There are a ton of different acronyms and abbreviations involved in paid advertising, and one of the most important is CPA, or Cost Per Action. CPA is a metric that measures how much an action costs. So if you’re paying to get new email subscribers, you’d be calculating the cost per subscriber. If you’re paying to get new product sales, it’s the cost per sale. If you’re paying to get new social media followers, it’s simply the cost of a new follower.
A question I’m frequently asked is this: What is the ideal cost per action?
The answer is, as low as possible, and I’ll tell you why.
CPA As the Better Metric
One thing you’ve probably seen before is the concept of penny clicks. Penny clicks are clicks, in CPC marketing, where the cost per click is only a single penny, which is typically about the lowest you can get. Some ad networks will let you get even lower, where a fraction of a penny gets you a click, but that’s typically only for ad networks that operate in a currency that’s weaker than the USD.
You’ve probably also seen articles like this one about why penny clicks typically suck. If you’re not familiar with the argument, it’s quite simple. When the action you’re seeking is a click, it’s easy to get. If you pay $1 and get 100 clicks, that seems great. Then you look at your analytics. What did those clicks get you?
Most of the time, those clicks got you nothing. Out of those 100 clicks, 50 of them bounced immediately. Of the remaining 50, 40 of them lingered on the page for maybe 10 seconds and then left, without scrolling or clicking on anything. With only 10 clicks remaining, you look, and none of them do anything. Some might scroll, one of them might click a second page, but none of them do anything beyond that.
Penny clicks don’t convert. Penny clicks don’t subscribe to mailing lists. Penny clicks don’t buy products. The majority of the time, penny clicks are either bots are people who are paid to click ads, and are paid by the volume of ads, not by any engagement afterwards. In short, it’s usually basically just click fraud.
This is why there’s a widespread caution against penny clicks. There’s an “ideal” cost per click, somewhere significantly higher than one cent. The exact actual ideal cost per click might be 30 cents, or 50 cents, or $1, depending on the industry and the audience.
The thing is, that’s for CPC, not CPA. CPA is a better metric, because the action is something you care about. Instead of a click – which is basically valueless if it doesn’t lead to anything further – your action is something tangible. Something that has real value to you. A new social media follower is valuable. A new newsletter subscriber is valuable. A new customer is extremely valuable. These actions are important enough that you can even assign a monetary value to them if you want.
Since the A in CPA is an action you care about and that has value, the C, or Cost for that action, can be as low as you can push it. If you get penny actions, well, you’re probably doing pretty well for yourself. Imagine running ads where you pay one single penny for every new product sale you make. You’d be ecstatic! Your sales team would throw a party because they found the platonic ideal of marketing.
Thus, the ideal CPA is as close to nothing as you can get it.
Now, it’s possible that with some kind of actions, you still run into the click problem. For example, social media followers might not be valuable to you if they aren’t qualified followers. A lot of the shady third party follower sellers are selling bots or people in networks that exist only to follow pages, and they don’t do anything afterward. So you do still need to pay attention to the quality of the action you’re getting. After all, that action does still need value.
How should you actually go about calculating your cost per action? Typically, you need to harvest some segmented data and do a little math. Here are your considerations.
First of all, the basic CPA calculation is very simple. Take the total cost of your marketing efforts in a given time, such as a week, a month, or the duration of a specific campaign. Then find the total number of new actions you received during that same duration. Cost per Action, so take the total cost and divide it by the number of actions, to receive the cost per action.
For example, let’s say you have a spring ad campaign that you spend $1,000 on over the course of a month. You got 500 new subscribers. Divide 1,000 by 500 to get 2. That’s $2 per 1 subscriber, so a CPA of $1. Simple, right?
Now you have to remember that you rarely have one single CPA. You can calculate one CPA for everything you’ve done across an entire quarter, if you want, but it’s not likely to be a very useful number. No, you need to segment your data down.
First, figure out different actions that have value to you. New social media followers, new newsletter subscribers, new customers, new leads; these can all be valuable actions that have different costs associated with them.
Second, figure out the different channels you’re using. This is relatively easy; just look at what ads you’re paying for. One business might be paying for Facebook ads, Google ads, Twitter ads, and ads on a local TV affiliate.
