Google Adwords CPC Going Higher — How to Manage Your Costs

Have you noticed that Google Adwords CPC are going higher and higher? Is it scaring you?

First, as in any marketing, the most obvious up front costs aren’t the things to pay attention to. It’s the cost to “acquire a customer” that’s the most important, not the Cost Per Click, CPC.

I’ll show you how to get control of your marketing so that you BUY a client everytime you spend your marketing dollars.

Let’s  take a look at some examples.

Let’s use an easy $1 click-thru cost for our example.  Let’s assume that your landing page conversion rate from traffic to calling you is 10%.

That says that you have to have 10 visitors on the landing page, or 10 click thru’s to get your first call. Therefore, that call costs you $1 each times 10 click thrus, or $10 a call.  $10 per lead.

And let’s say, for a minute, that your sales close ratio is 50%. You are closing every other caller. Therefore, your cost to acquire a customer is now $20.

If you are selling a $20 candle that won’t work, but if you are selling something with a profit margin of maybe $40 or higher it’s starting to make sense. Obviously the higher the profit margin the better. If this is a $1,000 a month coaching or training program the $20 is a really fantastic cost to acquire a client.

In fact, I usually ask my clients to define what they’d be willing to pay to acquire a client, and the discussion gives them a real aha moment when they realize that they could actually spend more than half of their total profits and still make their business work well.

Of course, we want to work on acquiring clients at the best price we can, but, the point is don’t let the costs scare you. If it’s profitable, let’s crank up the number of clients we get, and then we’ll optimize the cost to acquire them.

But, let’s look at where most business owners are. The average website landing page typically is getting about one call out of over 1,000 visitors. So, let’s run those numbers again.

$1 per click thru, and 1 call out of 1,000 visitors means that that call cost $1,000. And if you close 50%, that customer cost you $2,000 to acquire.

That’s starting to be a bit expensive for many website owners unless you are selling a $10,000 item or service. So, in this case we’ve GOT TO FIX that landing page conversion rate.

Now, let’s take an even deeper look. Your conversion rate on that landing page is dependent upon your marketing message, what you say, how you say it, and who you say it to.

The problem isn’t the Google Adwords ad, it’s the landing page marketing message, what YOU tell the visitor. And if it’s not working well on the website, it’s probably not working any better in just about every other place you use it, networking, brochures, business cards, etc. Your website is just a simple indication of how well your marketing message works where ever you use it.

TIME TO FIX IT don’t you think?

In fact, I tell my clients that increasing your sales by 100 times is easy. Just imagine that if you have 1,000 people hearing your marketing message and only one calling you. Now if we change the marketing message so that 10% of them call you, that’s 100 calling you, an increase of 100 people which is also an increase of 100 times your current income.

The key is to develop “your cost to acquire a client” with whatever kind of marketing you are doing. And then GO BUY them. So, with Google Adwords, if you find that you can buy a client for roughly $20 and you have a profit margin of $100 or more, how many of them do you want to buy . . . go do it.

If the cost to acquire a client is even $40, you are doubling your investment, turning $20 into $40 everytime you spend the $20. Still not bad.

I’ve had client who would go into near panic when we talked about the cost of a click thru from Google Adwords and just couldn’t make the commitment. No matter what kind of marketing you are doing the first thing you HAVE to do is design a marketing system where the conversion rate of your marketing message DRIVES THEM CRAZY, and that’ll make your client acquisition process really effective and inexpensive.

If you’d like to explore ways to increase your current client acquisition rate by 100’s of times, call me and I’ll show you how to multiply your results by 100’s of times.

Call me, 816-415-8878. I’ll show you ways to multiply your results. No charge.

Alan Boyer

Helping small business owners reach another $100K to $250K within months and to stop playing in the kiddie pool when it comes to acquiring customers.