Author: Jeff Sauer
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What’s the #1 reason you want to advertise on Google? To bring in new customers, right? You want to turn internet searchers into leads, customers, and profits.
Well, I have Good News and Bad News for you.
On average, every dollar spent on Google Ads results in $2.55 back to the advertiser.
Now, you might be thinking, “That’s great all I have to do is pump money into Google ads, and I’ll get a 155% return on my investment.”
Unfortunately, it’s not that easy.
The vast majority of advertisers are either losing money on Google or just breaking even.
By and large, it’s experienced advertisers who have mastered the system that are generating profits on Google Ads. And these pros are doing much better than a 155% return on ad spend (ROAS). They are making back 5 to 10X their investment in Google.
So how can you learn the skills the pros are using and start generating 5 to 10X results from every dollar you spend with Google?
Well, that’s what we are going to cover in this Google Ads tutorial.
5-Part Profit-Driven Google Ads Tutorial
In this 5-part training series, I am going to share what I’ve learned in over a decade of PPC (Pay-Per-Click) advertising on Google.
Together, we’ll walk step-by-step through the fundamentals behind the system I’ve developed for advertising profitably. I have proven this system works while directly managing over $20 million in ad spend and has resulted in more than a billion dollars in revenue for my PPC clients.
This Google Ads tutorial is so in-depth it contains more than 2 1/2 hours of FREE video training content. So, I’ve broken it into six chapters. Each of the sections includes a downloadable resource to help you master the advertising techniques we’re going to cover together in our Free Google Ads Bootcamp.
You can get access to all these downloads by clicking below to set up a free account on our Data Driven training platform. Inside your free account, you’ll able to access every resource that goes along with this Google Ads tutorial, as well as our complete Google Ads Bootcamp program.
Alright! If you’re ready to learn the secrets behind generating profits using Google Ads, let’s get started.
Lesson 0 – Google Ads jargon and terms you need to know
Lesson 1 – How to estimate your Google Ads profit potential and set realistic advertising goals
Lesson 2- Quickly calculate your profit-driven Google Ads budget
Google Ads Glossary of Terms
Before we get to the good stuff…
I want to make sure we’re on the same page by defining some of the standard PPC terms you’ll see in this tutorial.
Experienced advertisers or PPC savvy digital marketers may want to gloss over this section. However, if you’re new to PPC advertising, this section includes lingo you’ll need to know moving forward.
A Glossary of PPC terms you should know
- CPC – Aka Cost Per Click: the amount you pay for a click on your ad.
- Searcher – A person who performs an internet search using Google.
- Visitor – A person who visits your website after performing a search.
- CTR – Click Through Rate: The percentage of searchers who see your ad, click through on the ad, and end up on your landing page.
- Landing pages – The destination webpage you direct searchers to after they click on your ad.
- Lead – A searcher or website visitor who takes action which communicates interest in your product or service. For example, filling out a web form or calling a phone number to learn more about your product or service.
- Sales Funnel – A sequence of marketing or sales material designed to attract an audience and turn them into customers. For example, a sales funnel using paid advertising might encourage a searcher to call your business. Then when that lead calls your business, your sales team attempts to convert that lead into a customer. Your ad and the sales call are both steps in your sales/marketing funnel.
- Session – A unique visit to your website that includes at least one pageview.
- Keywords – The words or terms searchers use on Google to retrieve information.
- Conversion – A conversion occurs when a website visitor performs the action intended by your ad. These actions usually involve buying a product or filling out a lead form.
- Quality Score – This is Google’s quality rating score for your advertisement. The score is based on the relevance of your keywords to your ads to your landing page and is calculated automatically by Google. A perfect quality score is a 10/10.
Now that we have the industry jargon out of the way, let’s get to the exciting stuff. Let’s talk about how to build profitable advertising campaigns on Google.
Setting Realistic Google Advertising Goals
In our first video of this tutorial, I share my five hard-and-fast rules for profit-driven advertising on Google… and we also go in-depth on Rule #1 – setting realistic, yet profitable advertising targets. If you like what you see, you can download my Google Ads Advertising Goals Model and learn more about how to use this handy tool.
One of the biggest mistakes you can make as an advertiser is not setting targets for your ad campaigns.
