Category: ROI

Just some useful statistics on conversions as I’ve found them somewhere else or from my client analytics. In the interest of keeping this usable as a reference tool, this is intentionally brief. Perhaps I’ll expand more on certain points as necessary. All statistics are no older than 2018.

@ 60% of all conversions happen during a single visit
@ 15% of conversions require two visits
@ 25% of all conversions require at least 3 or more visits

@ 70% of conversions happen on the same day as the first visit

**Typical Local Business traffic Sources
@ 25% Maps
@ 25% Organic

You are a business owner looking at reports from your SEO vendor and they show you a list of 100 keywords that you rank #1 for. You feel good!

This article will explain how keyword volume and rank reported throughout the SEO industry is misleading because it is based on a source (Google) that is assumed to be respectable and accurate. Well, we can prove it is not accurate anyway.

You want to know that your SEO vendor isn’t selling you a feel-good story. Lets face it, most of those fancy reports don’t tell you anything actionable anyway – they are just pretty and somehow leave you with a warm and fuzzy feeling. But business decisions should not be based on “fuzzy feelings”. So lets cut through the crap.

• The truth is, those reports are just telling you what you want to hear, showing you what you want to see.
• Most Search Rank Reports highlight Zero Volume keywords that make you look good, 0 volume means noone uses those.

Your SEO is probably using Google’s Keyword Planner to find those keywords for on-site optimization and for PPC in Adwords? I’ll show you why Keyword Planner, the source of most reporting, is completely inaccurate to the degree that it is useless. ( remember this article is about local search, not global. Google Keyword Planner may be fine for huge volume keywords, but not for local small volume keywords. )

I know many SEO’s reading this will say, “Why bother? Just build more content and do more link building.” ( But that sounds very much “build it and they will come” – not much business acumen in that! )

The fact is, if we are going to do any Internet Marketing at all, blog more (build more content) and get more backlinks; we still want to know which keywords work and which don’t. OK. How do we find which keywords we should use?

Step #1 – What does Google say about our current exposure?

In Google Analytics > Acquisition > Search Console > Queries

(If you don’t have this menu option, it means you need another type of help first)

On the far right is the first level on our way to Keyword Enlightenment; our Average Position. Now think!

• if our website is getting an Average Position of 1st place for this keyword, shouldn’t our website be seen EACH time someone SEARCHed using that keyword?

Correct. So in that 2nd column are the Impressions we got. Next logical step would imply;

• if our website is seen for each search, then IMPRESSIONS = SEARCH VOLUME

So lets verify the Search Volume for our keywords using Google Adwords Keyword Planner.

Step #2 in Keyword Planner we must narrow our view to a Geo ( otherwise Google will give us global volume instead and we are not interested in what happens more than 100 miles away from our business ).

We copy and paste our keywords from Search Console > Queries into Keyword Planner, we download our results, sort in a spreadsheet, correlate the two sets of data (the tedious part and why good SEO work is so time consuming – and because Google is not really trying to help ) and we get an interesting juxtaposition.

• Why is Google telling us there are 390 searches (Search Volume) for a keyword that our website got the #1 spot for yet was seen only 83 times?

That does not make sense. That is a 470% inflated “estimate”. Why does Google report two different results for what is essentially the same thing? I’m inclined to believe that Keyword Planner is a feel-good tool. And that is why I think it is useless for doing any keyword research. I could extrapolate further whether anything Google reports is accurate, including the clicks a website “supposedly” gets in analytics. This all means that SEO vendors using Google data for their prettier reports (which is almost everyone) are even more useless.

BTW, this is why we built SearchStation. At least with SearchStation we get accurate search rank (which means Impressions in both Organic and Paid results). I would suggest employing a 3rd Party Analytics tool to track clicks as the other reporting we would need to get some realism back into our keyword research and SEO reporting.

We can now cut the crap and conclude that the only way to To Do Keyword Analysis For Local Search Engine Optimization is to derive it locally from actual SEARCH RANK and TRAFFIC that actually hits your website.

