“My sales are down, what should I do?”

Years ago, I was a member of an online business forum. And I’d see some pretty strange questions. One popular one was, “My sales are down, what should I do?”

What was even stranger was the advice they’d get. Just bizarre.

What you shouldn’t do

Most of the advice would be along the lines of, “Learn SEO so you can get more traffic.”

There are three problems with this:

#1: SEO takes time to learn and do. (Even if you can find a good teacher.)

#2: Not everyone is suited to SEO.

#3: It doesn’t solve the problem.

Here’s the thing…

I’m a great believer in ‘the law of cause and effect’ – that if you’re seeing an effect, there must have been a cause.

So, if you were getting 100 sales a week, and now you’re only getting 50, something happened to cause this.

And, instead of ignoring the problem and trying something new, you need to find out what the problem is. Because, if you can fix it, you’ll double your sales instantly.

What you should do

Before you can solve the problem, you need to know what the problem is.

A sudden drop in sales is usually caused by,

(A) A drop in traffic.

(B) A drop in conversion rate

(C) Occasionally, drop in both traffic and conversion rate.

I’ll ignore C because it’s pretty rare, and because the solution is just a combination of the solutions to A and B.

So, let’s start with step 1: Finding out whether you have a traffic problem or a conversion problem.

Diagnosing a traffic problem

Hopefully, you’re using Google analytics and have it set up properly. (Including goals.)

If not, you’re going to have problems. Maybe you can get the data from web logs, but that would involve a LOT of data crunching just to get “best guess” answers.

OK, let’s assume it’s set up and correct.

Look at visitor levels over a recent period. Is traffic down?

If it is, look at traffic sources and find out WHICH traffic sources are down.

If it’s SEO, have your rankings dropped? If it’s PPC, which metric is down? Impressions? Click rate? Impression share? Average ad position? Is this metric down for all your campaigns/ad groups or just some?

Just asking these questions should, at the very least, help you understand WHY traffic is down. And, instead of a general “My sales are down”, your problem should now be, “This traffic source is providing fewer visitors because…”

But what if your traffic hasn’t decreased? In that case, you’ve got a conversion problem.

Diagnosing a conversion problem

For ecommerce sites – or any site with a checkout – you want to find out whether the problem occurs BEFORE people add to cart, or after.

To do this, you need to know what % of people add to cart. And you need this % from two different time periods.

So, say sales dropped two weeks ago, compare the last 14 days to the previous 14. Is the % up, down, roughly the same?

If it’s down, is it down by a similar % to the decrease in conversion rate?

e.g. If your conversion rate dropped from 3% to 1.5%, and the % of people adding to cart dropped from 6% to 3%, then you know the problem has nothing to do with your checkout process.

On the other hand, if % of people adding to cart only dropped from 6% to 5%, that would only explain 1/3 of the decrease in conversion rate. And the reduction from 6% to 5% might just be seasonal or a statistical fluctuation.

So, chances are, it’s an issue with your checkout process..

If the problem is with the checkout process, have you changed anything? If you haven’t, has the payment processor had technical issues? Or has your site had problems connecting with the processor? (One common problem is expired security certificates.)

If the problem happens before the cart

IMO, this is the hardest problem to diagnose because there are so many possible reasons. At this point, I’d be bombarding you with questions like…

- Have you changed anything on the website?

- No, seriously, have you changed ANYTHING AT ALL on the website?

- Do you have products that were in stock and now out of stock?

- Are your competitors running sales, or cut their prices? (What do you mean you don’t monitor what your competitors are doing?)

- Has your bounce rate increased? If so, for which pages? (BTW, if your bounce rate in analytics is under 10%, your bounce rate is wrong.)

- Which landing pages are seeing a reduction in conversion rate?

- Which pages are showing a decrease in average page value?

These questions may lead you to the answer. Or, maybe you need to keep digging.

Summary

If you follow the above process, you’ll go from asking why your sales are down, to asking a far more specific question.

And, as the saying goes, a problem well-defined is a problem half solved.

But, of course, to do this, you need good data. And, unfortunately, most companies have bad data. Over and over again, when I get a new client, they have errors in their analytics.

So, my advice to you is to check your analytics to make sure that the data is correct and complete. Because you’ll never know when you’ll really need it…

Best wishes,

Steve Gibson

My first ever “SEO is dead” prediction

I’ve been doing PPC management for 11 years (since 2006) without ever claiming “SEO is dead.” So what’s changed?

