How to reduce adword costs

High Cost per Click (CPC)  is one of the main concerns for any advertiser.  The increasing popularity of online advertising has also increased costs per click throughout the web. In fact, in some industries, the price of running ads may be as high as the product being advertised. The following strategies will help you reduce your CPA (Cost per Action/Acquisition) and make you get the most of your advertising dollars:

Target the right keywords

One thing that all customers in all purchase situations share is the Buying Decision Process. In this process, customers go through several stages before reaching their purchase decision. Your keywords and message need to change depending on the stage you want to target.

  1. Need Recognition:

In the first stage of the purchase decision process, your customer is trying to find a solution to a problem. Search queries at this point are very generic and broad. Unless the purchase decision is simple, your prospective customer will not be ready to buy at this stage. So avoid advertising in this stage by not using short and generic phrases as your keywords.

Example keywords for this stage: Vacations, home improvement, business ideas.

  1. Information Search

In the second stage, customers are looking for alternative products or services to solve a problem they have previously identified. Unless you have a large advertising budget or your product is intended to be informative (such as a book, for example), you may want to stay away from this stage too. Do not target how-to phrases or undeveloped sentences.

Example keywords for this stage: Vacation destinations, How to fix a leaky faucet, Accounting services.

  1. Alternative Evaluation

At this point, customers have an idea of the kind of product or service that will satisfy their needs. Their search terms become fully developed and they expect to arrive at websites that will provide them with the right solution. This is the stage you want to target. Use long-tail search terms containing product features.

Example keywords for this stage: Hotels in Downtown Miami, Plumbing services in Miami-Dade, CPAs in Brickell.

  1. Purchase decision and post-purchase behavior

Hopefully, the purchase decision will happen on your website and you will convert your visitors. After every purchase decision, your customers will evaluate if they made the right decision. This is a great opportunity to reinforce this decision and offer your customers other products or services. Target your brand term plus any other additional products or features relevant to the customer.

Example keywords for this stage: Travel rewards for ABC Hotel in Miami, ABC Plumbing services, John Doe, CPA audit services.

Expand (or narrow) your market

Many of us make the mistake of selecting our carelessly selecting the target market for our ads. If your business can serve customers nationwide (or even internationally), experiment targeting new markets. Some geographic regions get less competition than others. Oftentimes, this makes their CPC less expensive.

On the other hand, if your business can only serve a small geographic area, you may want to narrow your target region as much as possible. Decreasing the size of your geo-targeting will not decrease your CPC directly, but it may help you convert a higher percentage of customers (because they are more likely to buy from you). This will decrease your acquisition cost in the short and long term.

Optimize your landing pages

Your landing page, that is the page that you link to in your advertisement, should always be optimized. A common mistake in advertising is sending visitors directly to your site’s home page. Landing pages should contain only the information necessary for the customer to take a desired action (make a call, subscribe to your mailing list, get a quote, etc.). Adding unnecessary elements to your landing page will only distract your visitors and reduce your conversion rates. Moz.com has a great article on landing page optimization that you can use to improve your pages.

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