What’s the Point of PPC?

Posted on | January 18, 2010 | No Comments

Perhaps shocking but true, is the fact that there are still brand / lead generation / marketing managers out there who have allocated a marketing budget to PPC spend, but they do not quite grasp its purpose. What seems to happen is that upper management has experience with the PPC medium and they understand the need to include it in the marketing mix. The message is thus communicated and the worker bees implement as instructed.

The Agency Experience

Imagine now that the marketing manager in question is tasked with working with a search marketing agency who is to manage the PPC strategy. If the marketing manager does not understand the purpose of PPC this creates a number of challenges in effectively working together:

- Goals & KPIs: It is difficult to tie a KPI to a marketing function that is not understood. Furthermore, unrealistic expectations may be created: if a realistic cost-per-conversion is $1,000 but the marketing manager arbitrarily sets $500 as the goal, they are setting up the agency to fail. Before business goals can be tied back to PPC, it is important to understand the role that PPC is expected to play relative to other marketing mediums. Reasonable expectations need to be created so that PPC is not treated as the online marketing panacea only to be dumped later when it fails to meet the unattainable success.

- Internal Infrastructure for Success: A significant challenge lies in working with a company / department that does not possess the internal infrastructure to measure the success of the PPC efforts. For example, if the agency is tasked with driving conversions from a landing page and number of conversions is a measured KPI at the end of the month, then it is essential that the marketing manager is able to provide feedback on the value of those conversions. Without this information, how is the agency to measure the value of their approach if they cannot ascertain whether conversions are driving sales?

- (They think) PPC is Not Working: Often, it appears that PPC is not given the credit that it is due because of a lack of understanding and poor tracking of revenue attribution. When the client sees that the PPC cost is rising but sales directly from the PPC click are low, they immediately assume that the expenditure is lost. Little thought is given to the fact that PPC may have been the searcher’s first click, but the sale came with the third click, pending further research and after an organic search for the brand name.

The branding effect of PPC is a value that appears to be frequently overlooked. There seems to be this unrealistic expectation that a PPC click (thus incurred cost) should result in some form of sale or conversion, and be directly attributable to that conversion. That would be ideal – in a perfect world. Perhaps the organic click was a result of the searcher seeing the PPC ad but choosing to click instead in the natural search results. Even though this human behaviour cannot be tracked, ultimately PPC deserves the credit.

Whenever starting to work with a client on a PPC project it is important to gauge their understanding of PPC in the marketing mix. By educating clients, right from the onset, this will create a much more productive and pleasant working relationship for both parties because the project is built on delivering realistic expectations. Do not assume that even though a PPC budget has been allocated, the person managing that budget is convinced of the necessity of that expenditure. You’d be surprised at how quickly that budget could dry up if expectations are not aligned.