Most businesses know they need to advertise and create promotions to get new business. In today’s world, getting repeat business from current customers is not guaranteed. Let’s face it, there are dozens of competitors at every corner waiting to take our customers with a promise of the lower price offer, so we must be continually building value and earning our way in the minds of customers so that they consider us as the preference for the next purchase.

Pay-per-click (PPC) ads are a popular way to advertise, but are they profitable?
A lot of businesses immediately turn to PPC or paid ads as their main tactic for acquiring new customers. But is this a wise investment, or are they losing money with every click?
Many companies are not measuring or know if their PPC advertising is resulting in a profit or a loss of revenue.
The hard truth is that, on average, 97% of all paid ad clicks will not purchase anything, but you will pay for the ad click anyway.
So how can you tell if your advertising has a chance to be profitable before you spend your companies hard earned money?
Below are a few statistics and some free formulas you can use to tell if your ads will be profitable enough to start them or if you are already underway and should immediately consider other alternatives to obtain customer traffic.

The best way to check profitability is to use a cost of customer acquisition method of calculating an expense to profit ratio.
To estimate the cost of each new customer acquisition, you will need to know some campaign cost figures, statistics on your PPC campaign, and knowledge of some industry average statistics. These figures will help you estimate a realistic ballpark for return on investment (ROI).

Things you will need to know:
1. You will need to know the estimated cost per click for your particular product ad
Your PPC agency or person managing Google paid ads can get this for you, or it can be calculated with a couple of other figures from your ad campaign.

2. You will need to know the campaign advertisement spend
This is based on estimated number of clicks modeled inside the Google Ad purchase.
Your PPC agency or person managing Google paid ads can get this figure for you.

3. You will need to know the estimated number of monthly clicks that the Google spend will generate
Your PPC agency or person managing Google paid ads can get this for you.

4. Average sales order ticket
If you are an established company, you may already know this figure, or the data is probably available in your analytics.
If you are a new startup business with the absence of data, you may have to estimate this figure. The E-Commerce industry average “cart quantity” per order is one item, so you can multiply this quantity times the median product price for all products likely to be sold. This will be a good ballpark for an average ticket.

Once you have these figures, you can then use average industry statistics to estimate profitability for the ad.

Here are four steps and formulas for each to help you develop an estimate:
Step 1: Determine cost per click if not readily available.
Formula: ad campaign budgeted / number of ad clicks = cost per click

Step 2: Determine realistic traffic to the website
Formula: 3% (industry average conversion rate) x estimated ad clicks = Estimated Purchasing Traffic

Step 3: Determine acquisition cost per new customer
Formula: campaign cost (monthly budget) / estimated purchasing traffic = cost per customer acquisition

Step 4: Determine profitability
Formula: cost per customer acquisition – average order ticket = ad profitability
If you are looking for an accurate ROI for advertising, then you will need to also factor in profit margins that include manufacturing costs and expenses.
You could just be trading dollars or unknowingly losing significant margin, which is not a sustainable model for many businesses today.

What should I do if my PPC is not profitable?
Here are some actions you can take immediately:

1. Perform SEO with quality shareable site content
Shareable content can be developed in several forms. Helpful tips and educational articles of high quality will engage audiences to earn more product traffic and shares.
Google sees this content as high-quality based on activity, so the authority value continues to build relevance for your site. As the content is increased traffic growth organically occurs because of the value created in the content. An ecosystem of benefits is then created surrounding your product and your brand as a relevant authority for your product categories.
To significantly boost your audience and traffic consider using a blog syndication service that amplifies your content far and wide across the internet in many geographic locations.

2. Regularly market special offers to existing customers
Research has proven that keeping a current customer is far less expensive than the cost of acquiring new customers. Staying at the top of mind for current customers requires constant promotion to be considered for their next purchase.

3. Setup Email Marketing Campaigns
Create special offers & incentives for both prospects and current customers to signup for your promotional list.
Aggressively marketing good offers as a reward for signing up will build up your email list fast and provide a solid base on which to market future specials and quickly launch new products into the marketplace.

4. Have professional analysis performed on your PPC campaigns
Some PPC campaigns can be optimized to reduce cost and make them profitable. Some are just too expensive because of competitive pressures driving the cost per click up for your space.
You will want to deploy an advertising strategy that will work for your budget and business case.

We hope this information has been helpful so you can gauge the profitability of your PPC campaigns.

About Tom Hawkins
Tom is 20-year digital marketing veteran and President of Ascent Digital Marketing.
Ascent Digital is a full-service digital agency and eCommerce solution provider specializing in SEO, PPC, social media, content development, advertising services and consulting services for a wide variety of industries.
Ascent offers content syndication services using a diverse network of high network influencers that reach across virtually every industry and geographic area.

Contact Ascent Digital today for a free analysis of your PPC or advertising spend and let us help you develop a winning marketing strategy.

