Measuring Value, Cost and Benefit for Pay-Per-Click Advertising

A client recently asked me what kind of return (ROI) to expect from their pay-per click marketing. Hmm… good question. I pulled up 4 boutique hotel PPC accounts that all had full tracking: phone call, online revenue, visitors, etc.
Now, I didn’t cherry pick accounts, I just picked four normal boutique hotel accounts in hotels spread around the country in vacation destinations.   Consider for a moment the definition of  “Value”… value = benefit/cost.   In order to make the numbers manageable, I leveled the data to measure what benefit the clients received for every $100 spent.
Pay-Per-Click Results

Pretty nice numbers, huh?

We also had someone who experimented with taking brand bidding (bidding on brand name terms, even though the client already ranked in organic for them) on and off their pay-per click accounts. This client was a boutique hotel and was tested for several months. It would seem that bidding on your brand increases the ROI from PPC marketing:

Brand Bidding:

  • Raised their click-thru-rates by over 100%
  • Rasied their phonecalls from PPC visitors by over 500%
  • Raised their “web events” by 1000%
  • Decreased their cost-per-visitor by over 50%
  • Increased their online revenue from PPC by over 300%
  • Increased their overall online revenue by 30%

I wonder if this information on brand bidding will elicit some comments? 

Hopefully, many hoteliers and resort mgrs are reading this post saying “I don’t have this data” and are going to email me right now and ask if Blizzard can help revamp their pay-per-click marketing campaign!   Really, there are two question here: 1) can you even measure your benefits? 2)How do your metrics compare?

If you are spending a couple of  thousand dollars a month on PPC, you really should be sure you are maximizing the return on that investment.  My direct line at the office is 970-928-7875 xt. 101 if you would rather call.

Talk to you soon.

Comments

  1. Matthew day says:

    That is a nice and graphic way of encouraging your readers to join the pay-per-click business. I have always been curious about this but I felt that the ROI is too little. I thought wrong. Thanks for the presentation! It opened my eyes and encourage me to explore popc. Thanks again!

  2. I wanna talk about more on that theme, CPC always killing me. It can be pretty tricky, but you have to match your CPC to your return. If you spend 12 bucks per click but make 14 dollars in sales per click, it’s not a big deal that the CPC is high. Most of that comes from post-click optimization.

    John Oliver

  3. Return on investment is definately a hot topic. I have seen people spend thousands on Google PPC, but the CONVERSION is where it’s at. This is defanately good information to have. Thanks!

  4. I think companies are increasingly turning to PPC because of exactly these reasons – they can see when an advertising campaign is bringing returns and adjust it accordingly because all the information they need is there! PPC is a near-exact science where other advertising is much more about guesswork and estimation. Now with the credit crunch, companies need to be exact about their promotion. Thanks for the post.

  5. This is interesting, so you dramatically increased the quality score and the overall revenue simply by biding on brand keywords? I never mess with brands because I heard it could get you in trouble? Or am I missing something here? I’m pretty new to PPC advertising so this kind of information gives me Goosebumps. Thanks.

  6. Yep! Check out a more recent post that references a whole bunch of different industry research about PPC and conversion factors

    Trent

  7. Vincent says:

    So how did you track which of the reservations and calls were actually due to PPC?

    Like many, our Website will generate leads and calls without PPC, so how can we prove the value of PPC unless tracking codes can be added to each lead and be identified??

  8. This is an really interesting post, I have never got into the pay-per-click business even though I have a website myself for the past year. I have started to write some articles for it and promote it but will have a closer look at this to see if I can benefit from it.

  9. Vincent, we use Google analytics to track the online reservations and special software taht puts a unique phone number on the page when a PPC visitor hits it… so, depending where traffic originated from, the phone number can be changed. after that, we just track the inbound phonecalls from that number. Navis Technologies is a high-end provider of this service that many of our larger customers use and enjoy. Trent