SEARCH ENGINE MARKETING (SEM)

We manage over $500,000 a year worth of online advertising for our clients and typically they enjoy between FIVE and TEN to ONE ROI on their investment.  The truth is, it is actually MUCH HIGHER, but you wouldn’t believe us if we told you.

So... here’s an example of how it works with Google Search:

• Ads are typically purchased at an auction
• There is a market rate for the click on each keyword

Let’s say for “Edmonton Plastic Surgeon”, the cost per click is $5. We tell Google that we will pay $6 for that keyword to ensure we have top visibility. Google then scans your ad, the web page the ad lands on and the probability of you converting that click into a customer, how long you’ve been serving the ad, and gives you a Quality Score.

• If your score is high, you may place higher for less cost
• If your score is low, things can get very expensive
• It is a premium Google charges for putting substandard content on their real estate

Now... the math

Once we understand traffic and cost per click, we can develop a formula that can literally impact your revenue with a small margin of error.  

Using the Plastic Surgeon example, if:

• There are 10,000 searches 
• The cost per click is $5
• 1% of the searches will click on your ad and land on your site

You have spent $500 to bring 100 people to your site. Typically 3-5% of your site’s visitors will make contact and 50% of these visitors will become customers. This means that this exercise will bring the advertiser 2 customers with a cost per acquisition of $250 per customer. Assuming the average procedure is $5000 if you gave me $250 and I exchanged that for $5000 in revenue, would it be worth it? 20:1 ROI. Not bad right?

It typically takes 3 months to understand the math for a specific industry. After that, it could be reasonable to say that $5000-$10,000 in advertising has a high probability of generating up to $100,000 in revenue. It starts with creative construction and finishes with mathematical detailing.