Are you looking to compete better with online retailers?
Are you a brick and mortar company losing sales to online eCommerce companies and Amazon stores?

We’ve helped companies in both scenarios by providing winning omnichannel and integrated digital marketing strategies that drive new sales. Our digital strategies and industry leading eCommerce technology will open up new business channels so you can win market share and improve product sales.

Why do you need an omnichannel and integrated digital strategy?
For today’s brick and mortar retailers and brands, not having a strong omnichannel strategy leaves double-digit sales on the table ripe for your competitors to steal just by showing up when you are not present or optimized with your execution.
Today’s new business threats may not be the traditional company you’ve faced in years past.
Your new threats may be comprised of 20-30 small newcomers capable of taking 10%-15% of market volume with strong online digital advertising and active social media campaigns.

Unfortunately, with the proliferation of social media embedded into new mobile technology, this trend will continue to increase dramatically in the immediate future. Now is the time to act to avoid losing more market share.

“I have a strong brand!” you say! Unfortunately, a brand name doesn’t carry as much stock as it once did. Think of the demise of Blockbuster Video and Border’s Bookstore. Both were once household brand names. They didn’t pay attention to the online storm coming that would totally destroy the foundation of their businesses by forever changing the way their customers both found and consumed the products they sold.

“But I don’t sell videos or books!” you say? This also affects your company too. Wholesale changes in the way consumers find and shop for products online are impacting virtually all companies. With strong value propositions, a great warranty and liberal return policies, even large purchases like automobiles and furniture that were once purchased in-store only are increasingly being purchased online with rapidly increasing on-site conversion rates.

For example, my wife recently saw a chair at Sams Club but didn’t like the color. Being convinced about the quality by viewing in person and a guaranteed return policy, she ordered her favorite chair color online and had it delivered to our doorstep. This purchasing exercise is already commonplace today and will only increase as we become used to making large purchases online that were once only made at brick & mortar locations.

Consumers have so much choice today that the brand voice is quickly diluted and easily replaced by stronger product level value propositions that speak more clearly to the customer’s emotional motivations for shopping.

So whether you are a veteran brand name or new startup company, I’m going to share a successful recipe needed to compete with those new online kids on the block.
Why am I sharing this recipe for free? Because to successfully pull it, off each company will also need the secret ingredients that make the recipe work. My company specializes in creating the recipe strategy, the secret ingredients and the right mix that makes it all work for more sales.

Here’s a four-step recipe for success in 2018:

1. Build and optimize your eCommerce website:
Customers use eCommerce sites very differently than company branded websites, but some companies confuse their branded experience for an eCommerce experience.
The eCommerce behavior is so different that these sites must be carefully optimized and tuned specifically for your customer’s shopping experience and motivational intent. Failure to optimize is a critical mistake that more often than not leads to sub-par sales and poor performance from the site.
This is the first and most important step because spending advertising dollars and labor to send customers to a poor site that they will abandon is a pure waste of investment.

2. Setup and optimize your Google local search listings:
Research shows that shoppers click the top organic listings at much higher percentages than the top advertisement spot.
The top 6 advertisement spots only achieve a 16% click rate.
This means 84% goes to the organic listings.
With the rise of mobile phone shoppers, Google has tweaked their algorithms to read customer intent and show locations within their region.
This gives preferences to sites that have optimized their local listings online and also that have optimized them for crawling on their websites.
There are several strategic advantages for companies that optimize for local markets first. After a site is fully optimized with all these steps, the traffic and conversion from this step will provide a boost for the other steps meant for gaining organic national attention and sales traffic.

3. Optimize your SEO to gain more organic traffic:
Search engine optimization has changed a lot over the last few years. Gone are the days of setting up spammy pages and link farms.
Those tactics will get sites blocked or degraded with today’s Google search.
Google now looks heavily at quality factors and how well your site content meets the consumer’s intent.
There are many areas to be optimized and satisfy the Google search algorithms. Good site optimization determines whether or not your site gets listed and customers find you in their search results.
The good news is we have many years of experience helping companies surpass their competition by increasing their products “Google relevance” through more compelling content, improved search quality, and a better sales quotient.

4. Optimize your Ad spend:
Many companies throw away thousands of advertising dollars each month without knowing it.
This is an unnecessary loss because, with a little guidance, these ads could be achieving a good return on investment.
A good example is YELP. YELP charges by impression. This means you pay when an Ad shows on a page, not when they click the ad.
The sad truth is that the vast majority these impressions are not even seen because they are at the bottom or side of a page where the users do not focus.
YELP also pushes installation of their app by showing an app installation pop-up. This is a huge turn off for visitors and suppresses precious ad content in favor of their own self-promotion tactics.
YELP pays Google for your ad to show up. Because of this, you are paying several times more per ad than programs that integrate directly with Google or social media platforms.
To make matters worse, the conversion rate for YELP ads are several times lower than Google or Facebook ads. This means there are many better investments out there.

