Article provided by Bizcommunity
Did you know that the average person searches on Google three to four times every single day and that the search engine processes over 3.5 billion searches daily? What this means for businesses is that their customers are pretty much always online, so they need to be advertising online to reach them. But when sales aren’t streaming in after setting up Google and Facebook advertising, how do they measure success?
“A common misconception that business owners have when starting out is they expect everyone who lands on their website will buy their products and services. But think of it this way, if you have a physical store not everyone who enters will buy something. They might just be browsing and may come back when they’re ready to make a purchase. It’s the same online. So you need to measure more than just your sales,” says Michelle Geere, CEO of Adbot, a provider of online advertising solutions for owners of small and medium-sized enterprises (SMEs) in Africa.
She continues, “Luckily with online marketing, everything is measurable. You can see how many people clicked on your website, how much it cost in ad spend to get them there, and how quickly they left. You are also able to see what product they viewed and for how long. All this info gives you a better picture of what your customer is doing on your website. And once you know what they’re doing, you can tweak your website to make sure your customer is more likely to buy something.”
To get started, Geere explains that there are two things business owners, new to the online space, need to consider: their click-through rate (CTR) and their cost-per-click (CPC).
CTR is the number of clicks an ad receives divided by the number of times the ad is shown on Google. In other words, if the ad is shown 100 times and two people click on it, the CTR is 2%. “The average CTR on Google search ads on mobile devices across all industries is 4% . This means if your CTR is higher than 4%, you are doing very, very well!”
With Google, business owners only pay when someone clicks on their ad. This is called a cost-per-click model. Industry averages for CPC on Google search are $2.69 (almost R40 per click).
“Ideally, you want your CTR to be as high as possible and your CPC as low as possible. But remember, there isn’t a standard for CTR and CPC – each industry has its own benchmark driven by the competitiveness of that industry,” shares Geere.