Having reached our goal of Keyword Enlightenment we know that Google’s Analytics and most SEO Vendor Reports are feel-good reporting and not the real world. We also now know that if our website consistently ranks #1 for a keyword, then visitors reported in our analytics is the most accurate measure of Search Volume for that Keyword.

Coming soon, in Part II of this series, we will take a look at the accuracy of Search Rank Reporting in Google Search Console.

Measuring your ROI and determining your advertising spend does not have to be overly complicated if you just need a back-of-napkin estimate. Here is the easiest way you can get the numbers you need to start making better decisions about the money you spend online.

Open your Google Analytics (GA) and create a Goal from a Product (page) to a Lead form. Wait a week or whatever time-frame you think will give you a good sample. Then look at your GA Acquisitions > Sources. You should see something like this.

In this view, the Goals we have setup clearly illustrate the quantity and quality of leads each source produces.

Back-of-napkin we can immediately see a dramatic differential between the Quality of Organic visitors versus our paid sources. If your report looks similar, you are asking “Why are we not budgeting more to acquire more Organic Traffic since those visitors are far more productive?”

Expedience

1. Most businesses do not think about Organic visitors as something they can get more of (quickly).
2. Most business spending goes ONLY to CPC (Adwords/PPC) and 3rd Party Leads because they both produce tangible visitors as soon as you submit your credit card.
3. But NOTE: If we spent $5000 on #4, we wasted $5000 – the only thing expedient there, is how quickly we are going broke!

Perennial Traffic

• Spend on CPC (Adwords/PPC) and 3rd Party Leads has 1:1 proportion. You must pay for each visitor. Stop Spend : No Visitors.
• Spending on Organic visitors is perennial to your ROI. Small but gradual spend : Ever More Visitors.

Don’t take your Organic Traffic for granted.

By the way, “I have a website, they will come” is not the correct way to pursue your Organic Traffic strategy. A better analogy is to view your Organic Traffic as gardening.

Grow more organic visitors! Organic visitors are the only perennials in your garden and all gardens need tending and patience to produce good yields. Now you have made a better decisions about your Internet Advertising spend.

How would you like to cut your PPC ad spend by perhaps 90% and get the same net revenue?

This is not a cheap come-on. This tsunami is ripping through the digital marketing space as we speak. In case you have missed it, there have been three significant stories recently; Proctor & Gamble, then Restoration Hardware, now today Uber has filed a law suit against its advertising agency – all concerning waste and fraud in the Pay-Per-Click ad market.

The Restoration Hardware story summarizes the situation best; Restoration Hardware generates almost all of its Pay Per Click traffic from only 22 keywords.

“We’ve found out that 98% of our business was coming from 22 words. So, wait, we’re buying 3,200 words and 98% of the business is coming from 22 words. What are the 22 words? And they said, well, it’s the word Restoration Hardware and the 21 ways to spell it wrong, okay?”

I’ve been going up against agencies for years as they boast of their superior ability to manage 10,000 keywords (no kidding, 10,000). Well these revelations kind of put that selling point to rest once and for all. RIP!

You may not hear one peep about this from the usual Internet Marketing cheerleaders. Those “Internet Marketing Cheerleaders” include every agency and eZine that blogs about Search Engine Marketing daily. Not only do they seldom write anything worth reading, they never write a negative word that might impact their standing with Google. Obviously Google does not want this kind of news circulating, so 1) don’t expect the cheerleaders to blog about these high-profile corporations and their experiments cutting ad spend by 90% and 2) expect these headlines to be scrubbed from search results (or found on page 7).

The large advertising agencies are wishing these things were never published. They make too much money on the status quo (meaning the same fraudulent practices) because fees are based on a percentage of spend, and most clients are ignorant of the workings of the digital ad marketplace. Ignorant clients are good clients!

I want to plug HARTENSTINE right here because we have always charged a flat fee for our PPC services. That is so we have no incentive to spend client money recklessly.

So what may be a pivotal nail in this coffin, today Uber announced that they are the victim of not only wasted ad spend, but click fraud as well. The entire law suit filing is at that link detailing just how it is perpetrated. Its a worthy read.

Don’t be an ignorant-good client!