Last month, I was at Turing Fest and listened to Rand Fishkin and Wil Reynolds talking about voice search.

Rand told the audience,

Voice search that shows text results – great! That’s just more things to SEO and PPC for.

Voice answers? That scares the crap out of me. It should scare the crap out of everybody in here.”

Why should it “scare the crap” out of us?

It comes down to one thing … Continue reading

Posted in SEO

What I learned behind enemy lines

Earlier this month, I was at Turing Fest – a two-day marketing/tech conference in Edinburgh.

Whenever I go – this is my third year in a row – I feel like I’m behind enemy lines. For three reasons…

#1: I’m much older than most of the attendees. That sucks. Get off my lawn.

#2: I work with “real businesses,” while most attendees work for start-ups. You know, the sort of tech company that creates Continue reading

Organic v Paid – why everyone’s asking the wrong question

Perhaps the dumbest question in internet marketing is, “Does anyone click on the Google ads?”

Now, if I were sarcastic, I might answer, “No, that’s why Google doesn’t make any money…”

Seriously, folks, it’s not hard to answer this question. After all, Google’s a publicly traded company, which means they report their profits.

For example, in 2015, Google’s revenue was roughly $75bn. Of that, $52bn came from ads on Google’s own websites.

So, let me ask you, Continue reading

“Have you ever seen a monkey examine a watch?”

I’m going to give you some advice on how to work with marketers.

But, before I get to the advice, I have to set it up with a story.

The story is about Wilhelm Steinitz, the first ever world chess champion, and it goes like this…
Steinitz was playing a game against another top player. After the game, the players went over the game. They discussed different ideas, and alternative moves that weren’t played.

While they were doing this, an unskilled amateur – in chess parlance, a “patzer” – kept interrupting and telling the masters what moves they should have played.

Steinitz, put up with this for as long as he could. But, finally, he snapped. He turned to the patzer and asked, “Sir, have you ever seen a monkey examine a watch?”

OK, what’s my point?

I was recently hired by a company to improve their PPC results. They were paying around £60 per lead, which was roughly breakeven. We set a target to get that down to £45.

So, I reworked their AdWords account and, straight off the bat, we were down to under £45 per lead.

And that was straight away. I knew, with further testing, I could continue to get it lower. For example, I was writing a new landing page for them, which I expected would increase the conversion rate. And a higher conversion rate means a lower cost per lead.

So, things were going well. Or, at least, that’s what I though.

Then their sales manager – who’d never successfully run an AdWords account – decided that he knew better than me.

His idea?

•    To take our most profitable keywords, change them from phrase match to exact match.
•    Change the ads from offering a precise result, to being vague and generic.
•    Run the ads just a few hours a day.

I tried to talk him out of it, by asking him to look at the data, but some people won’t listen. So, reluctantly, I implemented his changes.

The result?

Exactly what you’d expect.

By switching from phrase to exact match, we reduced the number of ad impressions for our best keyword. And, of course, showing them for only part of the day reduced that even further.

And, on top of that, the new ads, as I expect, had a lower click rate.

(Specific promises almost always beat vague promises in advertising. This has been known for around 100 years. For example, Claude Hopkins wrote about it in his book, Scientific Advertising, in 1923.)

The number of conversions shot down, the cost per conversion shot up – to over £100/lead. And the client ended up pausing what had been a profitable account.

What’s the lesson?

Expertise beats a lack of expertise. If someone’s been doing something for 10 years (I’ve been managing PPC accounts since 2006), chances are, they know what they’re doing.

So, if you hire a marketer, and they’re producing good results, let them continue. Because, if you think it’s easy – and that your opinions can outperform their experience – chances are, you’ll shoot yourself in the foot.

Best wishes,

Steve Gibson

P.S.  I just re-took my AdWords exams. You get 2 hours for each one. I rattled through them and scored 94% in 28 mins in the first, and 88% in 26 mins in the other.

So, if you’d like an AdWords manager who knows his stuff, click here.

How to make millions with a terrible business

Imagine you have an unknown product, and your goal is to become the world leader within 4 years….

Even though you don’t have much money …

And your product really isn’t any better than your competitors’ …

And, on top of that, your product is twice as expensive as everyone else’s …

Do you think you could succeed?

The Pepsodent Story

In the early 1900s, the creator of Pepsodent was in exactly this position.

And, when he approached Claude Hopkins – the greatest ad man of the time – Hopkins thought the project was hopeless and turned him down.

