Using Search Ads 360 to identify diminishing returns in PPC campaigns
How far should you take your PPC campaigns? Are you doing enough? These are the questions that may crop up throughout your PPC campaign journey. Google Ads are a competitive playing field, so it’s no wonder that you may be looking to push your campaign forward to stand out amongst the competitors.
However, sometimes going too far does more harm than good. PPC specialists might consider spending even more money which doesn’t actually amount to any higher results. So by the time you’ve tried to invest more, you actually spend more on each user’s click without improving results. This is where Search Ads 360 can come in handy. Knowing when budgets reach their peak is key.
What is Search Ads 360 and what are diminishing returns?
So, what exactly is Search Ads 360? Essentially, it is described as a ‘management platform’ by Google, allowing users to manage their campaigns and run them efficiently. Some of its features include:
- Budget bid strategies
- Automated bidding
- Reporting
- Traffic ads and keywords to the supported search engines
The list goes on! For identifying diminishing returns, the best feature to use is budget bid strategies, which we touch on a little bit later. Put simply, the feature lets you group up your campaigns that share similar goals and set to maximise their goal with a fixed budget. By slowly changing the budget, you’re able to identify the point at which diminishing returns occur. But what exactly are diminishing returns?
Diminishing returns is the point at which even when you put more budget into your campaign, your results remain the same. You’re gaining no profit as the only variable changed in your campaign is the amount of investment.
The last thing you want is for your clicks to become way too costly when you’re gaining no profit in return. Pinpointing when you reach this is vital for avoiding wasted spend and gaining sales that are actually worth your money. Remember, more money doesn’t always amount to good.
How Search Ads 360 can help with diminishing returns
So now you’ve got an idea of what features Search Ad 360 is and what diminishing returns are, but how can it specifically help? Here is how you’d implement Search Ads 360 (more specifically the budget bid strategy) to help:
Planning stages and creating a strategy
To ensure the most successful test, planning cannot be ignored. When setting up the bid strategy, a common goal needs to be decided on. This may be ROI, a monthly budget spend or impression shares. You also want to identify which keywords will be part of the test. Ideally, these are keywords that have no additional caveats that could affect the test results (e.g., inconsistent search volume, branded, different landing pages). Inputting accurate data is essential, as the test may not give the most accurate results- you don’t want to act based on incorrect data.
Creating your strategy requires you to go to the ‘planning’ section on SA 360. From here, you can add a new budget bid strategy and set specifics like the date range, KPIs, goals, and target weekly spend. There are plenty of optional settings that you can choose to make a bespoke campaign that targets your needs specifically.
Collecting and using the results
Using the results from the budget bid test lets you identify the point at which investing more budget was actually profitable for your business. Collecting this data and statistics can tell you what your optimal amount of spending is, so going forward you can avoid reaching diminishing returns. By increasing your budget each week, you’ll end up getting to the point where it’s no longer beneficial to invest that much money.
The results may also alert you that a change in strategy is needed. It’s worth focusing your attention on other factors of your campaign to drive conversions, as lack of budget is not the problem here.
Performance reporting
Aside from the budget bid strategy, the comprehensive reporting tools can also come in handy in regards to diminishing returns. You can tap into the different performance metrics that let you know if results are remaining the same (or even decreasing) despite an increased budget.
For example, an increase in CPA (cost per acquisition) but no increase in conversions should ring alarm bells and warn you that you’ve reached a point of diminishing returns.
How Embryo can help your PPC campaigns
Here at Embryo, it’s no wonder that we generate high-performing PPC campaigns when we have a team of expert specialists working their magic. As a multi-award-winning PPC agency, we go above and beyond to ensure your business gets exactly what it needs. If you feel like you would benefit from our high-quality services, then feel free to get in touch today!
Deeper insights
FAQs
Answered by Callum Leonard
Can my diminishing point of a campaign change often?
Yes, it can change often. It does depend on other conversion figures such as average order value, conversion rate, stock availability etc.
Is Search Ads 360 an additional expense or free to use?
Search Ads 360 comes at a cost and typically comes as a percentage spend of your account.
Should I be using Search Ads 360 on all my campaigns?
It is typically for a larger enterprise company, due to the costs associated. It excels in being able to manage multiple accounts, not just a singular account with different campaigns.
How often should I be checking the health of my spending on a campaign?
Every week at a minimum- ideally daily. This allows you to track if you are pacing towards the end-month goal.
Can the diminishing point be estimated?
Yes, using Performance Planner on Google, you need to understand your true profit margin/point of profitability. Google does supply profitability diminishing return curves within its performance planner.
