How Pay Per Click Can Increase the Value of Your Ecommerce Site One of the great things about PPC ads is that tracking occurs automatically so you can determine your cost per acquisition and conversion rate.

By Thomas Smale

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

Pexels | Enhanced by Entrepreneur

When it comes to generating traffic for your ecommerce site, you have multiple options: content, SEO, social, email, forums, webinars and many other possible sources. But when you have a well-optimized ad, there are few traffic sources as valuable as pay per click, or PPC.

Related: 5 Pay-Per-Click Mistakes That Can Cost You Money

PPC is a paid advertising model that allows you to send direct traffic to your website. It can also help your site be seen in search, as PPC ads tend to be displayed toward the top of search results.

As a result, you'll get more eyeballs on your product offering. Not everyone who visits your site will necessarily buy, of course, but you can optimize conversions by testing and experimenting with different copy, designs, colors, offers, keywords and so forth.

Converting the traffic you get is the hard part, but targeting your content is getting easier than ever; and dynamic search ads could well be a game-changer in this regard.

So, if you're curious how PPC can increase the value of your ecommerce site over the long haul, consider the following categories:

Diversified traffic and revenue sources

In an online business valuation, prospective buyers are going to be taking a close look at the various revenue sources your site has. And, the fewer revenue channels you have, and the more dependent you are on any one traffic model, the more at risk your site may be. That means a risk of losing revenue.

For example, say that search is your No. 1 traffic source. Because of ongoing search engine algorithm updates, your site could suddenly become de-ranked in search by the latest update. That's not rare, since search engines can -- and often do -- change the game. So, remaining reliant on search alone could definitely have some downsides.

If you have diversified revenue streams, though, buyers will value your site higher. Even if your site is at risk of losing one source of revenue, the existence of backup sources will allow your business to be valued more, and will give it more longevity.

If you haven't yet added PPC to your promotional efforts, now may be a good time to look into it for your business.

Sales and conversion stats

One of the great things about PPC ads is that tracking occurs automatically. After you run an ad campaign, you'll be able to log into your account and view all relevant stats to see how your ads performed.

This allows you to nail down your cost-per-acquisition and conversion rate. Prospective buyers are very likely interested in these numbers since they'll want to get a better idea of the expenses involved in driving revenue.

Related: 5 Google Pay-Per-Click Tricks To Save Your Business Money

Generally, the lower the expenses are in relation to revenue, the better. This is where conversion-rate optimization comes in, and you may have to do a significant amount of testing to figure out how to get more sales. Because of how good targeting is becoming, however, this could be a moot point. More on that in a moment.

Bottom line: Buyers will want to see numbers related to acquisition and conversion to better understand whether or not their investment is worthwhile. The data you collect will prove invaluable to the sales process.

The ability to target better

On first inspection, PPC may appear to be a shotgun approach to advertising -- a means for pushing your ads in front of anyone that searches for a specific keyword. No wonder conversion rates tend to be so low.

But in Google AdWords, for instance, you can actually upload your customer email list. As you get more sales and collect more customer data, you can refine your targeting by importing this data directly into your PPC platform.

You can therefore target the people who have already bought, but also target similar, look-alike audiences. Such "re-marketing" is an incredibly effective way of generating more lifetime value from your customers, something an investor would surely like to see.

Additionally, dynamic search ads are also increasing in prominence. They allow you to show your ads based on the content of your website, not just on specific keywords of your choosing. This can actually eliminate the need for keyword lists and even landing pages, and can also boost your ROI.

Finally, the better defined your audience is, the better idea buyers are going to have of how to market your products to drive sales when they buy your business.

Audience targeting with PPC is only going to continue to improve over the long haul, so it's better to be a part of the wave than to be left behind.

Integration with other channels

We've already looked at how you can leverage your email and customer list for targeting and remarketing purposes. This is just one example of how instances of integration between different channels and platforms are going to proliferate.

Social media is the perfect example. Popular sites like Facebook and Twitter are only going to grow in importance as pertains to audience-building and targeting. Ignoring social could mean leaving a lot of opportunity on the table.

Further integration with customer-relationship management tools should also be forthcoming. Customization is not lost on PPC platforms. The value of sending personalized marketing messages and providing a tailored customer experience has been known for a while, but it won't be long before businesses and marketers can do more to appeal to their customers with their ads. Dynamic search ads are just one example of this notion in motion.

It's safe to say, then, that PPC ads are here to stay, and the technology will continue to improve. A well-educated investor keeping up with the trends is sure to look upon your use of PPC advertising in a positive light.

Conclusion

Investors looking at online businesses for sale aren't just looking for one thing, and the big-picture merits and demerits of a business are often specific to that business. What might be considered favorable in one situation won't necessarily be a benefit in another.

Related: Of the 4 Popular Pay-Per-Click Platforms, Which is Best for You?

But most ecommerce business owners would do well to look into PPC and the opportunities it can offer them. For owners who want to eventually sell their business for more, PPC is a particularly essential step.

Thomas Smale

Entrepreneur Leadership Network® Contributor

Founder of FE International

Thomas Smale co-founded FE International in 2010. He has been interviewed on podcasts, blogs and also spoken at a number of industry events on online businesses, exit strategy and selling businesses.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Related Topics

Science & Technology

The 'Mother of All Breaches' Just Happened — Here's the Security Implications for Businesses

If your business exists online, chances are some percent of your customers' data got leaked in what cybersecurity specialists boldly labeled as the "mother of all breaches" (MOAB).

Business News

Klarna Says Its AI Assistant Does the Work of 700 People. The Company Laid Off the Same Number of Employees 2 Years Ago.

The AI bot has taken on 75% of Klarna's customer service chats, or about 2.3 million conversations, within a month of launch.

Business News

The Owner of a Popular Boston Restaurant Is Under Fire After Direct Messaging, Berating a Customer Who Disputed $250 Cancelation Fee

New York-based traveler Trevor Chauvin-DeCaro was set to dine at Table in Boston's North End last month.

Side Hustle

Getting Laid Off Allowed Him to Focus on His Sentimental Side Hustle. Now He's on Track to Earn Over $700,000 in 2024.

Alaa El Ghatit wasn't fulfilled at his day job. So he started LifeOnRecord to help people record memories and well wishes.

Business Ideas

55 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.