If you are a business, generally, you’re going to have to allocate money to advertising. For some of our older readers, you may recall advertising in the Herald and its hefty price. But it was a sought-after platform and generally a no brainer if you had the money for it. Advertising in the Herald was expensive – around $3000 to $8000 for Saturday paper advertising.
Things have changed since the days of advertising in the Herald. Most of the traffic has moved online, with their eyeballs and fingers searching for the products and services they may be interested in buying or subscribing.
It’s safe to conclude that there is a lot of Google search traffic and eyeballs on Google’s search results – particularly the first page of Google.
If you have a website set up to an acceptable standard, Google spiders will index that website, and it will appear somewhere in someone’s search results. The question is how to appear on page 1 of Google for a keyword relevant to your product that drives quality traffic to your website – i.e. traffic that spends money.
The fast way to Google’s page 1 is Google Ads, and a sustainable long strategy to page 1 is optimising your website or Search Engine Optimisation or SEO. With SEO, you work on your website – from its technical aspects to cosmetics (design) – to organically increase its ranking. SEO is intended to make a website communicate efficiently with a search engine, so Google’s spiders understand accurately what the website is and which keywords it relates to. But, this blog will focus on Google Ads.
How Google Ads work
Overview of Google Ads fundamentals
Is there is a difference between Google AdWords Management and Google Ads Management, you may ask? Google AdWords Management is the same as Google Ads Management. The former is an older name.
What is Google Ads? Google Ads is essentially telling Google that you want your website to be on top of a search result for specific keywords. Note that keywords in Google Ads mean any combination of words or phrases relevant to your business. For example, the relevant keywords for an electrician are: “electrician in Auckland” and “24-hour electrician in Auckland”.
So you might be wondering why to use Google Ads when Google places websites for free under the fourth or fifth position of the first page of Google search results. See below the depiction and the orange arrow showing the organic sites. The short answer is because it’s hard and often expensive to increase a website’s ranking to page 1.
Note that keywords and key phrases refer to the words or phrases you’ve told Google you will pay for on a per-click basis if Google ranks your website on page 1.
Before we get into the long-winded explanation below, I’ll cut to the chase – Googe Ads costs depend on the keywords’ current bids relevant to your business. The higher the volume for those keywords, the higher the competition and the higher the price. Google generates a monthly estimated budget based on:
The volume searches for keywords;
The estimate clicks a given website will receive;
Cost per click
More simply, the formal for Google Ads monthly budget is: estimated clicks a site will receive from Google Ads x cost per click (CPC).
Google Ads is often portrayed as something far more complex than it is in reality. To find out how much is the estimated cost to advertise your business on Google Ads, do the following:
Open a Google Ads account – it’ll ask you for a budget but don’t worry, this wont cost anything; just set a minimum budget;
Configure your Google Ads account until it allows access to the Overview Panel or Google Ads main page;
Click the tools icon on the top right corner of the page, prompting a menu showing: Planning, Shared Library, Bulk Actions, Measurement, Setup, Billing;
Under “Planning” click on “Keyword Planner”;
You find suitable keywords for your business by either using “Discover new keywords” or “Get search volume forecasts”;
Once you’ve zeroed in on relatively high volume keywords that are competitive and drive quality traffic, click on them to analyse in “Forecasts”;
The end product is you seeing an estimated:
budget required for one (1) month of Google Ads
number of clicks that the budget will attract
impressions your website will receive (not super important)
Average cost per click or Ave. CPC
See the below pictures for better a better understanding:
The above picture shows a keyword search we undertook for a client who owns an IT firm. As you can see, for this client to run a nationwide Google Ads campaign in New Zealand, helpful keywords to target are:
It support services
Targeting these keywords for Google Ads will likely yield the following results and costs:
$300 per month
190 clicks, therefore a conversion rate of 3.8%
An average cost of $1.62 per click
Six (6) lead generations
The assumption is the campaign will pay for itself and probably generate a fair amount of profit if a few of the six (6) leads generated from the Google Ad campaign turn into paying customers and clients. If it goes well, this client will increase his Google Ads monthly budget, will target more keywords and iterate the campaigns based on the actual data the campaign produces – the actual conversion rates.
How do we make money from Google Ads, you may ask? We charge a management fee and a setup fee. Our management fee is 30% for campaigns under $1000 (so we charge $90 ($300 x 30%) to manage the campaign above). For campaigns over $1000, our management fee is 25% to 20%.
Is Google ads worth it
More often than not, Google Ads is worth it. The conversions, clicks, cost per click forecasts are usually fairly accurate.
However, Google Ads is not the golden goose that will generate paying customers month after month if a business does not iterate and evolve. Google Ads work, but it only works well in conjunction with a holistic digital marketing strategy. For example, if your campaign does not generate the number of conversions or leads forecasted, you have to take a closer look at the targeted keywords. Its marketing 101 – the keywords are a funnel to lead clients and customers to your business. Therefore the keywords need to be relevant and focused on attracting quality traffic. Targeting a keyword like “IT” or “Information Technology” for an IT firm probably won’t work because the term is too generic and general. But how about “IT service company for small business”? People searching for this keyword are likely to be in the market for a firm that offers IT solutions.
If the Ad camping is generating the expected conversions, i.e. leads or even outperforming the forecast, and a few or none of those leads are converting into paying customers, then you need to take a look at your product, processes and website. Google Ads aims to funnel quality lead to your business. It’s up to you to convert those leads into paying customers.
The whole point of having a vibrant presence is to appear in front of the right audience at the right time without risking overexposure or audience fatigue. If a business walks on this fine line, it generates a whole lot of trust with a well-optimised product for customers and clients. The process of putting your business online and having it viewed by a potentially worldwide audience incentives you to focus on iterating your service or products.
Google Ads is fine, but it is a paid-for placement. It is not organically ranking on page one (1) Google – your website is only on page 1 because you have paid Google. But if your website also ranks organically on page 1 of Google, it will potentially be seen twice – once in the Ad section and once below the Ad section. Besides the point that 90% of clicks go to page 1 of Google (leaving a pitty 10% for the rest of the pages), having your website appear twice on page 1 invites an incalculable amount of trust in your brand, product and website.
We usually advise our clients to start with Google Ads and then focus on SEO once they receive the revenues generated from their Ad campaigns. SEO is a long term game, so it will take a while to get to page 1.
Why Google Ads is important
I don’t want to sound repetitive, but you have a website to generate revenue. It’s nearly impossible to generate income from a website unless it’s on page 1 of Google. SEO is a long term game and costs a lot before it generates income. This leaves Google Ads the only feasible tool to quickly get to page 1 and generate revenue. Easy equation!
how much do NZ companies charge for google ads management
Digital marketing agencies in New Zealand (and most countries) often charge a management fee as a percentage of the total Google Ad revenue plus a setup fee. The setup fee is for connecting a website to Google Analytics, Google Search Console, and creating a Google Ads account.
Most digital marketing agencies in New Zealand charge a management fee of 40%. V Digital Marketing management fee is 30% for Google Ad campaign budgets under $1000 and 25% to 20% for campaigns over $1000.
Can I do Google Ads for my business without hiring an agency?
Yes, of course, you can learn Google Ads yourself and save the management fee. But it will take time, and you will likely spend a bit too much on the Ad campaigns until you gain experience. Udemy has excellent courses on Google Ads taught by the pros who have massive digital marketing agencies. Check it out.