talk to Jordan White with Google, so let’s give him a call.
Speaker 2: It’s time to get into the main discussion. Here we talk about tips, tricks, and tactics to help your business acquire more leads and get more customers. Let’s do this.
Jordan: Hi, Mike. How are you doing?
Mike: Pretty good, Jordan. How are you?
Jordan: I’m doing good. It’s a wonderful day. It’s, in fact, great weather.
Mike: What’s it over there? You’re in Arizona, right?
Jordan: Yeah, I think 75 degrees here.
Mike: And it’s about 25 over here in the northern part of Texas at the moment, so I’ll take your weather. I appreciate your jumping on the phone. I was just mentioning on the podcast that we’re focusing this particular podcast on the campaign level, and what I’ve talked about so far is the fact that there are three parts to the campaigning account: the campaign, the Ad Groups within it, and, of course, the Ad Groups have ads and key words and negative key words associated with them.
Jordan: Got you.
Mike: So what I’d mentioned a little bit before in the podcast is that I was going to ask you a couple of really important questions related to ROI, or return on investment. Specifically, there are a lot of potential Google AdWords clients who were concerned that it’s going to be just a big money thing. They’ve heard the rumor about how people spent all of this money using Google AdWords, and they didn’t receive anything for it.
Jordan: Got you.
Mike: And then the second item was going to be on budget. I think sometimes people think that, in order to reduce the risk of their campaign, they need to spend a small amount each day and that there are a couple of different ways to help reduce that risk, rather than trying to do it with the lack of money, which in fact can hurt you as well.
Jordan: Absolutely. Yeah, big budgets can hurt you, and small budgets will hurt this as well.
Mike: All right. So do you have a preference on it? Would you like to talk of ROI first, or budget first, or…
Jordan: We can do the ROI. I’m ready for that one.
Mike: Let’s do it. So when a company is looking and trying to make sure that they get a good ROI on their Google campaign, what are some of the things that people come and ask you about?
Jordan: With ROI, obviously that’s one of the things that a lot of businesses are focusing on, if not every business. But what they really are asking is, “Am I going to make money doing this?” And so the answer is, I “It depends.” It depends on how you structure the account. Now, it all comes down to cost. So many people will set up a campaign, and they’ll run it and then if they spend a thousand dollars, $2,000, they don’t get anything, and then it’s a lots of cost. But it really comes in the preparation, and that’s something that’s all hard money the entire time. But it comes in the preparation, before you even set up the campaign.
You need to really look at your products and services and say, “I have 10 products. This is how much they cost me. This is how much I’m making every time I sell one.” And so you want to take those numbers and actually do math. I know people don’t really like doing math much, but you have to actually take those numbers and subtract it and say, “What is going to be the price I sell it for, minus the cost it takes me to make it?” And then that’s going to be the amount of money that you have do marketing for that product.
Now obviously, you don’t want to put all of the profit that you would make from that product, or from the ten products, into advertising. You want to segment it out. But, overtime, as you begin to get some conversions, you’re starting to get your ROI up there; you’re going to start to see a change for the good. Now, in ROI, it’s also important that you understand that, with AdWords, it’s not like an instantaneous thing. It’s not just that I plug in my name and my website, and then I run it and it’s going to be gold. Again, you have to make sure you’re preparing for this stuff. But if you’re not going to prepare for it, then there’s really no point in doing it.
You will spend a ton of money, and you will not get …