Posts Tagged ‘recession’

PPC Marketing In A Recession

Sunday, December 28th, 2008

Although we are not technically in a recession, 2008 has been a hard year for businesses and has seen the collapse of companies of all sizes. By all accounts, this trend will continue for at least the next six months. Many companies have had to reduce overheads and make cutbacks wherever possible in order to survive, and the marketing budget is often one of the first things to suffer.

PPC campaigns should be regularly reviewed over this tough period to ensure they maintain a good ROI. However, I feel that in most cases, reducing the PPC advertising budget is a mistake for many companies. A company’s advertising budget is often divided into different sectors, including PPC advertising; TV advertising; Magazine ads etc. Each medium has its strengths and weaknesses but PPC ads have two major strengths that are particularly important in such a volatile market.

Firstly, PPC ads give a very fast return on the initial Investment. The time between an ad click and profiting from the sale is often a matter of minutes. A TV campaign, however, can take months to set up and the entire cost of the campaign is paid for upfront. This gives PPC campaigns a huge advantage over other mediums if cash flow is an issue.

The second benefit is that conversion tracking used for PPC ads gives a clear indication of exactly how profitable the campaign is. By contrast, other methods require some degree of faith. It is often not until they have run their course that you discover if they have been worthwhile. Furthermore, If your PPC campaign becomes unprofitable, you can pause it at the drop of a hat.

Of course, there is more to marketing than generating sales in the short term. For example, many campaigns focus on brand awareness and CPM PPC campaigns often fall into this category. For many companies, these long term advertising strategies are the ones that are most expendable in the short term. However, in the current economic environment, many companies will shift their focus to maximising profit margins with as little risk as possible and for this, CPC PPC campaigns will often be the best choice.