One-Quarter of SMB PPC Budgets Said Wasted

October 11, 2013

This article is included in these additional categories:

Digital | Local & Directories / Small Biz | Mobile Phone | Paid Search | Tablet

WordStream-SMBs-Wasted-PPC-Budgets-Oct2013An analysis of 500 SMB AdWords accounts suggests that the average small business spends $1,200 on PPC and wastes more than one-quarter of that total. The research, conducted by WordStream, points to 5 areas where account managers are lagging and can improve their campaigns: mobile search best practices; ad relevancy; account activity; keyword optimization; and landing page quality.

  • Lack of Mobile Optimization

According to the study, less than 1 in 5 SMB AdWords accounts use mobile-preferred ads, and only 1 in every 20 SMB accounts has enabled call extensions in all their mobile campaigns. Recent data from Google indicates that mobile search ads experience an 8% increase in click-through rate when call extensions are enabled.

  • Ad Relevancy

While WordStream says that a quality score of 10 (boosted by relevant ads) nets an advertiser 80% lower cost-per-click and a 50% discount on cost-per-action, SMBs in the study averaged out at a quality score of just 5.

  • (Lack of) Account Activity

Here’s a quick win: a little more time spent managing the accounts. Just 1% of the advertisers tracked made changes every week during the past quarter, while a majority 53% perform Ad Optimization only once per quarter. More than 4 in 10 did not add a new negative keyword in the 30 days prior to the study.

  • Keyword Optimization

While 43% of SMB advertisers did not add a new negative keyword, 1 in 5 did not use a single one during the study period. What’s more 1 in 4 advertisers relied only on broad-match keywords, and only 4 in 10 used modified broad match keywords.

  • Landing Page Quality

Finally, the study shows that small businesses aren’t sending PPC traffic to the best-quality landing pages, and many aren’t tracking conversions on their landing pages. Specifically, more than one-quarter of the accounts send all of their traffic to a single landing page, and 20% send traffic to the homepage. Less than half of the landing pages have conversion tracking installed.

It looks like SMBs have a little work to do, but there are losses to be stemmed. To try and quantify the wastage from the campaigns, WordStream put together a few estimates based on typical cost-per-click and conversion rates this year across a number of industries. On average, the researchers estimate that a shopping company might lose 569 product sales per year, a B2B company 157 leads, a car dealership 273 test drive appointments, and a finance/insurance business 126 insurance quotes.

Explore More Articles.

Marketing Charts Logo

Stay on the cutting edge of marketing.

Sign up for our free newsletter.

You have Successfully Subscribed!

Pin It on Pinterest

Share This