Obviously these are large corporations utilizing equally large ad agencies, but the percentage of waste is probably proportionate across the board. So even if you are a small business, you could be wasting 80% or more of your money on pay-per-click ads that do not impact your bottom line.

What are your 22 keywords? Lets find out and save some $

Does Blogging Pay?  Its the most common directive issued in SEO. Blog! If you want free traffic, Blog! If you don’t have a big budget to pay Google Adwords or Bing Adcenter for clicks, BLOG!

But does blogging really payoff? Here is your real-world-local-business answer. Not only can we see exactly how many clicks a blog post is bringing every month, month after month; we can calculate the exact value of those clicks, and therefore calculate the exact value of the blog-post. (which means how much could you pay someone to blog for your business) Here is our Query Report from Google Webmaster or Google Analytics.

A single Blog-post about how swimming pools can pop out of the ground, brought our business 31 clicks from natural searches last month.

Therefore if our blog-post brought 31 visitors and we are paying a nice round figure of $3.30 per visitors in our PPC campaigns, the blog is worth $102.30 per month or $1,227.60 per year. With this data, we can now make many more assumptions about our marketing spend.

Brilliant! Hold on! What you may have missed is that there are 4 blog-posts on this website, but this is the only one that is performing to bring us a measurable number of free visitors. That is a variable that needs to be included in our overall marketing calculations to determine what a blog-post is really worth (paying for).

Plus there are a few noteworthy bullets to go with our numbers that can serve to flesh-out your Internet Marketing assumptions:

1. The blog-post title, when written, did not reflect what those online searches would be that produces our traffic. This blog-post could potentially perform much better with the right title. That’s water under the bridge, but now that we know, we can still do some SEO to increase our page position and thereby, increase our clicks.
2. The CTR for this post is exceptional. Combined with Average Positions (that are at the bottom of page 1) and that tells us the other results on the SERP (search results page) are not as appealing, and may also mean our meta description (SEO) is working well.

Another critical marketing variable not provided here is CONVERSION (into leads, into sales) but that’s something for another post. With conversion figures you can really dial-in your ROI – the ultimate in Internet Marketing Planning.

Alrighty then:

• Q: What should I blog about?
  • A: What questions do your customers ask you?
• Q: Should you hire someone to write blogs?
  • A: Can you produce the material for them and can they optimize the content?

I know those are not an answers, but they should point you in the right direction to the answer you need. Only you know your business well enough to make all this work. Everyone else can only help.

Well, without question, blogging works to bring (relatively) free traffic and save you the cost of paying Google and Bing for visitors. There is technique (SEO) involved in making it work to its full potential, but my experience is that everyone has moments of inspiration and motivation, but few can actually execute – consistently. Perseverance and persistence (lack thereof), not $, is what inhibits most Internet Marketing from real success.

But at least now you cannot say you don’t know whether blogging is worthwhile for your business.

How Do I Know Im not paying for Fraudulent Clicks?
How Do I Find My/Google’s Invalid Clicks Report?

A common concern for everyone, including me, is how can we be assured we are not paying for fraudulent clicks (click fraud) in our PPC campaigns. Well the short answer is, we can’t. Its entirely within Google’s purview to handle those odd-looking clicks and all the nuanced behavior of the “clicker”. Google does not provide even the originating IP address of the click. If we saw a bunch of clicks from the same IP address, we could dig deeper and maybe find the fraud. They could provide that information, but then there are issues of privacy, etc, that they don’t want to deal with. (Of course they do sell that data to advertisers who are willing to pay for it. Its all about the money after all. Privacy for sale!)

The obvious conflict of interest is that Google makes money when someone clicks. Refunding you for what looks like a bot or your competitor does to hold much incentive for Google does it? There have been lawsuits to stoke your fears too. In 2006 Google paid $90 million in a click fraud case. https://www.wired.com/2006/03/google-to-settle-click-fraud-case/ So there is THAT disincentive to prevent Google from turning a blind eye to the issue. But $90 Million (2006) out of annual sales of $111 Billion (2017) is .08%. Not much of a disincentive, is it?

