While I have worked with small business owners for more than 12 years in my career and have helped them solve multiple problems through various problems and solutions, one of the constant problems I hear from business owners is that they are always struggling to grow their business.
Getting new customers, marketing their business is the key area of focus for business owners, but the irony is that most of them do not fully understand the power of modern tools and products available to them.
One such powerful tool is google ads or previously known as ‘google adwords’ that small business owners have at their disposal. This is an essential component of any digital marketing plan for small businesses.
As a general rule, small businesses should use the google ads platform intelligently to identify target audiences that work well for their business using low budget experiments.
Folks who are digital marketing specialists, use google ads as one of the key tools for advertising in parallel with search engine optimisation (SEO) which then works wonders for the business with respect to improving awareness and reach.
What does google ads mean for small businesses?
Having gone through google’s documentation for their ads program, i found a few points that will be useful for small business owners
Google Ads is Google’s online advertising program. Using Google Ads, a small business can create online ads to reach potential customers at a time when they’re interested in the products and services that your business offers.
Basically, google’s algorithm uses web data to figure out a potential customer’s behaviour and as and when the user inputs a phrase that is related to your business in the search engine, the google ads platform will serve your business as the first choice for the customer if you own the key word for that time period.
Some important things that small business should know about google ads is that
- Google Ads is a product that you can use to promote your business, it helps increase traffic to your website through advertising which enables you to sell better, it amplifies the benefits of good search engine optimisation
- Google Ads accounts are managed online, which gives you complete flexibility to change and adapt the campaign to suit your situation
- As a business, you wont face any minimum spending commitment, you can choose how much you want to spend on advertising, it can be even as low as $1 theoretically.
One of the key concepts behind how google ads work is a concept called pay-per-click or ppc which we will go deeper in the next section.
What is the concept of Pay-per-click (PPC) advertising in google ads?
Pay-per-click (PPC) is a digital advertising model used to drive traffic to websites which has been mastered by google through their algorithms. This is a concept in which an advertiser (small business) pays a publisher (google) each time an ad that is displayed is clicked.
If you as a small business sign up for a google ad, your payment happens only when someone clicks on the ad placed by google in the search engine results page. You will not pay anything if your ad is only displayed and no once clicks on it.
Here’s a breakdown of the concept and its elements for a greater understanding
Bidding and Placement
Advertisers bid on keyword phrases relevant to their target market. In Google Ads, these ads appear in search engine results or on websites that are part of their advertising network (websites that sign up for adsense, which is a google display ad service). The placement of an ad depends on the bid amount and the ad’s Quality Score (a measure of the relevance and quality of the ad).
Costs of PPC advertising
The cost per click (CPC) can fluctuate a lot depending on the competitiveness of the keyword. Some keywords may cost only a few cents per click, while others can cost much more. For example, if you type in the term “loans for small businesses”, you will see a ton of sponsored results, the cost per click for this phrase will be extremely high since the competition from large players is extremely high.
The trick here is to look for keywords related to your business, where you don’t see any ‘sponsored’ results on the google search results page and place a bid for those which are highly likely of being fairly cheap.
Targeting the right audience through PPC advertising
PPC features allow a small business to do detailed targeting, including demographics, location, language, and even the time of day. This ensures that the ad is seen by a specific segment of the audience, increasing the likelihood of relevance and engagement. Once a small business nails this part, they will habe useful signals to optimise their SEO. SEO should be a major strategy of any digital marketing plan for a small business.
Flexibility of PPC campaigns
PPC campaigns can be quickly modified, paused, or stopped, offering flexibility to advertisers. This is particularly useful for testing different keywords, ad copy, or targeting strategies.
Utility of PPC for local businesses
PPC is a popular strategy for businesses of all sizes. It’s especially beneficial for local businesses looking to attract an audience that is geographically close by, as well as for online businesses looking to drive web traffic and sales.
Overall, PPC is a fundamental component of digital marketing strategies, allowing businesses to reach potential customers actively searching for related products or services.
