Friday, 27 November 2009
This article is part 4 of a series. You'll find part one here. And part 3 here.
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What can this Information Tell You?
In our example from parts 3, we expect to achieve the campaign target if we're able to send 1,980 people to the web site. But how likely is this?
Most business web sites already get visitors. Let's say our demo site gets 20 visitors per day, and that we plan to run our first campaign over a 30 day period.
That gets us 600 visitors that cost nothing. This means we have to find another 1,380 visitors from somewhere.
We have £1,000 to spend, which is a budget of 72 pence per lead. It might be possible to generate all 1,380 visitors using Google AdWords. It's worth checking with Google's KeyWord Analysis Tool to see whether or not this is likely.
The point is, we now know how much we can invest per lead. In the case of Google AdWords, you can set a maximum bid of 72 pence. You only pay per click, which ensures the campaign will come in on budget.
If your ratios are too conservative, you'll beat your target ROI. If they're too optimistic, you won't achieve your target. Once the results are in, you can use the hard data you've collected to adjust the ratios you're using.
Over time, you'll find you get better and better at accurately predicting the outcome of a campaign.
You can even use this data to predict whether or not any given advertising is likely to pay off. This alone can save you thousands of pounds by telling you when advertising is too expensive for your particular campaign.
Doing the Math
The campaign budgets and ratios I've described here can easily be tracked using a spreadsheet. In fact, the maths is so simple it can easily be tracked on paper. Another alternative is to use a campaign calculator.
A better approach is to create a plan for each campaign you do. In part 5, you'll find a handly campaign plan you can fill out and use as a basis for your next web marketing campaign. It contains everything you need to plan the Objectives phase of a campaign.