Wednesday, November 13, 2013

4 reasons why advertising budgets are too big and how to solve this problem

The calculation of the budget of the campaign can sometimes be one of the most important tasks for online marketing specialist. Overspending advertising budget noticed at the end of the campaign means that your client will have to pay extra money, and in some cases even the marketing specialist has cover the entire shortfall.

On the other hand, to finish the advertising campaign still having some money is also not very good, as it shows that you have missed some important opportunities. In both cases, we can see an inappropriate planning of spending. This is a mistake that most beginners do, and nobody wants this happen with him/her.

Choosing the right tempo of the campaign is challenging and many different factors should be taken into account. There are four main factors influencing the successful budget spending.

1. Predictable "ups and downs"

Search is always unpredictable, and even if we can predict something, it is not quite accurate. But there are things that happen regularly enough and we can take them into account.

First, as in any other business there exist seasonal changes in the search (for example, winter is a peak time for search on the keyword "snowboard" and this word is not so popular during other three seasons). Naturally, over time, any product can become obsolete or out of fashion, then we will see low interest of customers. It is important to remember that sales slowdown will not happen all of a sudden but will develop gradually.

If you have started some kind of a large advertising campaign online or offline then "season factor" can seriously affect its course. Fortunately, it is easy to foresee. However, there are other specific circumstances for each particular case.

For example, our client works in the field of show business, he sells tickets for his concert . From the experience of previous campaigns for such clients we know that when fixing a timetable for the search volume we should note that the rate for the three weeks prior to the start of the concert will go up quickly, and ten days after the concert will go down. With this knowledge, we will always be able to use our advertising budget more effectively.

2. Unpredictable "ups and downs"

Let’s remember recent events connected with the death of Michael Jackson. There appeared so many search inquiries including the name of the singer in Google that the companies initially thought of hackers. Now imagine that you are selling something connected with the name of Michael Jackson and have not set maximum limits of the budget for your account, within 12 hours your entire monthly budget would have simply disappeared. Or imagine that you have a very limited budget and missed the opportunity to sell something to his real fans.

Another example, if the company appears in the center of a scandal, its traffic from the will increase in several times, but most users will search for "[name of company] scandal". You will have to take measures in order to get rid of such bad quality traffic. These crazy and unpredictable "ups and downs" taking place during advertising campaigns occur quite often.

3. Big advertising campaign

Hundreds of thousands of keywords at the same time promoting in three and more search systems, hundreds of projects at the same time, thousands of ad groups it’s hard to keep in mind everything. Especially if there are promotional campaigns developing at the same time, bringing new products on the market, etc. Too many dynamic components, it is sometimes difficult to cope with all this.

4. Technical problems

One of the most popular questions among beginners sounds like this: "Why did my last campaign go beyond the budget?" Well, as everyone knows, the upper limit of daily advertising budget as solid as a wet napkin.

The financial policy of Google is as follows: your daily budget can not be exceeded more than 30 times over 30 days. For example, if during the first day of the campaign expenses from your account exceeded the daily limit for $20, the next days you can spend $20 less to compensate for the exceeding the limit.

As we can see, even Google can not stay within the limits of advertising campaign budget. They have such a huge amount of advertisement that it is virtually impossible to calculate everything to the cent. As already mentioned, Google will not take more than you have on advertising account. But it will barely help, if there are more than one advertising companies in one account.

How to make right calculations of costs

You must take into account not only your own income, but also payments made for third party. For example, for "SEM management platform" should take 2-5% of media costs also do not forget about such useful tools as Gooroo, SpyFu, etc., which are not free of charge .

All these details should be taken into account when calculating your cost. All additional costs for third-party payment should be considered separately from your own income. Calculation of advertising costs is individual in each case. Sometimes spending is calculated daily, but usually weekly.

In most cases, the advertising budget is distributed evenly for the whole period of advertising campaign, in this case it is very easy to track percentage of the budget already used and how much is left.

About the author: This essay is written by Melisa Marzett. Melisa is an experienced writer and professional in such fields as internet marketing, web and social media. You are welcome to contact with her on Google+. Other articles are at

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