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Google AdWords FAQ: Questions from E-Commerce CMO’s

While working with E-Commerce companies on launching AdWords programs, we’ve noticed that many of our clients have the same questions. I would like to share our answers to these commonly asked questions in order to help you better understand the requirements of the AdWords Program. In this article, I will be covering the most popular AdWords campaign type – Search campaign. I will also use the terms “products” and “services” interchangeably. Let’s get started.

High-Level AdWords Program Questions

Q: How does AdWords work? How do I explain it to an executive?

A: AdWords explanation can be broken down into three major points:

  1. Potential clients in your target market search for the products they need by typing descriptive keywords into the Google search engine.
  2. Using the Google AdWords platform, you bid on those keywords and present a compelling ad designed to attract the attention of the searchers. Your ad shows up either on the top or the right side of their search results, depending on your bid and quality score.
  3. Searchers click on the ads and are taken to the landing page for your product. If they find what they are looking for, they may convert by making an inquiry or purchase. You get charged for the click.

Q: What are the steps to launch an AdWords search campaign?

A: We recommend that you proceed by taking these five steps:

  1. Establish an AdWords account
  2. Perform keyword / market research for each product
  3. Develop an account structure for each product
  4. Develop ads for each product
  5. Launch

Q: Who handles the steps listed above?

A: All steps can either be handled by an internal marketing team or outsourced to a digital marketing firm. When deciding which, consider the following aspects:

  • Size of campaign: PPC campaigns are complex. If the size of your campaign justifies hiring a full-time person dedicated to managing it, in-house may be your best option.
  • Speed to market: If the speed to market is not an issue and you can wait at least six months for an in-house campaign manager to learn PPC campaigns, then an in-house manager may be your best option. Alternatively, outsourcing to a company that specializes in PPC campaigns may be the most efficient and cost-effective choice.

If you choose to outsource, you can launch immediately without the need to hire a dedicated full-time campaign manager. This typically results in a higher ROI since the outsourced company has more experience and specialized domain knowledge. When outsourcing, be sure that the digital marketing firm you hire provides the following:

  • Dedicated resources to manage PPC campaigns
  • Transparency
  • Ability to analyze large data sets
  • Knowledge of your industry

Q: How do you determine the duration of the program?

A: We recommend you use one of two approaches:

  • Budget-focused approach: Calculate your potential monthly ad-spend by determining the monthly search volume for targeted keywords, applying a 2% click-through rate to estimate the number of clicks you can expect, and multiplying the number of clicks by the cost-per-click for each targeted keyword. Then divide your approved AdWords Program budget by your estimated monthly ad-spend to get the approximate duration of the program.
  • Volume-focused approach: The opposite of budget focused approach, this is more applicable if your ultimate goal is search volume. Calculate your monthly ad-spend using the method above and then determine what portion of the market you need to reach.

Q: How do you measure success?

A: You can measure the success of your campaign by how well it met one or more of the following goals, depending on its intent:

  • Branding: Increase in clicks and impressions from the target audience and geographies.
  • Orders: Increase in number of orders coming directly from campaigns.
  • Cost per Action: Decrease in cost-per-order or cost-per-lead, while maintaining the order or lead volume.

Q: How does reporting work?

A: Google AdWords has flexible reporting capabilities and convenient data exporting. Reports can be exported in csv, xls, or pdf formats and can be scheduled to run automatically. Data can be cut and segmented by campaign, geography, time, search-terms and other variations.

Q: I’ve heard stories of companies losing money on AdWords. Why does that happen?

A: Losing money using AdWords is possible if:

  • Your keyword targeting is too broad
  • You geographical targeting is too broad
  • Your ads do not match the targeted keywords
  • Your landing pages do not match the ads

Some of the reason these errors may happen include:

  • Lack of understanding of the AdWords platform
  • Lack of time spent on managing the AdWords campaigns

Launching AdWords Program Questions

Q: What product information do we need before launching an AdWords program?

A: You should prepare by gathering information about the following categories:

  • Keyword targeting: Make a list of words that people in your target market are likely to enter into the search engine. This largely depends on what buying stage your target market will be in to help you reach your goals. If they are in the research stage, you can use broad keywords that focus on the problems your audience may be trying to solve. If they are in the comparison stage, you will need specific keywords such as product types or specifications.
  • Geographical targeting: Make a list of locations in which you operate or in which you would like to test-market.
  • Ad copy: Gather product information, problems it solves, comparable ads from other campaigns, etc.

Q: Can we target specific geographies first before launching a national campaign?

A: Yes. AdWords allows you to target precise geographic locations. You have the ability to drill down by country, state, congressional district, metropolitan statistical area, county, city, and/or Zip code.

Before launching, we recommend that you map out the areas in which you operate, understand the potential search volumes and then make a decision about where to target.

Q: Do we need a separate landing page for each campaign?

A: Even though it is not required, we highly recommend that for each campaign, you create a unique ad and corresponding landing page.

Q: Do we need bid automation software?

A: No. We recommend that your campaigns be managed manually. There is nothing better than a dedicated account manger who can analyze the account and make appropriate changes when necessary. Your account is more likely to be handled correctly when changes are based on real data instead of an algorithm.

AdWords Billing & Budget Questions

Q: How are we charged for the ads?

A: You are charged on a per-click basis. This means that you are only charged when someone clicks on your ad.

Q: How does program budget and billing work?

A: When getting an approval for budget, consider the following components:

  • Google Ad Spend: The ad-spend portion is set up directly with Google AdWords. The billing is done in increments. For example, you may get billed after every $500 spent on clicks or every 30 days, whichever comes first.
  • Campaign Setup/Management: The management fee will go directly to the agency, if you work with one.

Q: Can we control the budget so we don’t spend the whole budget in one day?

A: Yes. With AdWords you can set up a daily budget limit per campaign to limit your risk.

Q: What other tools can we can integrate with Google AdWords?

A: We recommend integrating your Google AdWords account with Google Analytics. Google Analytics gives you a deeper understanding of user behavior after they land on your website. You can use it to discover things like:

  • Conversion data: Leads, ecommerce revenue, shopping cart or even checkout behavior.
  • Audience data: Locations, devices, browsers, operating systems of your users.
  • User behavior data: Pages visited, time spent on each page, sequence of visits of your users.

I hope that these questions and answers have helped you better understand the various elements involved in starting an AdWords program so that you can better communicate information to your team and get approval from senior management.

For your convenience, we’ve created a template you can adapt to your organization. You can download it here in Word Format.

If you have other questions, leave them in the comments below.

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