December 10, 2024

Is your PPC budget driving maximum ROI?

Bob Flavin · 6 minute read

Digital advertising has transformed how businesses reach and engage their audiences. With the promise of precise targeting and measurable results, Google Ads campaigns are an essential part of any marketing strategy. However, the reality is that many businesses invest heavily in Google PPC without achieving a meaningful return on investment (ROI).

If you’ve ever wondered whether your Google Ads budget is pulling its weight, this guide is for you. We’ll explore common pitfalls specific to Google PPC, provide actionable tips for optimization, and help you ensure every dollar spent is working as hard as possible.

Common pitfalls in pay-per-click advertising

PPC budget best practices are continually evolving. However, you should avoid these common PPC budgeting mistakes.

1. Overreliance on broad targeting

Google always suggests you use broad match targeting in your PPC campaigns and let its algorithm “do the work.” In my experience, that’s rarely effective. Being over-reliant on broad match keywords can set your account up for overspending and underperforming. For example, using broad match for “auto accident attorney” may trigger irrelevant searches like “divorce attorney” or “criminal defense attorney.” This produces unqualified traffic that wastes budget.

2. Unclear marketing objectives

Without clear goals, even the most creative and well-targeted PPC campaigns can flounder. Are you aiming for lead generation, website traffic, or sales conversions? Establishing specific, measurable objectives ensures that your paid media efforts align with broader business goals.

3. “Set it and forget it” mentality

Pay-per-click campaigns require constant monitoring and optimization. Ad performance can change over time due to audience fatigue, competitive pressures, or seasonal shifts. A campaign left unattended will almost always underperform.

4. Google Search Partners

One of the “easiest” fixes—and one of my biggest pet peeves during account audits—is serving ads on Google Search Partners. If your click-through rate (CTR) seems too good to be true alongside low cost per click (CPC), this setting might be enabled. Disabling it can save significant spend.

5. Misleading Google Ad recommendations

Let’s face it: Google’s primary goal is to increase your ad spend. Its Optimization Score evaluates how well you’re using its platform, not necessarily how well your PPC campaigns are optimized. Accounts with a 60% optimization score can still deliver the right leads if managed strategically.

How to audit your pay-per-click performance

A paid media audit is the first step in determining if your budget is working as hard as it could. Here’s how to conduct one.

1. Review your KPIs

Start with your key performance indicators (KPIs). You might already be looking at metrics like CTR, average CPC, and cost-per-acquisition (CPA), but there are other ways to leverage your historical data. You should also consider adding return on ad spend (ROAS), Search Lost IS (rank), and Search Lost IS (budget) to the mix, giving you an even clearer picture of campaign performance.

Return on ad spend measures the revenue generated for every dollar spent on advertising. It reflects the effectiveness of an ad campaign in driving revenue relative to your ad spend.
Search Lost IS (rank) indicates how often your ads are not shown due to low ad rank. A high percentage here may mean your ad quality, bid, or landing page experience needs improvement. It’s critical for maintaining competitive positioning and ensuring your ads reach the intended audience.
Search Lost IS (budget) highlights the percentage of times your ads were not displayed due to budget constraints. If this metric is high, it suggests missed opportunities to capture valuable traffic and may warrant budget adjustments or campaign prioritization.

2. Analyze audience performance

Break down your audience data to see which segments are delivering results. For example, analyze performance by demographics, location, device type, and even time of day. Are certain demographics outperforming others? Are specific geographic regions converting more effectively?

Use this information to refine your targeting. Additionally, examine psychographic data, such as interests or behaviors, to better align your ads with audience intent. By identifying the highest-performing segments, you can allocate your PPC budget more strategically and maximize ROI.

3. Review your ad content and creative

Evaluate your ad copy and calls to action (CTAs). Ads with poor creative often lead to low quality scores on Google, which in turn drives up costs. Strong ad creative is essential for maintaining high ad relevance and engagement. Focus on:

Relevance: Ensure your ad copy aligns with your target audience’s search intent. This boosts your Quality Score, reducing CPC and improving ad placement.
Clarity: Use concise, compelling language with a clear value proposition. Highlight benefits that resonate directly with your audience’s needs.
Testing: Experiment with different CTAs, headlines, and descriptions to identify what drives the most clicks and conversions. Regularly refresh your creative to avoid ad fatigue.

4. Monitor frequency and saturation

Ad fatigue occurs when your audience sees the same ad too often, leading to diminishing returns. It is smart to consistently check the click through rate trends of your campaigns on a month-to-month basis. If you are consistently seeing a drop in CTR, then you know your ads are no longer resonating with the searchers and it is time to update your ad copy and creative.

