Choosing the Right PPC Budget
When it comes to determining a budget for a PPC campaign, many people do not have what you might call a "robust" budgeting strategy. Rather, more often than not, these people end up selecting a budget amount at random, settling on a figure that's not too high, not too low, and allocating that amount toward what they hope will be a stellar PPC campaign. However, look a little closer, and you will find that these same people have not so much "allocated" their money toward a PPC endeavor as much as they have "donated" their money to an all-too-willing search engine. In other words, to choose a budget at random and then to leave it alone is essentially to throw your money to the wayside.
For those who are serious about formulating an effective PPC budget -- one that yields the best returns for the company's overall budget -- a good stat to keep in mind is that marketing budgets traditionally make up 10% of annual revenue. Now, after you've allocated part (if not all) of that 10% to a PPC project, the only way to fine-tune your budget so that it reaches its optimal amount is to test, test, test. (Then test some more.) Of course, regardless of whether you are a large or a small company, you should be focused on marketing, because marketing adds to your sales pipeline. However, in the case of SEM and PPC advertising, smaller companies in particular might be better off consulting the Rule of 100. This rule asks you to devote a fresh $100 of your operating budget to your PPC campaign, and monitor how quickly that money is spent. It goes without saying that you must be careful about the keywords you choose to test -- if your keywords are priced at $10 a pop, a $100 is equal to 10 clicks. If you go after more expensive keywords, your budget will disappear after only a handful of clicks.
After a few weeks of testing, you will easily be able to determine whether you need to increase or decrease your daily/monthly/yearly PPC budget. PPC budgeting is definitely one area where consistency counts more than flashes of insight.
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