The next chapter covers the mechanics of PPC, but for now it’s important to understand that successful direct-response advertising of any kind requires using methods and techniques that are closer to science than to art. Successful PPC advertisers constantly use calculators, spreadsheets, and software tools to plan, construct, measure, and optimize campaigns. If you’re not comfortable with the mathematical side of PPC advertising, you may need to find an assistant or colleague who can become proficient in that aspect of the job.
For example, determining the optimal price to pay for each click requires calculations based on the price you’re willing to pay for a conversion. Usually this is a simple one-time exercise, but for companies with multiple products or a range of desired conversion actions, the task can get quite complicated.
One of the biggest strengths of PPC advertising is that it’s easy to create reports that show exactly what is happening in a PPC campaign at any given time. You can quickly and easily see critical metrics such as the number of ad impressions, the number of clicks, click-through rates (CTRs), the number of sales, the cost of sales, and so on, for any period of time and for any elements of the campaign such as keywords and individual ads. Figure 1.5 shows examples of data types that can be reported.
It’s important for you to learn how to interpret this data in order to understand what it means for your business and determine whether your PPC efforts are profitable. The data will also indicate what actions you should take (such as changing bid prices or creating test variations of an ad) in order to optimize campaign performance.
Improving campaign results is dependent on continual testing—displaying two variations of an ad, for example, and then favoring the ad that produces better results. Successful PPC advertisers never stop testing variations in ad copy, banner ad design, landing page design, and content. It’s important that you learn and master the methods and tools required to test and to interpret results.
Fortunately, this book covers all of these topics in sufficient detail that you’ll be applying the best techniques after just a few weeks of practice.