Spent $250 to make $70 - Drop it or optimize it?

[Gerto]

On my latest campaign I spent $250 on PPC and got 2 sales for a total of $70.

Now I was wonderring whether I should drop this campaign or optimize it?

The stats:
Commission:$35
Average PPC: $.19
CTR from landing page to merchant's shopping cart: 7%
Conversion rate of people who visit the shopping cart: 2%

It's especially the last stat that I'm a bit worried about, shouldn't this be a bit higher? I give all the information (including the price) on my landing page and then people who are interested click an "order now" button, so I'd think it'd be a bit higher.

I've calculated that with a 7% ctr to merchant and 2% conversion rate from those, I'd have to get clicks at an average of $.05 to break even, so that stat makes me think I should just drop this one!

Any suggestions?

 

[Linda Buquet]

Hi Gerto, the numbers that are most helpful are how many total clicks/visits vs total sales. That's how we calculate conversions. 2% once they're in the cart makes it sound good, but it should be 2% clicks/sales ideally.

So if you spent 250 at avg .19 per click you had around 1300 visits and only 2 sales? That's not good - only .0015%


Are you using BUY keywords? I don't just mean "buy xyy" or "best price xyz."
"Digital camera information" for example could attract lookie loos whereas Panasonic Lumix DMC-TZ5 is more likely someone who knows what they want and is ready to buy.

Are you using all the potential negative keywords?

Are there any leaks on the merchant page like a big red 800#?

1300 clicks isn't a whole lot of data to base a decision on. You could tweak KW and get 2 sales in a row if you held on (POSSIBLY, you could also lose your shirt).

But I know 250 seems like a lot to invest for such a low return.
Largely conversion is up to the merchant, so if you are using buy KW and negatives - in other words if you are sure you've done everything you can to make the traffic hyper targeted and the conversions just aren't there, then you may want to give it up.

 

[Merco]

It is a tricky situation because the numbers should push you to say STOP but you feel like there is more you can do to improve. When it comes to PPC a gold rule says that you need to optimize the campaigns if it goes in a negative away until you stop to believe in it.


The difference between 7% and 2% is significant and if you ask me the problem is that 7 percent. You need to increase both if you want to be profitable.

The advices you received in the previous posts are also important.

When it comes to PPC long-term results, 1300 clicks is not enough if you ask me. In the same time, it depends on how confident you are in this campaigns and, of course, how much you can afford to spend on testing.

Good luck!

 

[fitnfree]

Yes, this sure can be a catch-22. Last winter I spent over $2,000.00 on "testing" with such a low return it totally scared me off PPC marketing for a while. Then I tried really focusing on the keywords. I reduced my budget considerably while I did more "testing" to get a feel for how different approaches and sales pages worked.

In other words, really targeting ads to the specific item to focus on targeted traffic, not just traffic. By working it this way, costs were reduced for me and my ROI improved. PPC is tricky - keep tweaking until you find that "recipe" that gets your desired results.