Stretching every dollar: Optimizing your PPC budget

Once you’ve identified inefficiencies in your PPC campaigns, it’s time to optimize. Here are strategies to make your PPC budget work harder.

1. Implement A/B testing

Always test ad variations and bidding strategies to optimize your Google PPC campaigns. A/B testing different headlines, landing pages, or CTAs allows you to systematically discover what resonates most with your audience. Additionally, experimenting with bidding strategies, such as manual CPC, enhanced CPC, or target ROAS, can help you identify the most cost-effective approach for achieving your goals.

By changing one variable at a time, such as a bid adjustment for mobile devices or a shift in strategy to maximize conversions, you can pinpoint what drives better results. This dual focus on creative and bidding ensures your campaigns remain relevant, competitive, and cost-efficient. Successful testing not only minimizes wasted budget on underperforming elements but also provides valuable insights for optimizing future campaigns, ultimately maximizing ROI.

2. Add negative keywords

Negative keywords prevent your ads from appearing in irrelevant searches, ensuring that your budget is focused on attracting the right audience. For example, a personal injury law firm might exclude terms like “DIY legal advice” or competitors’ names to avoid unqualified traffic.

By carefully managing your negative keyword list, you can reduce wasted spend on clicks that are unlikely to convert. Regularly updating and expanding your negative keyword list based on the Search Terms report is crucial. This strategy not only increases the relevance of your traffic but also improves your Quality Score, which can lead to lower CPCs and better ad placement. Ultimately, this ensures your campaigns are more cost-effective and results-driven.

3. Evaluating search terms

Review search terms regularly to identify shifts in how users are finding your ads. Use this data to refine keyword strategies and eliminate wasteful spending. Cross-reference this with organic data to create synergy and boost keyword performance.

Tools and techniques for smarter paid media management

Budget tracking tools

Platforms like Google Ads Budget Reports offer built-in tools for tracking spending and pacing. Tools like Opteo can also quickly identify areas for cost-saving optimization.

Attribution models

Understanding which touchpoints drive conversions is critical. Single-touch models credit one interaction, while multi-touch attribution offers a more holistic view of your customer’s journey. Choose the model that aligns with your business goals.

Clearboard

Using tools like Clearboard or other analytics platforms lets you monitor performance in real-time. Quick insights mean quicker adjustments, helping you capitalize on opportunities and address underperformance promptly.

When to scale up or dial back your paid media investment

Knowing when to increase or reduce your budget is just as important as optimizing it. Here are some indicators.

Scale up your PPC budget when:

Your campaigns are consistently hitting or exceeding KPIs.
You’ve identified high-performing audiences or creatives worth expanding.
Seasonal trends suggest higher demand for your product or service.
Note: If your campaign is performing well, there are always risks with scaling your campaigns. Those campaigns could always move back to a state where you are trying to get qualified traffic or trying to convert qualified traffic.

Dial back your budget when:

Campaign performance is declining despite optimizations.
You’re approaching audience saturation or experiencing ad fatigue.
Your business priorities shift to other marketing initiatives.

Consider seasonal adjustments

Many industries see predictable spikes and lulls throughout the year. Adjusting your paid media investment to align with these trends can prevent wasted spend during slow periods and maximize impact during busy seasons.

The role of an agency in optimizing paid media

Managing paid media campaigns can be overwhelming, especially if you’re running multiple platforms. While some marketing agencies focus primarily on a single tactic like PPC or SEO, the best partners will look at your PPC campaigns holistically, evaluating how they play into your broad marketing strategy.

Here’s how an agency like LaFleur can help.

Strategic oversight: With expert knowledge of platforms and trends, an agency can identify inefficiencies and develop tailored strategies to address them.
Industry expertise: An experienced agency understands the unique challenges of your industry. For example, regulated industries like law and healthcare require a nuanced approach to compliance and targeting.
Access to advanced tools: Agencies often have access to premium analytics platforms and insights unavailable to individual advertisers. This advantage can significantly improve campaign outcomes.

For many of our clients, we serve as a fractional marketing team, helping them get the most out of their budgets, creative, and in-house marketing personnel.

LaFleur: Get the most out of your PPC budget

Your paid media budget has the potential to be a powerhouse for your marketing strategy—but only if it’s managed with precision and care. By identifying common pitfalls, auditing performance, and optimizing your campaigns, you can ensure that every dollar is working as hard as possible.

Ready to unlock the full potential of your paid media campaigns? Contact LaFleur Marketing today and let us help you make every dollar count.