What is ROI?
ROI stands for an advertiser's return on investment. It’s a useful metric to understand the profitability of your marketing investments better. For example when you put money into an investment, in this case PPC marketing, ROI helps you to understand how much profit or loss your investment has earned the business.
Your ROI goal can change depending on your business or campaign needs. However, you can calculate ROI based on this handy calculation;
🧠 ROI = (Net Profit / Cost of Investment) x 100
What is PPC?
PPC stands for pay-per-click marketing where advertisers only ever pay when a user clicks on your ad. As a result, you can get your brand out there and seen by 1000s of users without paying a penny! The main platforms that utilise the principles of PPC are Google Ads and Paid Social Marketing. Lets focus on Google…
Why is ROI important?
This formula provides vital information about the effectiveness of your marketing investments. It can be expressed as either a ratio or percentage. Although it may change month to month, especially if your business is seasonal, your allocated marketing budgets should reflect this change to ensure good pacing through these external impacts.
By monitoring your ROI closely, you can make better-informed decisions and invest in the most worthwhile channels. Furthermore, it helps you to understand where your business stands in your industry environment and whether there is room for growth, new launches etc.
Top tips to maximise your ROI using PPC
Define clear objectives
Every marketing campaign needs objectives that allow for a clear path to generate positive results. By ensuring that your objectives are specific, measurable, realistic and achievable using Google Ads metrics found in-platform, you can do exactly that! This gives advertisers granular ‘mini goals’ that you can optimise day to day to help contribute to the bigger picture and hit your overall ROI goal.
Targeting the right keywords
Avoid wasting valuable ad spend by conducting keyword research using Keyword Planner. If you’re running a search campaign, keywords drive conversions in Google Ads. This is one of the staple campaign types and attracts pretty bottom-of-the-funnel, ready to buy users…especially if you target the right keywords!
Identifying and targeting the right audience
This principle applies to digital marketing as a whole! In the case of PPC, Google generates 100s of audience segments that are in-market, affinity or a custom interest identified by advertisers. These combined allow for specific targeting, again preventing wasteful marketing and directs ad spend to the most likely users.
Analyse the performance
With the above in mind, putting time into analysing performance is just as important as generating the performance with regular optimisation. You can see what’s working, what’s not and make adjustments.
Making data-driven decisions to improve CTRs and conversion rates is paramount to hitting your ROI goals! At mira, we boast years of experience and expertise in scaling brands for success. Your brand could be next…contact us today for a free consultation.