We can find some comfort that Google is the master of algorithms, and it should not be too hard for Google to spot a bot or a competitor who has nothing better to do than click on your ads with their algorithms. They report those (refunded clicks) as Invalid Clicks in Adwords – more on that below.

The bottom line to the issue is, we can take Google’s word that they handle those clicks appropriately. We can also pay attention to our campaigns performance to spot poor ROI, which will greatly reduce the chance of paying for nothing-clicks. And finally, you can see how many clicks Google identified as fraudulent (invalid) here:

About Invalid Traffic

Does Google have a Invalid Clicks Refund Policy?

http://www.google.com/ads/adtrafficquality/invalid-click-protection.html

How does Google guard against click fraud?

https://support.google.com/adwords/answer/2454071

How Do I Find My Invalid Click Reporting in Adwords?

Invalid clicks / Invalid click rate
These columns indicate the number and percentage of clicks that were classified as invalid and automatically filtered from your account. You aren’t charged for these clicks, and they don’t affect your account statistics. Data for invalid clicks is only available after January 1, 2006. Learn more about invalid clicks. This column is available on the Campaigns and Dimensions tabs only.

How To Display Invalid Clicks

• Sign in to your AdWords account
• Click the Campaigns tab.
• Click the Columns button above the statistics table
• Select “Modify columns” from the drop-down
• Under Modify columns > Select metrics
• > Performance
• > Invalid Clicks ( >> add to your Column List )

Most people seem to believe that Google Analytics is the only analytics product on the market, if your definition of “a market” is “free”, that is. In fact there always has been a plethora of analytics products available other than Google’s. Here you can research more than just market share…

http://trends.builtwith.com/analytics

Anytime those (often very loud) promoters of Social Media advertising (spending) speak, they should be confronted with the facts. When faced with these facts, its hard to justify any Social Media spend. The studies continue to prove the same end result year after year.

Here at Zerohedge is yet another very good example 62% Of Americans Say “Social” Ads Have No Impact On Purchasing Decisions. That article is sourced from the WSJ which said, In a study last year, Nielsen Holdings NV found that global consumers trusted ads on television, print, radio, billboards and movie trailers more than social-media ads.

And another Zerohedge article from earlier in the year illustrates why: Recently, Facebook got into hot water with investors when it was revealed that as many of its 1.18 billion active users 14.1 million (and likely orders of magnitude more) were fraudulent. 

The ROI has never been proven. Real social media exposure (advertising) cannot be purchased on any scale – fact. Yes, you can pay an employee to engage your following on some platform, distribute coupons, but that’s about the end of it. And even then, the real engagement may not have an ROI. (You may sell a few more (____), but the time you or your employee spends on Social Media may not be profitable).

I find that new-comers to the online advertising business have a natural skepticism about the efficacy of PPC advertising that warrants a special case study. But better than a study, lets look at a recent campaign and the results.

Here is what the client said after initiating an aggressive Google Adwords campaign. “…Also note in the graph that in August our Used Car sales as a percentage of our market was extremely high. When I was reviewing the pay per click with our managers I discovered something more interesting. Our pageviews increased 28% however our preowned vehicle search results increased 121%. More evidence that our PPC effected our numbers in August (after a weak July).”

It is important to note that ROI is an important condition of the efficacy of Paid Search – if it costs more to make the sale, your margins need to remain in tact to justify PPC advertising. You can always sell more at a loss, but selling more at a profit is what its all about. But in the case of online PPC advertising many new-comers become blinded by the complexity of PPC and overlook the obvious!

The beauty of Internet Marketing is that it is the only marketing that is 100% measurable.  You can know how many people see your ad.  You can know how many visited your website.  All this makes calculating ROI possible.  And sooner or later you will calculate the feasibility of using Paid Search to sell your products online.

How to calculate ROI for a PPC or Paid Search Campaign is something everyone learns usually after they already spent too much money. While there is plenty of information online about how and why you should include PPC in your online marketing strategy, the ROI parts are few and far between, and reading all the marketing material is akin to drinking from a fire hydrant. There is an easier way to ascertain your Paid Search ROI.