Now you have an array. You have combinations of each of these factors you can calculate a unique CPA for. For example, you have all of these calculations:
Cost per social media follower from Facebook ads.
Cost per newsletter subscriber from Twitter ads.
Cost per new customer from TV ads.
Cost per social media follower from Google ads.
And so on. Each combination of action and channel is a unique CPA.
You can get even more granular. Let’s say you’re running three different ad campaigns on Facebook. One is a standard long-running content campaign, one is a campaign focused on some timely piece of news, and one is a seasonal campaign. All three of those can have their own CPAs.
You have to decide how granular you want your data. I recommend getting as granular as possible, and then using aggregate data when you want a broader look at your overview. This gives you the best of both worlds.
And, of course, the CPA for each channel and each action can be improved in its own ways. The methods you use to optimize for newsletter subscribers will be different than the ones you use for getting new social followers, which will be different than your sales pushes to get new leads. The more granular your data, the more levers you have to pull to optimize. More options means more testing, more testing means more optimization, and more optimization means lower costs per action.
Optimizing for Lower CPAs
Now, I know I said that a lower cost per action is better, but that’s not entirely true. You need to find the right balance between a low CPA and a high action volume. Getting $0.01 per action doesn’t help you if you only get one new lead out of it. There will be a sweet spot between getting more actions and getting cheaper actions. Thankfully, pretty much all of the methods you have for lowering the cost per action are also was to improve the quality of those actions, and as such aren’t likely to make your number of actions drop significantly.
Focus on improving audience targeting. The accuracy of the audience you’re targeting is important for lowering costs. Platforms like Facebook and Google have a ton of different ways to optimize your audience, from demographics to interest targeting to geographic targeting. You need to figure out the key attributes of the people you’re trying to reach, and then optimize your targeting to reach only those people. The fewer non-interested people in the audience, the less wasted money you have in your quest for actions.
Segment your audience for multiple optimization routes. Remember that even though you might be able to consider that you have one “audience”, you actually have many smaller audiences. A company producing products for new mothers might have an audience of young mothers, an audience of older mothers, an audience of mothers of boys, and audience of mothers of girls, and so on. Segmenting your audience as narrowly as possible means you can optimize your ad experiences that much more for those people.
Improve your landing page experience. When a user clicks on your ad, what faces them? Are they on your home page? A blog post? A product page? A landing page? Optimizing your landing page experience is a crucial part of lowering your costs. Remove obstacles that distract users who land on the page. Make the page clear and its goal as focused as possible. Make sure the page loads quickly and works on every platform. There are a bunch of levers you can pull here too.
Improve your conversion process. If the user is interested in converting, what stops them? Some aspects of your conversion process can be smoothed out to improve customer flow. Are you asking for too much information on a subscriber form? Do you lack the normal trust indicators for a payment page? Are you asking for sensitive information without using SSL? Identify reasons a user might find to stop the purchase process and smooth them out.
Track multiple goals for a single click. Just because a user clicks on an ad you aim at new subscribers doesn’t mean it has to stop at measuring new subscribers. Some of those people might go on to complete other actions as well, and you can calculate them in different parts of your cost equations.
Pay attention to quality score on platforms that use it. Both Facebook and Google have quality scores they maintain. These scores serve as an indicator of various metrics – which metrics specifically depends on the platform – and can affect the costs and conversion rates for your ads. You want to learn the factors that go into them, monitor them to see where you stand, and work to improve them as you run more ads.
Rotate ads when they start to get stale. Ads lose their effectiveness over time, as people start to see the more and more, and as they start trying to reach people with less and less engagement. This is when you should rotate your ads. Change the copy, change the value proposition, change the targeting, whatever, just rotate them. Make sure there’s generally something fresh and new for people to engage with for maximum value.
Always be testing. One thing you should simply never stop is testing. Always have variations on different ads running, and calculate your CPA for each variation. This gives you an idea of which ads and which changes are performing well, and how you can improve other ads as you go.
And, of course, your ideas.
