Many AdWords advertisers have asked themselves, why is my cost per conversion so high?
I’ve developed a 4 step checklist to help AdWords advertisers figure why their cost per conversion is higher than they want it to be. It’s a sequential checklist that will be useful if you’re ever trying to figure out why your cost per conversion is too high. Start with checklist item 1 and work your way down the list.
The Rothman PPC Too-High Cost Per Conversion Checklist
1. Am I being unrealistic?
If you’re cost per conversion is too high, the first question you must ask yourself is if you are being unrealistic?
Take a web design firm, for example. Say their cost per lead is $120 and 1 out of every 8 leads turned in a new client. The cost of a new client is $960.
Seems high at first glance, but what if the average revenue per new website sold is $5,000, and what if 80% of new website clients also get sold ongoing services like social media management, content development, or web hosting? And what if the web design firm knows that for every 5 clients they get, they’re going to get an additional word of mouth client in the following three months?
Now the cost per lead of $120 doesn’t seem so high.
You have to be realistic. A moving company isn’t going to be able to spend $300/month and get 40 leads. It just doesn’t work that way.
Many business owners have their head in the clouds about cost per conversion goals (among other things), and too many business owners give up on AdWords too early because they have unrealistic expectations.
If you’re not happy with your cost per conversion, check yourself, think about if your expectations are realistic, and think about just how valuable one new, solid AdWords lead is.
Are your cost per conversion expectations realistic?