Adwords Costing Your Small Business a Small Fortune? Diversify.

By Bradley Stockwell

Marketing Director Merchant Capital Source

If you’re a small business owner you should know of (and use) Google Adwords CPC advertising. It has become a staple for any small business marketing strategy and that is essentially its biggest downfall. Adwords is still cheap in comparison to traditional advertising, but you’ve probably noticed that year-to-year costs have increased substantially in order to maintain the same results you started with. The reason for this is simple— the cat is out of the bag on Adwords. Like any good trade secret, it doesn’t stay secret forever. By the day, Adwords is becoming more saturated with your competitors and unfortunately there’s no sign of it stopping soon. So what should you do if you’re a small business owner with a limited marketing budget? Find the next Adwords and right now its biggest competitor is Facebook Advertising.

Sure Facebook CPC Advertising still has some kinks to work out, like not having an ad scheduler, but when you look at how much cheaper it is than Adwords, you’d be unwise to not at least give it a try. For example, my average cost per click with Facebook Advertising is 95% cheaper than Adwords! And when it came to conversions, (which is what really matters right?) Facebook produces the same amount at about half the cost. While these results may not be typical for everyone, across the board you’ll find it cheaper on average. However like Adwords, the cost of Facebook advertising is only due to increase with time thanks to loudmouths like myself telling everyone.

I’m not saying you should abandon your Adwords account altogether. It is still a must-have service for any small business and there are many ways to lower your spending and maintain or increase its efficiency. First, try bidding in off-peak hours. Typically hours outside 9AM to 5PM and weekends are less competitive. Also try changing your ads and if you haven’t already, try a display or remarketing campaign. Once again this varies according to your industry, but experimenting with your Adwords account is the best thing you can do to make it more efficient and effective.

To be clear, Facebook and Adwords are completely different CPC advertising platforms and both have advantages and disadvantages. For example, with Facebook you can target very specific users based on demographics and personal interests unlike Adwords, but you’ll find Facebook users are less eager to buy than Adwords searchers. While that click may cost you more on Adwords, it’s more likely to turn into a conversion compared to a click coming from Facebook. This is because with Adwords the consumer is coming to you through a keyword search rather than you going to them. They’re more likely to have made up their mind about a purchase, they just don’t know from whom. However if you’re trying to gain exposure with a specific audience that doesn’t even know your product/business exists then Facebook has the advantage.

So what’s your best strategy? Diversify. In regards to your business (and life for that matter) putting all your eggs in one basket, or even two, is just foolish. Since joining forces with Yahoo, Bing Ads is another emerging competitor in CPC advertising. While they only control about 18% of search engine traffic, that number is growing steadily every year. You may also find Twitter’s CPC advertising to be effective for your business. I can’t tell you for certain what will work, or how many eggs should be allocated for each basket, only make you aware of them. However I can tell you, if you want cost efficiency, CPC marketing is still your best bet.

In the end, it is your obligation as a business owner to figure out a marketing strategy that will differentiate your company from your competitors and the only way to do that is to experiment and to educate yourself. This is what a successful business owner does.


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