Those of you who are experienced in CPA improvements, what have you found most effective? Share with the class and you may end up cited in a future post!
The post How to Find the Ideal Cost Per Action on Google Ads appeared first on Growtraffic Blog.
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We marketers, when talking about ads, often have to reference something called the ad quality score. Google maintains a quality score, and Facebook has a relevance score, both of which are important for the successful function of your ads.
The thing is, they aren’t the only metrics that matter. In this case, we’re talking about another metric that Google maintains, something called the Landing Page Experience. The LPE is a way Google uses to measure the landing pages you use for your ads.
Your landing page is the page users land at after they click your ad. Your landing page experience is, in the words of Google, “Google’ Ads’ measure of how well your website gives people what they’re looking for when they click your ad.”
Your landing page experience is a metric for each ad – since different ads can have different landing pages, and different ads to the same landing page can have a different level of congruence between ad and landing page – and it’s part of the ad rank that goes into calculating your CPC and ad auction position.
In other words, a poor landing page experience means your users aren’t getting the messages they think they’ll be getting. It can be anything from an ad promising 15% off and the landing page only showing 10% off, to a landing page advertising shoes when the ad promoted shirts. A poor landing page experience means your ads are going to cost more and you’ll have a harder time getting premium positioning, as well, so it’s always in your best interests to improve your experience.
Keep in mind that your landing page experience is a partially subjective ranking. There are algorithms and an automatic system that parses your ads and your landing pages, but Google also uses individual human raters to help rate and rank your landing page experience as well. This leads to a little bit of variability in landing page ratings, but it’ll average out in general so it’s not really a big deal.
Checking Your Landing Page Experience
Unfortunately, there’s no easy way to check your specific landing page experience. The best you can do is check your overall ad quality score, which includes landing page experience as part of the calculation.
To do this, log into your Google Ads account and find the Keywords section on the page menu. One of the columns is Status. Look for individual keywords and either hover over them or click/tap them to see a rating. This rating will typically be generic, like “above average” or “average” as calculated based on the various quality score metrics.
Here are my top tips for improving your landing page experience. Keep in mind when you’re checking that it can take a bit for your quality score to update once you’ve made some changes. For landing page experience specifically, Google says “You might not see an immediate impact, but you may see results within days or weeks.”
Make Your Landing Page Content Original
This is a generally good tip for landing pages across the board, though it doesn’t necessarily apply to every landing page. What do I mean?
When you’re split-testing different landing page variations, you might end up with several iterations of a landing page that are virtually identical, except the positioning of an image or the color of a button. This is fine. Google understands that businesses run tests like this.
You do run the slight risk of a duplicate content penalty if you do this too much, but you should be fine if you canonize your main landing page using the meta tags on all of the variations. Don’t worry too much about it though; Google is smart enough to overlook minor mistakes.
You should also make sure your landing page isn’t broadly copied from other landing pages in your industry. This is a common issue with affiliate marketers who buy template-based sites with landing pages that all look basically the same. You might find 100 sites shilling the same affiliate product, all with the same landing page template and largely identical copy. All of these sites are going to perform worse than average because there’s nothing original about their landing pages.
Make Your Landing Page Content Useful
Remember that your landing page should be useful to the user as they arrive on the page. They are searching for something, and they typically have a purchase intent, or at least the intent to research a future purchase. They’re looking for something specific, whether it’s a specific product buy button or information about a product. Your landing page needs to provide that useful information to that user.
A large part of this is about understanding user intent when they’re searching. If a user is searching for information about, say, home security cameras, your landing page is going to do best when you’re providing information about multiple camera systems you sell and the pros and cons between them. A comparison page does best in this sort of scenario. Conversely, if a user is searching for a specific model of a home security camera, landing them on a comparison page isn’t going to give them much value. If that specific model is one of several, it CAN be useful, but you’re generally going to get better results if the landing page is specifically focused on that one camera model.
Make Your Landing Page Content Relevant to Your Ads
Congruence is the most important word for this tip. Congruence means “agreement or harmony; compatibility.” In geometry, two shapes are congruent when they share the same shape and size, though their orientation may be different.