However, after much cajoling, Hopkins took on the project – in return for stock options in the company.

And, four years later, Pepsodent was the world’s leading toothpaste. Eventually Hopkins cashed in his stock options for the equivalent of $13.7 million in today’s money.

So how did he do it?

The Success Strategy

The success was based on a simple set of principles…

#1: Research – Hopkins read countless books on dental hygiene, looking for facts he could build his campaign around.

#2: A big idea – The importance of a big idea was best summed up by David Ogilvy:

“You can do homework from now until doomsday, but you will never win fame and fortune unless you also invent big ideas. It takes a big idea to attract the attention of consumers and get them to buy your product. Unless your advertising contains a big idea, it will pass like a ship in the night.”

#3: Marketing knowledge – When advertising toothpaste, it’s tempting to focus on preventing tooth decay. However, Hopkins knew that would fail. He wrote:

“People will do anything to cure a trouble, but little to prevent it. Countless advertising ideas have been wrecked by not understanding that phase of human nature”

Hopkins knew this because he’d worked on hundreds of campaigns and measured the results. And, because he knew this, he was able to avoid a common pitfall.

So, instead of decay, his ads focused on an immediate benefit: removing unattractive film from your teeth.

#4: Testing – Hopkins tested literally hundreds of ads. Some worked, some failed. He later wrote:

“One series of ads which I prepared would have wrecked it in three months. Yet I had at that time spent nearly thirty years in advertising. I had learned from hundreds of campaigns.

What is the lesson? That none of us can afford to rely on judgement or experience. We must feel our way. New problems require new experience. We must test our undertakings in the most exact way possible. Learn our mistakes and correct them.”

If he’d just written an ad – and used only that ad, the campaign could have failed. Or it might have succeeded, but only on a small scale.

By giving himself hundreds of chances of winning – instead of just one – Hopkins swung the odds heavily in his favour.

So, rather than going with the first ad he wrote, he could use the ad that was the best out of hundreds.

No wonder they succeeded.

Summary

Hopkins referred to this approach as, “playing on the safe side of a hundred to one shot.” You could call that the casino strategy: Stack the odds in your favour and stay in the game long enough, you’re almost guaranteed to win.

In my opinion, almost any business would do better if they used this strategy. I don’t guarantee world domination, but I’m sure you wouldn’t be too unhappy if all it did was double or triple your sales.

Best wishes,

Steve Gibson

What I’ve learned from 10 years in PPC

When I was first introduced to AdWords in the summer of 2006, I was hooked instantly.

That’s because I knew about direct marketing and realised that AdWords was nothing more than a delivery mechanism for a direct marketing message.

Not only that, but unlike most forms of direct marketing, PPC was quicker,  simpler, more flexible, cheaper, and easier to measure.

What used to take months could now take days. You could write a new ad today, test it against your existing ad, and within a few days, have a clear idea of whether the new ad was better, or worse.

And that meant you could improve your ROI rapidly – and for almost zero cost.

Here we are 10 years later, and I decided to mark this anniversary by sharing 10 of the biggest lessons I’ve learned about AdWords.

Let’s start with that first lesson: Continue reading

Posted in PPC

Why the secret to PPC success isn’t PPC

Let me let you into a secret: You could have the hottest hotshot pay per click manager in the world… and still not be able to compete in your market at PPC.

By “compete”, I mean be one of the top 2-3 advertisers that hoover up the vast majority of clicks.

Why not?

The reason… as the headline suggests… is that the true secret to PPC success has little to do with PPC. Continue reading

Posted in PPC

Why SMBs Should Use AdWords

Last week, Matt Umbro wrote a post called, “Why SMBs Should Not Run AdWords Accounts”.

Before I give my response (Spoiler! I don’t agree), we have to define what an SMB is. Matt’s definition is a business that spends less than $500 a month on clicks. So let’s use that.

Now that’s out the way, here are the points I want to make:

#1: Spend is the wrong way to measure the size of an account

Which account is “bigger”,

(A) One that spends $1,000 a month and brings in net sales of $2,000 – profit $1,000

(B) One that spends $300 a month and generates net sales of $3,000 – profit $2,700.

I would suggest the latter. And, BTW, that’s not a crazy example, I’ve had clients who got that sort of ROI. (I’ll explain more later in this post.)

So my view is that, when judging the size of account, you look at the value of the traffic, not the cost of the traffic.