Setting up a new ad campaign is an exciting process. But it’s hard to be satisfied with your results if you don’t set targets. If you don’t define what success looks like, nothing will ever be good enough!
Now, don’t worry if you’ve never estimated your advertising targets before – because I am going to show you how you can produce a quick yet realistic estimate of the revenue you can earn using Google Ads. And I am even going to give you a tool that will do 90% of this work for you.
I’ll show you how to use this tool in just a minute. But, first there a few basic questions about your product or services you need to address before you can calculate your Google Ads earning potential.
Critical questions you need to answer before you start advertising on Google
Answering the questions below will help you evaluate how prepared you are to begin advertising on Google. You’ll also need to know the answers to these questions if you want to be able to estimate the revenue you can earn from advertising.
So, take a minute to go over these questions. Then, keep your answers on-hand so that we can use them in the next step.
- How much revenue do you generate when you sell your product or service?
- Has your business been successful at generating leads and sales online in the past?
- Do you have a sales process for receiving and closing leads?
- Are your competitors advertising on Google?
- Have your customers shown you love? Do you have testimonials and reviews you can use to engage the potential customers your ads send to your website?
- What is the lifetime value of your average customer? Do they purchase your product over and over again?
- Do you collect recurring fees from your customer? Or is a new customer almost always a one-and-done sale?
Calculating your Google Ads profit potential
In this section of our tutorial, I am going to show you how to estimate the revenue you can generate advertising on Google.
You’ll need access to two resources, the Google Keyword Planner and my Advertising Goals Model, to produce your estimates.
Follow along, and I’ll show you how this works.
Using Google’s Keyword Planner data to estimate your advertising market
To use the Google Keyword Planner (GKP), log in to your Google Ads account.
Then, navigate to GKP.
(If you don’t have a Google Ads account or you have never used the Keyword Planner before, this article will show step-by-step how to use the Google Keyword Planner.)
Select the GKP’s “Find new keywords” option.
Next, enter some general keywords that describe your product or service into the GKP.
For example, here are some seed keywords I am using to research the advertising market for my Google Ads training program: Google Ads training, Google PPC course, PPC training, PPC Certification Course, Google Ads Certification, free Google AdWords course.
When you start running your ads, you’ll want to be very picky about your keyword list. Right now, we’re just doing market research. So you don’t need to worry about being super targeted with your keywords at this point.
(In Lesson 4 of this tutorial, I show you how to refine your keyword list so you only advertise using keywords that are relevant to your customers.)
After you’ve entered a handful of keywords into the GKP, Google will return a list of hundreds of suggested search terms for your product or service.
Google’s keyword suggestions tend to be meh at best. But once again, we’re not going to use this entire keyword list in our advertising. We are just trying to get an idea of what the marketplace has to offer us.
So don’t bother wasting your time combing through this list of search terms. For now, we are going to export all these keywords to a spreadsheet.
How to use the Data Driven Advertising Goals Model to set realistic PPC targets
Next, if you haven’t already, opt-in to join my Google Ads Bootcamp and access my Advertising Goals Model.
This model has two tabs. One of the tabs is labeled Google Ads ROI Model, and the other one is labeled Keyword Data.
I’ll show you how to use the beautifully designed ROI Model in the first tab in just a moment. For right now, open the Keyword Data Tab. Then paste in all the keyword data you exported from the GKP.
After you’ve pasted your search term data into the “keyword data” tab, jump back over to the ROI Model tab in our spreadsheet.
You’ll notice our ROI model has different colored cells. The gold cells represent variables which you can use to adjust your projections. The light blue cells are calculations based on your keyword data and the numbers you enter in the gold cells.
Let me show you how this all comes together.
Choosing Your Google Ads goals
Remember the list of hard-hitting questions I asked you to answer before we started gathering keyword data?
Well, now is when we’re going to use the answers to those questions.
The top four gold cells in the ROI model are your advertising goals. In these cells, you want to enter the targets that represent a semi-realistic version of your ideal advertising scenario.
For example, let’s say you want your ads to produce 20 new leads per month. And, you’re willing to spend up to $250 on advertising for every new lead you get.
From that advertising, you expect to generate 10 sales per month and you’re willing to spend up to $500 to land each new sale.
