Do You Pay-Per-Click?
March 26, 2016
Pay-per-click (PPC) marketing works. With the right ads, landing pages, and targeted message, PPC delivers leads to attorneys. But is it always the right choice?
When a law firm is weighing the benefits of PPC marketing against search engine optimization (SEO), they should consider the pros and cons of both.
PPC marketing works during a finite amount of time. Most campaigns have a daily click budget. When that budget is reached, the ads will not show until the next day. With SEO, the listings, news releases, blog content, and social activity is always available.
PPC delivers immediate results. It usually takes 30 days for a PPC campaign to begin generating solid leads. After two months, the ad language, landing page content, and display times can be fine tuned for efficiency. That means a PPC campaign could start on Monday and deliver leads before Friday. SEO is a progressive process, which means it can take from several months to a year for a website to rank high for competitive keyphrases. News releases and social activity (both strong elements of SEO) will deliver traffic immediately; but conversion of that traffic to leads is usually lower than PPC.
PPC can reach non-search networks. This is a big plus for PPC marketing. With SEO, the primary goal is search engine placement. PPC can deliver traffic from other websites, online communities, and even delivers targeted leads based on user content from social network advertising platforms such as Facebook and LinkedIn. This could open a law firm to a wide audience of prospective clients which would not be reached by high search engine placement.
PPC is expensive. Cost is probably the biggest downside to PPC marketing. Most PPC platforms are based on a system where the highest bidder gets the highest placement. Google Adwords looks at the quality of ads, landing pages, and conversion rates, making it possible to get higher paid placement at a slightly reduced rate, if they deem those elements of a campaign as being “high quality,” but for the most part, it’s more about being the highest bidder than focusing on improving conversion rates.
Establish a Budget
Heavily competitive practice areas like personal injury, criminal defense, and bankruptcy are going to require some of the highest click charges. For personal injury keywords, Google Adwords charges as much as $60 per click in some cities. With a two percent conversion rate, that comes out to a cost of $300 per lead. If 25 percent of those leads are viable cases, each new case costs $1,200. Of course, a firm can focus on long-tail keyphrases. For personal injury, long-tail keyphrases could be “commercial truck accident injury” or “I was hit on my motorcycle.” Those keyphrases cost a fraction of the most competitive keyphrase like “car accident” or “personal injury lawyer,” and they usually have a high conversion rate.
When planning a PPC budget, base assumptions on a very low conversion rate - like one percent. If the average cost-per-click for a city and keyphrases related to a practice area is $10 per click, a one percent conversion rate would mean that one lead would be generated per 10 clicks, meaning one lead costs $100. If a daily budget was established of $100, based on an average $10-per-click, an average of one lead per day should be generated. That campaign could run seven days a week, which comes out to $3,000 per month in click charges, or it could only run during business hours five days a week, which would cost about $2,000 per month.
Always allow 10-15 percent for click overages. If a daily budget is $100, a campaign during a day has deliver $95 in clicks; Google Adwords will not disable the ad until $100 is reached. If the next click costs $10, the click charges for that day will be $105, even though the daily max was $100. This happens because the average click charge was $10. That means some ads cost $1 per click, others cost $20 per click.
Next, diversify the PPC budget. The above budget was based on search traffic alone. But there are ads on websites (Display Network), and Facebook Ads. To get started, allocate about 25 percent of your search budget to display ads (PPC ads that display on relevant websites), and as social network ads like Facebook.
If the above campaign is running seven days a week for search ads ($3,000 per month), display and social ads cost $750 per month (25 percent of the search budget), and we allow 15 percent for click overages, the total monthly click charges budgeted should be $4,312.50.
Don’t put away the calculator just yet. Someone has to manage these campaigns. The initial setup of a PPC campaign requires the creation of dozens of ads, keyword research, and creating dozens of landing pages that correspond with the ad language. Most PPC management firms charge a one time setup fee of $500 - $2,000, depending on what they’re including.
Monthly management costs vary. Most companies will charge a percentage of your click charges, say 10-20 percent. Others will charge of flat rate of $500 - $1000 per month. If a large campaign is spending over $150,000 per year in click charges, the fee will be substantially higher. In that scenario, hundreds of ads are being monitored and managed on a regular basis. For a campaign the size of our example, we will go with a management fee of 15 percent, or about $650/month.
The grand total for the PPC campaign, when including click charges, click overages, paid search ads, paid display ads, paid social ads, and management fees is $4,962.50 per month.
With the proper management, PPC is an investment that can pay off. For law firms that have more patience and smaller budgets, SEO marketing is the better choice.