even has its own reporting and analytics tool, and it is a great way to gauge the effects of your campaign and identify which sites are generating the most traffic for you.
For example, imagine that you have a wine-distribution franchise and you notice a spike in traffic from visitors to an organic food Web site. You can modify your Web site's content to improve its appeal to that audience and generate higher sales (i.e., promote and feature your organically grown wines). So, in addition to effectively reaching your target audience, you get built-in market research that you can then use to modify your campaign quickly and easily.
Elements of a Successful Search Campaign
Even if a prospect clicks on your Web site, there are still several factors to consider when launching a successful search ad campaign.
Put Your Audience and Intelligence to Work
As a business owner, odds are you already know your markets, your products, and who your competitors are. What you're missing is effective, timely research that will lead you to new customers and potential investors in a competitive environment. Use what you know to your advantage when crafting your search campaign.
Budget
Before you do anything, determine how much you want to spend monthly. Don't spend more than you can afford. Setting limits ahead of time will keep you from over-extending yourself in a keyword bidding war.
You're going to want to test your ad copy, especially in the beginning. Think of it as Darwinian selection, where the best ads rise to the top and the worst die an untimely death. As with any marketing campaign, it's rare to see immediate results. Be patient. If you track and fine-tune your ads as needed, you should start to see optimal results in about 90 days. It will take another six months or so before things stabilize which will allow you to easily manage the campaign.
Bid Wisely
Some words of wisdom: before you select your keywords, check the price. Never bid too high, unless you're certain a specific keyword or phrase has a high conversion rate (i.e., leads to high sales). To estimate the amount you should bid, calculate your gross profit per sale.
Now for a little math. Let's say you sell bicycles and you want to advertise a model that sells for $400, and of that amount, you realize a $100 profit. If you allocate 30 percent of that profit to advertising, you should spend about $25 per sale. Since a reasonable online conversion rate for paid search campaigns is around 2 percent, your keyword bid price shouldn't exceed 50 cents.
Keyword Selection
The keywords you choose play an important role in converting the traffic your ads generate into sales. If you don't select your words carefully, you will drain your budget quickly. Using the example of the $400 bicycle again, let's say you pay a dollar per click for a keyword and you convert only two people out of 400 who click on your ad. You just spent $400 to realize only $200 in profits.
The best way to keep your bid costs low and improve your conversion rates at the same time is to be as specific as possible when selecting your keywords. Instead of bidding on bikes, bid on a specific model, like the Trek 3700. Also, limit the number of keywords per ad copy. Generally, you want to shoot for about 10 keywords and no more than 15. Google and many other search engines provide tools for picking keywords; use them, as they are very helpful.
Quality Keywords
To confuse you a bit, Google also uses a "Quality Score" to assess the effectiveness of your keywords. It measures the relevance of a given keyword in relation to the ad copy, Web site content and the user's search query. The higher the score, the lower the cost-per-click and the better the ad's position. This means you need to tie your keywords to your ad campaign and your Web site. Otherwise, Google will charge you more for your ads. This is where a good search agency comes in handy.
Direct Traffic to Specific Pages
You stand a greater chance of making a sale or generating interest in your business if you drive traffic to specific landing pages instead of your homepage. If your ad offers an incentive, consider crafting a separate page that provides specific information, as opposed to driving people to your home page.
Branding Opportunity
Search marketing doesn't always have to be about conversions. A well planned campaign can reinforce the value of your brand. If you sell lighting fixtures and the name of your business pops up when someone is searching for light fixtures, you can create immense brand exposure.
Analyze
The Internet gives advertisers an abundance of information. It is our responsibility to use it wisely, so analyze your data. Measure your profits against your incurred expenses. Look at how your clicks convert to sales, how Google ranks your advertising, how much your competitors are spending. The list is endless but the more you do, the better the performance. And if you don't have the time, hire a search agency to help: the money you spend with them will be offset by better performance.
Wash, Rinse and Repeat
Think of the path to success for search marketing as "wash, rinse and repeat," where you start with a new campaign, analyze the data for the most effective creative, and then repeat the process over and over. AdWords campaigns take time, patience and yes, money.
There are many more intricate elements and strategies and all are worth investigating. It is well worth your while to stay on top of search engine marketing trends that can help you grow in a difficult economy, especially since the rules change constantly. Even if you don't have the budget to hire an in-house team, many companies that specialize in search engine marketing can expertly manage your search marketing campaign without taxing your budget or locking you into an intimidating contract. This has an added benefit of freeing you up to focus on growing your business. The bottom line is, when done correctly, search marketing is an effective method for generating sales. In this day and age, who can ask for more?
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