Enter your goals into the gold cells, and we’ll use ROI Model to see if the data supports your advertising ambitions.
Adjusting your keyword estimates
There are only two variables in the Keyword Metric fields of our ROI Model, Expected Click Through Rate and Cost Per Click (CPC) Weighting.
The numbers in the light blue cells are all based on the data you exported from the GKP and pasted into the Goals Model spreadsheet.
Glossary of Google Advertising Goal Metrics
- Total Searches Per Month is the sum of all the monthly searches on Google for the keywords you entered into this spreadsheet.
- Your Expected Click Through Rate is the percentage of searchers you believe will click on your ads and go to your landing pages. You can set your expected CTR to be anything you want. Your CTRs from live advertising campaigns will vary significantly based on your industry, the keywords you target, your budget, and the quality of your ads. If you have no idea what type of CTR to expect for your advertising, 2% is a safe guess.
- Expected Website Sessions from PPC is the total expected monthly searches multiplied by your click-through rate. This is an estimate of the number of people that will visit your website every month as a result of your advertising.
- Low and High Range Average Cost Per Click (CPC) – If you look at the keyword data you pulled from the GKP, you’ll see that Google projected a low and high CPC for each keyword you’re analyzing. We base the average CPC in our ROI model on Google’s low and high CPC estimates.
- Cost Per Click (CPC) Weighting – This variable allows you to adjust your CPC expenses towards one end or the other of the low to high range. For example, if you believe your ad quality will help reduce your CPCs, then you could reduce your cost estimate to 50% of the average (instead of 100%). If you use the advertising tactics I’ll share with you later in this tutorial, you’re likely to find that your ad campaigns will trend towards, or even below, the low end of the CPC range.
- Your Estimated Monthly Ad Spend is equal to the total number of expected website sessions times the average of your clicks costs times our CPC weighting variable.
Estimated monthly ad spend = Expected Website Sessions from PPC * ((Low Range Average Cost Per Click (CPC) + High Range Average Cost Per Click (CPC))/2) * Cost Per Click (CPC) Weighting
Adjusting your Lead and Sales targets
The two remaining variables in our ROI model are your Website Lead Conversion Rate and your Sales Close rate.
- Website Lead Conversion Rate is the percentage of visitors from your ads that you expect to become leads.
- Your Sales Close rate is the percentage of leads you convert into customers.
Setting your profit-driven advertising targets
After you’ve entered values for your conversion variables, the ROI Model will show you if your expected results from advertising are above or below your goals.
You can adjust the variables in the model to see what type of results you need to produce to achieve your goals.
For example, using the ROI Model, you might find out you can produce a profit even if you only close 10% of your leads.
Or you might learn that your market is so competitive that your sales funnel will have to be super effective for you to hit your goals.
Either way, using this model will give you a general idea of what type of outcome to expect from advertising on Google. The Model will also help you identify the targets you need to hit make your advertising profitable.
If you’ve followed along with the exercises so far, then you’ve gathered critical information you need to know about your product or service to advertise profitably.
And you’ve set goals for your advertising based on real data.
You’ve just put together two big pieces of the profit-driven advertising puzzle. Most advertisers overlook these two steps. And in turn, they wind up wasting a lot of money (if not their entire budget) chasing the wrong advertising opportunities.
Speaking of budgets… That’s the next obstacle to profitable advertising on Google we are going to tackle.
How to Calculate Your Google Ads Budget
You can’t start advertising without spending money. And the amount you’re willing to pay Google? That’s your budget, and you need to tell Google this number while setting up your account.
Google won’t even let you start running ads until you set a daily budget for your account.
So, next week, I’ll show you how to use my million dollar Google Ads tool – The Ads Budget Calculator.
The Budget calculator is my most popular Google Ads Gadget. The resource has been downloaded tens of thousands of times and counting.
This calculator will help you project a profit-driven budget for your ad campaigns in just minutes.
And if you sell PPC services, you can also use the calculator to close more clients.
If you want to grab the Ads Budget Calculator and continue with this tutorial right now, sign up to join my Free Google Ads Bootcamp.
Otherwise, make sure to check back next week when I release chapter #2 of our Profit-Driven Google Ads Tutorial.
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