How Advertising Costs Triple in this Recession
Those of you who know me or have been following my thoughts for the last couple of years, would know that I'm a HUGE advocate of Google Adwords. There is no other advertising medium that is as scalable, adaptable, and timely. Pay-per-click in general is the most real-time medium for advertising - you can collect data and make changes to your campaign with immediate results.
Over the years I've also learned how to fine-tune Adwords campaigns to deliver only the most focused stream of traffic. I've also developed a knack for tweaking landing pages to convert visitors into paying clients or customers and maximize ROI.
All the exiting stuff in business. How to minimize the money going into the machine and maximize the money coming out.
When the recession hit in 2008, there were initially not many indicators that it would affect the pure Internet world that much. Our web design company was doing better than ever, and all of our partners reported equally optimistic results. The general consensus was that with tightening budgets everywhere, the Internet would be the most cost effect marketing plain and therefore any remaining budgets would be diverted there.
Since early 2009 though I have noticed something about our Adwords campaigns. Although conversion rates have generally been down since mid-2008, there has lately been a large increase in solicitations from other vendors. How else would they be finding us other than our advertising?
So, nowadays your advertising money is not only buying prospects, it's also buying solicitations. This is a raw deal. I don't want to pay Google for clicks from people that are going to end up bugging me. I want to pay Google for clicks from people who want to buy from me.
Unfortunately there is not much we can do about this. Rewording your ads to keep vendors away will also reduce potential customer click-throughs. All we can do is weather the storm. Once the economy is back on track, vendors will be busy again, and our ads will be mostly for prospects.
Unless of course, Google comes out with a Pay-Per-Sale advertising system. That way each lead would be more expensive, but you wouldn't have to pay for solicitations.
-Andreas
Posted: 2009-07-15 11:35:43
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