What’s the first thing that comes to mind when you think of ways to increase sales from your AdWords campaign (or any marketing campaign for that matter)?
Probably increase your budget right? If you’re investing $X per month to generate Y sales, then you should be able to double those sales by doubling your ad budget. Sounds logical to me. But is that really the best option? And what if you can’t afford to increase your current budget?
In almost every ad campaign I have ever reviewed, increasing the ad budget was not the best option to generate more sales. Throwing more money at a problem is rarely the answer. :)
Can You Increase Traffic?
One option you may be thinking is to increase your traffic from your ad campaign. Logically this makes sense because if you increase your traffic, then you should increase sales as well. Let’s take a look at the basic formula that determines your ad cost (e.g. your ad budget):
Total Ad Costs = (Total ad clicks) x (Cost per click)
Bear with me a minute because this is important to understand. I’m showing this formula to highlight the fact that your ad budget is determined by two variables: 1. total number of clicks on your ads, and 2. the cost per click of the ads. So if your ad budget is fixed, then as one of those variables goes up, the other must come down.
Therefore, the only way to drive more traffic (clicks) would be to reduce your cost per click. Cost per click is primarily determined by competition, which is out of your control.* So if you’re thinking you can increase sales on a fixed budget by driving more traffic, then I hope you see that is not a good option. The laws of math are against you on this one.
*Note that there are ways to decrease your cost per click by increasing your Google AdWords Quality Score. That topic is beyond the scope of this article and it’s often not where you’ll get the biggest bang for your buck.
The One Variable You Control
I’m going to show you one more equation. I promise this will be the last one. Your total number of sales from your ad campaign are determined by this formula:
Total Sales = (Total ad clicks) x (Sales conversion rate)
We already proved that on a fixed budget your best option is not to focus on driving more traffic, or ad clicks. So that leaves us with your sales conversion rate! Your conversion rate is ratio of people who click on your AdWords ad and then become a lead or paying customers. And your conversion rate the one variable you completely control, so that is where you should focus to increase sales on a fixed budget.
Key point: If you can double your conversion rate, then you will double your sales without spending a penny more on your ads!
The 3 Factors That Determine Your Conversion Rate
Knowing where to focus is really only half the battle. Now we need to look at the different ways to increase your sales conversion rate.
There are a lot of different factors, but they all boil down to the following:
- Your offer. This is most likely your biggest opportunity to improve. With Google AdWords, the advertiser with the best offer generally dominates the market. Not necessarily the highest quality product or service. The best offer that matches what your prospects really want.
- Your landing page. Assuming you have a compelling offer for your market, then your next opportunity to improve is probably your landing page. This is where a lot of advertisers fall flat on their faces. First of all, your landing page needs to reiterate your offer. That should be obvious, but take a look at your landing page and you may be surprised to see that your offer is nowhere to be found. Secondly, don’t make your prospects think. Make your landing page so simple that my 7 year old niece could figure out what to do. Seriously, it should be that easy.
- Your ad copy. Think of your ad copy like a golf tee. If you’ve ever played golf, then you know that your tee needs to be at the right height or else it’ll screw up your drive. Too low and you’ll top the ball. Too high and you’ll skyrocket the ball. Your ad should “tee up” the conversion on your landing page by presenting your offer and priming your prospect to take action.
So if you have a fixed AdWords budget and you’re looking for ways to drive more sales, then focus on the 3 areas listed above. Before you get lost in the sea of Google AdWords reports, first take a step back and make sure you have the right offer, landing page, and ad copy for your market. Without those 3 elements in place, you’ll always struggle to drive more sales with your ad campaign.