Is Google AdWords too Expensive for your Small Business?

Google AdWords, under the right circumstances, is a great way to reach out to new customers. However, it is not for every small business. Google AdWords can be expensive - which is not so bad if you are actually getting new customers. However, if a Google AdWords campaign is not managed correctly it is surprisingly easy to spend a lot with little or no return. So, what are the traps small businesses need to be aware of before deciding to use Google AdWords?


1. Understanding what type of small business you have

If you sell low cost products or services, especially in a competitive industry, Google AdWords can just be too expensive. The general rule is that if you are selling a product or service for less than $100 then it is likely that Google AdWords will be too expensive. This is because the cost per click (ie how much Google AdWords charges you each time a person clicks onto your website) can be anywhere between $5 and $50 (and more) - depending on your industry. Not everyone who clicks onto your website will buy your product or service. In fact, anything above a 3% conversion rate is considered very good. That means you can expect 97 out of 100 people to click onto your website and not buy anything - so it does not take too long for you to spend more on advertising on Google AdWords than the value of what you are trying to sell.


2. Not investing in your website

A lot of people do not realise that it is your website that 'makes the sale' not Google AdWords. The only thing that Google AdWords does is get people to your website. If you have an outdated or badly designed website you will quickly find that you are spending lots of money on Google AdWords with little or no results.

Time and money needs to be spent to make sure that when people click onto your website that you can find the information quickly to make the decision to buy the product or service you are selling. This means they need to go to a landing page (not your home page) that talks about exactly what you are selling. For example your business does both air conditioning and heater repairs. It is summer so you are advertising your air conditioning repair services on Google AdWords - so you need to make sure that you take your potential customer to your air conditioning repair page and not your heater repair page.

The added benefit of having specific landing pages is that it will help to reduce the cost of your Google AdWords campaign as Google rewards websites that have specific landing pages with a lower cost per click.


3. Not spending enough on Google AdWords

If you do not want to spend very much on Google AdWords it is probably best not to advertise at all. Given that a 3% conversion rate is considered a good rate, if you do not spend enough you will not get a sufficient number of people clicking to your website to get any sales. As a minimum, based on an industry that is not too competitive, we recommend that you  spend at least $300 per month (exclusive of any management fee) on Google AdWords advertising. Any less will probably just be a waste of time.


4. Thinking you can only use Google AdWords for marketing

Google AdWords is a great tool to advertise your small business - but it is not the only one. There are lots of way to get people to your website. One of the other ways is to engage Search Engine Optimisation (SEO) services.  Although it can take some time to see SEO results it provides long term outcomes and is very cost effective when it works well. It complements Google AdWords which, although more expensive, provides quick results. What generally happens is that reliance on Google AdWords decreases when SEO starts to 'kick in'.

Google AdWords can be a great marketing tool for your business but you need to take the time to make sure you are spending your advertising dollars wisely.


Dynamic Websites creates stunning yet affordable websites.  Click here to find out more about our website packages Click here to find out about our online marketing services. Email John at john@dynamicwebsites.com.au or give John a call on (03) 9078 3319 to find out more about all the services we offer.

Dynamic Websites is one of Melbourne's leading web design companies for small and medium sized businesses, based in Hawthorn. We understand what it takes to get a business online. We specialise in providing exceptional web design services and digital marketing services. Our digital marketing expertise extends to Google AdWords, search engine optimisation, content marketing, social media marketing, email marketing and blog writing.