In advertising, congruence is the flow of relevance from ad to landing page. This is a case when details matter, and it’s also relevant to user intent. Congruence and page utility are both important.
For example, if you’re promoting a sale on your product and your ads say it’s 10% off, the landing page should also say that the price is 10% off. If you’re promoting a specific model of home security camera in your ads, your landing page should be 100% focused on that model. The point is to make sure that there’s as minimal disconnect between ad and landing page as possible.
Keep in mind that you can use advanced ad targeting to enhance congruence. For example, if you run ads that bring users to your website for the first time, your landing page can be focused on basic explanations and first-time impressions and FAQs. If you then make a remarketing audience out of those visitors and run ads targeting those people, your landing page for that ad can answer more advanced questions and assume a basic level of familiarity with your offering.
Make Your Website’s Contact Information Clearly Accessible
One of the elements that goes into landing page experience as far as Google is concerned is the transparency and trustworthiness of your website in general and your landing pages specifically.
One of the factors that goes into that is how accessible your business information is to users. I know that one of the typical pieces of advice for landing page optimization is to give users as few links as possible to send them places other than the purchase/conversion process, but these links are exceptions.
You want to provide a way for users to read more about your business, and ways for them to reach out and contact you if they so desire. Typically, I find this boils down to two pages: an About Us page and a Contact Us page.
The About Us page should tell details about your brand, your story, and your history. This helps users feel good about making their purchase when, for example, they know you aren’t some shell company running drop-shipping for a product they can buy cheaper elsewhere. Even if that’s what you’re actually doing, you can dress it up nicely in an About section.
The Contact page makes your business seem more legitimate as well. By presenting various generally accepted means of communication – ranging from email to web chat to a phone number and even a physical address – you assure users that you’re a real business. It’s best if you have offices relatively local to the user – a USA headquarters for a business selling in the USA rather than an office in India, for example – but you shouldn’t lie about it either.
Make Your Business Trustworthy
However, your landing page can also include some elements of trust outside of just those factors.
Use SSL on any page that has a form for users to fill out, or even site-wide SSL for maximum trustworthiness across the board.
Use a trust seal users will recognize as something that lends legitimacy to your page.
Clearly and obviously disclose any sponsored or affiliate links, as per FTC disclosure rules.
Use elements of social proof, such as customer numbers or specific testimonials, to improve user trust.
Making your business trustworthy is a huge part of gaining not just immediate sales, but long-term repeat customers and brand advocates.
Make Your Landing Page Mobile Friendly
It should come as no surprise that one of the elements of landing page experience as far as Google is concerned is the ability for mobile devices to navigate the page. This means a few things.
First, it means setting a viewport that mobile devices can use to adequately view a page. A viewport can be dynamically adjusted, as per responsive design, and is a huge part of modern compatible websites.
Next, it means making sure all of your text is large enough to read on a mobile device. Many of us are used to relatively small text on webpages – though that’s changing – but mobile devices often have lower resolutions and fuzzier screens making it difficult to read small text. Bump up that font size, friends!
You also want to make sure your clickable elements are distinct and far enough apart from one another that there’s no way to “fat finger” tapping the wrong one on a mobile device.
It’s pretty unlikely for a landing page, but for your website as a whole, you should make sure you aren’t layering it with scripts and ads such that it becomes difficult or impossible to view the actual content of the site. Personally, I dislike Mediawiki for this reason; it ends up so covered in ads that the user has to spend five minutes just digging to find the content they came there to see in the first place.
Make Your Site Load Faster
Site speed is another important aspect of site quality as far as Google is concerned, and that applies both to mobile and desktop versions of the page. It’s also a factor for more than just landing page experience; site speed is a known factor for Google search results ranking as well.
There are a ton of different ways you can speed up a site – enough that it’s worth an entire article – so I highly recommend reading a detailed guide and putting as many of those tips into practice as you can. Site speed is very important today, and it can boost your landing page experience significantly.
Once you’ve implemented as many of these tips – for both site speed and for general landing page experience – as possible, you should start to see improvements to your ads and quality score across the board.
The post How to Improve the Landing Page Experience of Your Ad appeared first on Growtraffic Blog.
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