How Much to Spend on AdWords

This past Friday night I met with a client at their office for what was going to be a roundtable event. Once a month we all get together and purposely take time to go over what has, is, and will be done with their internet marketing ventures. We went over optimization, new websites to be built for different geographic locations, then finally got to AdWords.

Their AdWords campaigns are running very well, high above the 1% click through rate that Google basically says is mediocre and good. But there is one question that always comes up time and time again: How much should I be spending? Should I be spending more or less?

How do you answer this to clients? If you are a business owner, wouldn’t you like to know if you are wasting money? Or at least concentrating your advertising efforts appropriately? Well, stop asking questions and hear me out, I will show you the light.

In AdWords, stay on the Campaigns tab, click Columns, then Customize columns. There is a box to check here in the second column. (Look, I am going to tell you why to do this in a minute, just follow me here and I will explain in a minute.) Click the box next to “Impr. Share” which is impression share, then click save. Now your campaign statistics should include a column for impression share, now look at the percentage?

What does this percentage mean? It means that in your targeting geography and language (from your settings) out of every possible search based on keywords in your account, this is the percentage of searchers your ad was shown to. How does this help you? Great question! Let’s use this information to figure out if you are getting your point across to your audience. For example, in West Palm, Florida, my client had 96.17% impression share yesterday. That means that their ads are showing for almost all the people looking for their service.

Adwords SEOWhat if your percentage is super low? What if it’s in the middle? Well, as always we must try and understand a few details. If you are advertising a painting company to a specific city, there is a good chance that you could try and use your advertising dollars to get in front of the majority of searchers in the region. There more than likely won’t be a very large number of impressions. On the flip side, if you are marketing to people trying to buy discount Walt Disney World tickets, there quite possibly could be a very large number of impressions for those keywords every day. You might not want to have a majority impression share here because that might be more money than you want to spend, or even have in the bank.

So, what were you supposed to learn now that Professor Wygle has bored you to death in this college classroom with the lights out and the overhead on, with the fan humming and lulling you to sleep in the back row? That there is a way to find out if you should be spending more or less on your campaigns; use impression share and continue to increase or decrease until you have a comfortable share of the market. If you are continually reaching the high 90 percentile, there is no need to spend more money. Unless you want to try and see if doing so results in more clicks……

Anywho, as always thanks for reading. I hope this can help you or a client when trying to figure out how much to spend in AdWords.