Does Buying Google Ads Make Sense? A Few Questions From A Google Ad Revenue Infographic

The inforgraphic above was written up in a recent article on Wired.com (Who Buys All Those Google Ads? An Infographic Breakdown).

I’ve been buying or managing Google Ad buys for myself and for Companies very large and small for many, many years now and will generally say that used correctly – they’re an amazing resource.  That being said, after looking at some of the data in this infographic I had to wonder what was behind some of the information.

First, I generally wasn’t surprised by the Top 10 list of industries.  Finance and Insurance are always a surefire place to expect money to flow from.  I was a little surprised not to see “lawyer” or the name of some medical issue like “mesothelioma” help buoy an entire industry to the top of the list but I’m sure that’s on the overall top keyword lists.

A great part about this graphic is that you can see what the top 5 keywords are under each industry’s area.   The first one that jumped out at me was “Zumba dance dvd.”  Really, a $5.18 cost per click (CPC) for a DVD?

So, I did the search, clicked through on the top result (at time of writing: Amazon) and quickly realized why they were willing to pay $5.18.  The first two results on the Amazon page were Zumba DVD Systems that retailed for $54.95 and $77.50.  So, believing that Amazon is generally a genius at making money and managing campaigns and margins I quickly realized it had all the elements of a good strategy – a self-sustaining optimal level of keyword cost vs. ROI.

Very often I see conversations about AdWords focusing solely on the CPC factor.  Well, CPC doesn’t matter if there’s the right value after the click.  The company paying $43.39 for the term “Self Employed Health Insurance” may not make every click convert, but if they’re managing the campaign correctly the long term value of a customer greatly outweighs the cost.

So, next time you’re looking at your AdWords costs make sure to take into account the entire value chain of the person clicking.  I’ve been in situations before where the “client” wanted to be in the number 1 position, no matter what the cost, and didn’t have any type of goal on the other end – only awareness.  That strategy merits another post for the good and bad sides of it, but for now let’s just agree that buying Google AdWords can make a lot of sense – if managed correctly – even if it means that we all spend enough to have 96% of Google’s $37.9 Billion revenue in 2011 be from our ads.

Matt Kane

Share and Enjoy:
  • Facebook
  • Twitter
  • LinkedIn
  • StumbleUpon
  • Digg
  • Google Bookmarks
  • Print
  • del.icio.us

Leave a Reply

Your email address will not be published. Required fields are marked *