We highly recommend immediately shifting your YELP ads over to a different blended mix based on your audience demographics and behaviors. This will provide an immediate boost for ad campaign performance.

Conclusion:
These steps are not easy to implement unless you have expertise in each area and can integrate each of them to work cohesively together. Each area is one part of an overall puzzle needed for success.
Chances are, you will need some help in the future to navigate these ever-changing digital waters. We’d love for you to consider Ascent Digital when that time comes.

About Tom Hawkins
Tom is 20-year digital marketing veteran and President of Ascent Digital Marketing.
Ascent Digital is a full-service digital agency and eCommerce solution provider specializing in Magento eCommerce platforms, SEO, social media, advertising services and consulting for a wide variety of industries.
Ascent develops comprehensive digital marketing strategies and online advertising programs that deliver results.

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It’s hard to believe that it’s 2017 and nearly 50% of small businesses still don’t have a website. According to a recent INC magazine survey, 25% of those lacking a website are planning to develop one in the near future, but shockingly, the remaining 25% cite no relevance for a business website.

According to the Small Business Administration, 50% of small businesses fail within the first five years. The most common reasons for failure were their lack of experience or volume of their competition. The statistics indicate these small business owners don’t know they are missing sales since it’s impossible to see the benefit from something that is not in place and is not being measured. “They don’t know what they don’t know”.

Let’s view some research statistics that show the clear benefits for virtually every business category.
– 94% of B2B buyers perform online research during the purchase process.
– 84.3% check for a business website
– 77% use Google to search for online information about the product and company.
– 41% use reviews or testimonials to form an opinion on company quality.
* Statistics from an Acquity Group procurement study

Customer Expectations
According to Inc Magazine, prospects will expect to find specific information on a company website. The research overwhelmingly indicates a vast majority of customers expect to see a product website with value added content to support their product research.

The big question from businesses that only sell in offline markets is, “So how do we know that adding a new website will contribute to new sales for our type of business?”

A website provides the following immediate sales benefits:

– Serves customer inquiries with many forms of media from a single cohesive web page.

– Offers greater value with persuasive selling copy, detailed photos, downloadable brochures, product specification sheets, video commercials, case studies and much more.

– Landing pages provide a targeted hub of product engagement that no other medium can achieve on its own.

– Social media posts are very short lived in a prospect’s timeline where your website could be a constant beacon for product and brand value.

– A website provides an opportunity to control the narrative over negative external social media posts by using on-site testimonials and customer reviews.
What is the cost of not having a website?
Here’s a great real-world scenario:
A local company has paid for a Facebook boost to promote an expensive product line they are trying to sell. They have a substantial inventory they are needing to sell.
The problem is that there is no website hub for prospects to click into and see the specifications, warranty, demo videos, customer reviews, photos, competitive comparison, etc… – All of these items are expected by consumers and are found on competitor websites.

Without the ability to demonstrate comparable product performance or superior value, the business will have a difficult time selling these units.
The “social proof” demonstrated by the competition will win over “no proof” most of the time.
This scenario demonstrates that the cost of developing a website is very low compared to sales they are missing.

This was only for one product, so imagine the business impact for a whole catalog of products. Stay tuned for a future success story for this business.

Is a broken or missing website costing you sales?
Contact us today for a free business traffic analysis and find out.

Email: sales@www.ascentwebmarketing.com
Phone: 417-501-9842

We’ve also fixed plenty of sites that took several months to develop – so time in development is no indicator of success.

The old phrases “you only get out what you put into it” and “you get what you pay for” are especially true in website development. Even if you’ve spent 30 months building it, most sites will likely be doomed to failure as a sales channel without a customer-focused strategy.

That’s right – your site could and should be a sales channel! Building awareness is fine, but that is only the first step in the sales cycle.

We can safely say that the vast majority of sites we’ve seen developed in less than one week lacked a customer-centered strategy which is a key attribute required for success.

For example, if you purchased advertising to send people to an unorganized website, then it would be a wasted expense. Sadly we see this happen every day. A site is like a water funnel. A poorly converting site architecture will lose most of its water before it reaches the bottom (where the cash register is). If it’s not “holding water,” an integral part of your marketing strategy is missing, and you could be losing money every month! We know what causes the holes and precisely how to plug them!

Customers only care if your site serves their needs at each step on the path towards a purchase. Everything else is secondary and doesn’t matter if the customer’s key needs are not served.

How do we do that?
We start by discovering your customer’s needs, wants, motivations, and how they will actually use this information. Then we focus on what information formats and structures are most usable for them to consume on mobile, tablet, laptop and desktop.

Why use Ascent Digital Marketing?
We have over 20 years of experience successfully connecting new customers to our clients’ products and services through cutting-edge digital marketing strategies.

We build sites that sell better and work harder for you!
To fix your site, or build your next one contact us at sales@www.ascentwebmarketing.com.
Small projects will receive a free site assessment and a budget friendly quote.