#2: The cost of AdWords management should be compared to net sales, not click cost

Matt gave an example of a PPC account that spent $500 on clicks, and $225 on management. That would mean that, of the $725 spend, 31% goes on management.

As Matt pointed out, by that measure, it’s hard to justify paying for PPC management.

But, looking at it another way … if the $500 brings back $2,000, the cost of management is only 11.25%. A totally different story.

#3: Why are they only spending $500?

There are four main reasons why a business may be using AdWords but spending less than $500/month.

One reason is that they’re testing AdWords, with the plan of rolling it out if it’s profitable. But I’m going to ignore those businesses because they won’t be spending $500/month for long.

A second reason is that they’re a local business where there simply isn’t much in the way of search volume.

A third group is niche national businesses. Again their products or services are so niche, there’s little in the way of search volume.

And the fourth is businesses who, because they earn so little from a visitor, can’t bid competitively. Their spend is limited because their ads rarely show, and when they show, they’re low down on the page.

For this fourth group, the answer is simple: they need a better strategy.

(I outlined what I believe to be the correct strategy in my book, “How to dominate your market with search engine marketing.” You can download a copy here: http://www.bothsidesoftheclick.co.uk/dominate)

For the local and niche businesses, margins tend to be high, and competition tends to be weak, so it doesn’t take a lot of expertise to manage it yourself.

Which takes me to the next point…

#4: AdWords is easy

Matt wrote, “AdWords is difficult”. I’m going the opposite way.

Although I agree with him that PPC has become increasingly complex, I still think it’s the easiest form of direct marketing.

You can read an introductory book in an afternoon and know 80% of what matters.

Try doing that with direct mail, or newspaper/magazine advertising.

And don’t get me started on SEO …

#5: Do you even need PPC management?

If your business is spending less than $500 a month, do you really need much on-going management?

As I just said, you can learn 80% of AdWords in an afternoon. That’ll put you ahead of most of your competitors.

So you might hire someone to set up your campaigns, or to optimise them, but by-and-large you can “set it and forget it”.

#6: Is Facebook a substitute for AdWords?

Matt recommended Facebook ads as an alternative because they “require less time and effort while being more cost effective.”

Again, I don’t agree with this. For three reasons …

First: it’s a totally different beast. As I wrote in an article a couple of years ago,

“Imagine this was 1995, how would you sell your product/service?

If you’d sell via shops or the yellow pages, then AdWords is probably the best fit.

On the other hand, if you would have used direct mail and/or telemarketing, Facebook probably suits you.”

Or, to put it another way: if Facebook doesn’t suit your business, it doesn’t suit your business. And, on the flipside, if AdWords doesn’t suit your business, you shouldn’t be using it.

Second: AdWords is a moving parade of prospects. The people searching on a keyword this month aren’t the people who searched last month. So, in uncompetitive markets, you can have the same ad running for a year, without seeing a drop off in click rate.

That’s not the case with Facebook advertising.

That’s because Facebook is demographic targeting, it’s the same people seeing your ad over and over. And that means your ads – and your offers – will fatigue quickly.

And when your ads fatigue, you click rate plunges and Facebook stops showing your ads.

So, in order to keep the enquiries rolling in, you’re going to have to keep coming up with new ads and new offers.

That might not be a problem for some businesses. But it’ll be a problem for most businesses. And, either way, it’s work. And that work is a cost.

Third: while clicks can be a lot cheaper, conversion rates are usually much lower. That’s because, unlike someone searching on Google, Facebook user isn’t actively looking for what you sell.

#7: What disadvantage?

Matt wrote, “Small businesses are still at a severe disadvantage when trying to run AdWords accounts.”

My question would be, “A disadvantage to whom?”

Small businesses tend to compete against other small businesses, not big companies with large ad spend. And all they have to do is be better than those small businesses.

It’s like the old joke:

Two men are walking through a forest. Suddenly they see a bear walking towards them. One of the men takes running shoes from his bag, and starts putting them on.

“What are you doing,” asks his friend, “Those shoes won’t help you outrun a bear.”

“I don’t have to run faster than the bear,” says the first guy, “I just have to run faster than you.”

Summary

Small businesses need to get traffic from somewhere. And, although AdWords is increasingly complex it’s still easy compared to the other options.

Not only that, but it brings in highly-targeted, ready-to-buy traffic that’s easy to convert.

So I still believe that SMBs should seriously consider using AdWords.

Best wishes,

Steve Gibson

Posted in PPC