How to Get More from Your SEM Budget
Search engine marketing has long been important. But with brand reach going down on social media, and organic content discovery getting increasingly competitive, the role of SEM has only increased. It is pay-to-play marketing world now, and that means SEM.
“As with anything, there are nuances for every industry and product,” says Christine Vincent, vice president for the Center for Excellence at digital advertising platform, Kenshoo. “But generally speaking, SEM is hugely important as it is one of the few channels that captures actual user intent.”
That often suggests a healthy marketing budget for SEM. But just throwing money at SEM is not enough. As with all marketing channels, the devil is in the details.
With that in mind, here are six keys for getting more for your SEM spend.
1. Narrow Your Parameters
Niche keywords are your friend as a SEM marketer. Common words are targeted by everyone, with cost-per-click to match. Uncommon and highly specific keywords offer much better value if you can uncover them through thoughtful audience analysis. This analysis pays off big for your SEM budget.
“For example, you’ll likely have to allocate a larger budget if you are going after the term ‘car insurance,’ which gets about 368,000 monthly searchers and has a cost-per-clicks between $37 and $101,” notes Max Serrato, a PPC specialist at search engine marketing agency, Directive Consulting. “This is drastically different than if you’re going after ‘custom fish tanks,’ which gets about 2,400 monthly searches and has a CPC between $0.31 and $2.18.”
2. Focus on Top Performers
Conversion metrics are critical for properly allocating SEM budget. Instead of chasing several terms, own the terms that give the biggest return on investment for your brand. Once you rule the best-performing term, systematically move on to the next-best performer.
“Pay attention to conversion metrics such as conversion rate and cost-per-lead. The top performers should get spend priority to make the most out of your SEM budget,” advises Serrato. “If the top performer is already at close to 100 percent impression share, move on to the next best campaign.”
3. Get Good at Conversion Rate Optimization
Ad clicks are important, but the real goal is conversion once a visitor has arrived at your landing page. That’s why conversion rate optimization is a big part of winning SEM and getting more from your ad budget.
Focus resources not only on choosing the right ad campaigns, but also optimizing the conversion rate once the ads have done their job.
“Create an internal team that is laser-focused on conversion rate optimization,” advises Vincent. “The small increases in on-site conversion rates will make marketing dollars go further by decreasing friction as much as possible for the end user.”
4. Know Your Metrics
SEM is a data-driven discipline. You won’t maximize the effectiveness of your SEM budget unless you have a clear understanding of your goals and key performance indicators.
“Define the primary goals for SEM, and set some preliminary target KPIs,” says Vincent. “Are you primarily driving brand awareness or customer acquisition, retention, etc.? Define target cost-per-acquisition or return on ad spend values, too.”
Avoid running on auto-pilot or your gut, and make data-driven decisions based on a mix of reporting and measurement tools such as conversion data combined with incrementality testing to validate and iterate your SEM operation over time.
5. Let Automation Drive Your SEM Operation
Along with metrics, automation is another key for better SEM spend.
“Free up time by utilizing automated bidding to allow for greater focus on qualitative optimization on keywords, creatives and structure,” suggests Vincent at Kenshoo. You also will get better results from adding internal data to the auto bidding, she says.
Automation can help set SEM spend, too.
“Consider setting automated budget parameters to allow yourself to leverage a higher daily budget without going over your total budget (immediate vs. smoothed serving),” advises Brad Holly, founder of data-driven digital marketing agency, Actuate Media.
He says one mistake that many marketers make is setting SEM budgets that are too low and don’t take seasonality into account. If a campaign is working, let it keep running. Similarly, don’t throw money at a campaign just because a budget has been allocated. Automation can help smooth this out.
6. Consider Your Pipeline When Budgeting
While SEM is a critical channel for most marketers, it isn’t the only channel. Sometimes SEM is effective but not as effective as other opportunities. So figure out where SEM makes a difference, and where it is less effective than other channels. Let that guide your budgeting.
“Understand how SEM affects your sales pipeline,” says Serrato at Directive. “Is it a lower cost/sale than other channels? Higher? Depending on how it compares to other channels you are utilizing, you may want to allocate more or less. But, you’ll need to be able to determine the impact of each channel first.”
Used efficiently, SEM plays an outsized role in the marketing mix today. But only if you do it right.