Here’s how:

1) Profit Margin and Sales Volume: Start first with your business model. How much profit do you make on each product you sell online. In some cases the question is how many must you sell online to make the business viable.  Lets say we have a $100 product which at this point has a profit of $30. That 30% margin is what we can “play” with for our PPC marketing.

Include the online transaction costs and fulfillment costs (delivery costs) as well. Don’t forget to include the cost of any other Internet Marketing you might be doing, including any SEO or web site development.  You may even want to total the cost of your website expenditures to date, if you are a real astute break-even-analyst-type.  Now you have the total amount of money you could spend to attract a buyer via PPC. 

2) Conversion Rate: You may already have statistics from your analytics that indicate the conversion rate of your website.  Lets say that the conversion rate is 5%, or for every 1000 visitors you sell 50 products on your website.

If your website conversion rate is over 14% you either need to double check your measurement method(s) or you don’t need to read this because you are an expert at this game already. If you don’t know the conversion rate of your website (because it is new and gets no natural search traffic yet, and thus why you must acquire customers via PPC) you can run some low risk (inexpensive) tests to determine the conversion rate and thus the viability of using PPC to grow your business online. In order to keep this post on target, I describe the low risk methods to determine your website conversion rate there.  If you don’t read that page, heed this: GO SMALL and GO SLOWLY and DOUBLE CHECK SETTINGS.  If you are new to PPC, its very easy to blow your entire budget in a day (sometimes an hour) because you overlooked one simple setting.

3) Visitor Acquisition Value:  If you make $30 per sale and 5% of the visitors to the website buy the product, that means each visitor is worth $1.50

(50 sales x $30) / 1000 visitors = $1.50  |  This number is also considered your Maximum Cost Per Click, over which, you’ll loose money.

4) Value Proposition for PPC justified! That seems easy. You can now fantasize about growing your business to Fortune 100 status because you can spend $0.75 per click, and with a 15% margin, make more and more money because you can afford to increase your marketing spending as your sales volume rises.  Brilliant!

Not so fast cowboy.  Even if all that is accurate, there are a few barriers to success that you will become aware of.

If your Maximum Cost per Click is less than $0.50, a PPC campaign for your product may not be viable – because getting clicks for under $0.50 may simply not work. Although Google and Microsoft (and Facebook) advertise that you could pay as little as $0.05 per click, that cost per click is seldom attainable, even in markets where little to no competition exists. You can try it, but be aware of the potential for disappointment – that you just won’t get clicks for less that $0.50 no matter what the marketing material says.

Average CPC barrier: The average CPC of your industry may mean you get no exposure bidding $0.75 per click.  In fact your ad may not display at all even at a $1.50 bid because the average CPC for your industry is $4.50.  Which means the top 6 positions (where you need to be to acquire the maximum number of clicks) may cost $6.00 per click.  There goes the ROI.

Search Volume limitation: As pointed out in #1, the question may be “how many must you sell online to make the business viable?” Your product may simply not have that much online demand. Although you could expand your business if you could get 3000 visitors per day, they don’t exist!  If only 1500 people search online each day for your product, no matter how good your Paid and Natural search positions are, you cannot get 100% of those visitors to your website. They clicked on the other ad or listing and somehow got distracted and…they are gone forever. So you manage to get 900 visitors each day: redo your ROI calculations.

At this juncture you should consider ways to increase conversion on the website. That can have huge implications for the viability of using PPC to grow your business online. But keep in mind that improvement potential is not infinite. Some of the very best online businesses struggle to get 15% conversion.  Between 2% and 6% are normal, and you can feel very good if you get over 8% conversion.

But don’t give up just yet! There are tricks that can lower your cost per click or increase your click-through-rate on ads. Unfortunately there are no tricks I know of that apply universally to all industries. One example that works amazingly well in one industry is to use the term “Sale Ends Monday” in the ad. That trick increases CTR by 30%. Another trick that works well for high-end products is to target wealthy neighborhoods only, which greatly improves the conversion rate per click, which means lower overall CPC. And there are lots more. The potential to find a trick that changes your ROI calculations are seemingly infinite. But you have to know how to use Adwords and Adcenter expertly and you have to experiment.