We're here to help!
If you’d like an assessment/audit of your Google Ads account, please submit your info here or email jesse@alignedppc.com.
Menu
A SIMPLE SCORING SYSTEM
Deciding how to prioritize your marketing mix is tricky. Depending on what product or service you’re selling, certain digital marketing channels are more appropriate than others.
The most dominant paid media channel is, by far, Google Ads (formerly known as Adwords).
Facebook’s ad platform comes in second, with Amazon’s internal advertising platform ranking third.
But you’re here today for Google Ads, so that’s what we’ll tackle.
At Aligned PPC we have devised a simple scoring system for determining if Google Ads is “Worth It” for your business.
This system is comprised of the following criteria/characteristics about your business:
Google Ads really shines in the B2B space. It makes sense if you think about it . . . the other major paid media platforms (Facebook/Instagram/Amazon/TikTok) really cater to the B2C audience, who are more prone to impulse purchases, and aren’t always directly searching for products they might be looking for. However, impulse purchasing doesn’t really exist in the corporate environment, where noticeably more information searching happens prior to purchase.
For this reason, add the following to your score (which you’ll add up at the end):
Not all types of businesses are well-suited for Google Ads. If you’re promoting a mobile app, then using app store search ads, in-game ads, and social media ads are far more likely to show promise than Google Ads (although there are certainly some exceptions). On the flip side, there are some types of businesses that are especially well-suited for Google Ads, like SaaS products and certain types of Service businesses.
Whether Google Ads are appropriate for your business will become more evident below when we look into Search Volumes, but for now, add the following to your score:
At the core of Google’s ad platform is keywords. In order for someone to find your business, they must type into Google a search query (e.g. “best google ads agency in Los Angeles”) that includes a keyword (e.g. “google ads agency”) that you want to serve an ad for.
So, it should come as no surprise that in order for Google Ads to make sense for your business, people must actually turn to Google for what you offer. Understanding if that’s true boils down to Search Volume.
When we refer to “head” terms, we mean the high volume, broad keywords that are relevant to your brand. For example, if you sell home insurance, your “head” terms would be “home insurance” (74,000 searches/mo in the US) or “homeowners insurance” (135,000 searches/mo in the US). On the flip side, your longer, more detailed keywords might include “homeowners insurance quote” (22,200 searches/mo) or “best home insurance” (6,600 searches/mo).
Here’s how you do this step:
Add the following to your score based on the combined volume of the 3 highest Search Volume terms:
As with any paid media platform, understanding your unit economics is vital. Once you know your economics (and most importantly your gross margin/unit economics), you can often do some simple math to figure out your breakeven KPIs.
Using Google’s Keyword Planner tool, as you did above, will also give you Google’s suggested bid levels for your desired keywords.
This will help you do some rough math to figure out if the economics of Google Ads make sense for your business.
Let’s do a quick example. Perhaps you sell a SaaS product that costs $50/mo, and the average customer uses your software for 9 months. That’s $450 in lifetime revenue. If your gross margin is 80%, then your Average Lifetime Gross Profit per Customer is $360.
Now let’s say your average cost-per-click is $4 (you can get rough estimates from Google’s Keyword Planner), and you think you’ll be able to manage a 3% conversion rate. At those levels, it will cost you $133 to acquire a customer, which is far less than your $360 gross profit. Seems like this could be viable!
In order to be profitable on any paid media platform, having a higher Average Lifetime Gross Profit per Customer is a huge advantage.
For that reason, add the following to your score based on your Average Lifetime Gross Profit per Customer:
Now that you’ve added up your points from above, here’s how to tell if Google Ads are worth it for your business:
If you’d like help calculating your score, or have already calculated it and are interested in developing a world-class Google Ads program, please feel free to contact jesse@alignedppc.com to learn more.
*This article and the scoring system outlined in it are copyrights of Aligned PPC*
If you’d like an assessment/audit of your Google Ads account, please submit your info here or email jesse@alignedppc.com.