How should small businesses plan a PPC campaign in google ads?
Most small businesses typically end up competing with larger companies in the paid advertising space. In traditional mode of advertising, its very difficult to out compete larger players especially when the access to resources is vastly different.
However, small businesses or startups can stand a great chance to win against established companies in using google ads and ppc in general by using some strategies that will give them an edge. The key is to look at what users search for and then using paid advertising in your marketing campaigns to target pain points.
Some basic elements of a ppc campaign that small businesses must have in place are
- Understand Your Audience – Identify who your target customers are and figure out what they search for. Use this understanding to define the boundaries of your campaign to make sure that google targets the audience you want.
- Keyword Research – Small businesses should focus on developing a robust keyword strategy as a core component of their ‘search campaign’ for the right phrases. Go for something is in the ‘negative’ or ‘inverse’ of the highly competitive keyword.
- Set a Budget – Decide on a budget for your campaign, this budget should be something that you are ok to not get any returns on. PPC allows for flexibility, so you can adjust your spending based on the performance of your ads.
- Choose the right bidding strategy in the beginning – You want to start with a manual bidding strategy to set a maximum price you are willing to pay per click for a keyword to see the results
Start your google ads journey with the above journey and you will being to see results slowly starting to come through. More than anything, you will end up learning a lot of what works and what does not work for your business and it will help you later on once you decide to spend a lot more money.
How do you run a google ad for your small business?
There is a detailed ‘how to set up google ads account’ that you can find on the link support.google.com/google-ads
That covers the execution aspect of how you can create an account, set up the various details etc.
What I will cover in this section is more of the thinking and strategy that goes into running a good ad campaign on google ads as a first time user, which many small business owners are. I want to give you a mental model that you can use while planning advertising through google ads.
There are two areas that you may want to start if this is the first time you are starting off. There are a lot of other advertising options available on the google ad network, but these two are the most common sensical to start off with as a small business owner.
- Google search if your audience is spread across geographies
- Local advertising if you are a local business
You will learn a lot from running your campaigns on these two before you experiment with other types of campaigns that you can run.
Lets look at both in a bit more detail
Advertising on google search
If your small business offers digital products or services where location is not a constraint for your target audience, this is the best starting point for you. Starting off with search advertising can keep your costs low, can be very targeted and will give you a more relevant audience than say a video ad or any other ad that does not have an obvious way to target your audience.
The most important aspect of a search google ad is how you select the keywords to place a bid on. A not-so-obvious way to start thinking about this is to put yourself in the position of a target customer who is potentially searching for solution to a problem.
You will have multiple competitors competing for the keywords that address both the “problem” and the “solution”. Pick a nuance that most products don’t solve for, but your product solves and try bidding for keywords on that nuance. You are much more likely to land keywords that are way cheaper and more relevant to your offering.
Advertising for a local audience
Is your small business providing products or services that are extremely local in nature? Are your target customers in the same city or the same county? If then, a good starting point for you is to look at the local campaign that google has.
Google will advertise your business as a store across multiple channels including google maps, youtube, local google search and gmail. There is a great video tutorial provided by google on how you can set this up. You can search for “setting up google ads campaign” on youtube.
What is the right ads budget for a local campaign for a small business in google ads?
Once a small business owner finds the right way to run advertisements on google, the next question that naturally comes up is what is the right amount they should spend on such ad campaigns. There is no definitive correct answer.
It largely depends on your objective, if your experimenting, the budget can be as low as $10 (or lower) and if you want a sudden surge of traffic, there is no real upper limit.
How much does the average small business spend on google ads?
On average, its common for small businesses to spend anywhere between $1,000 to $10,000 on google ads per month. This number is usually dependent on the revenue that the small business generates and the amount of resources the business owner has access to.
That said, the best way to get the answer for yourself is to look at the outcome you are expecting from the ad campaign. If the outcome justifies the expense you have in mind, go for it. Else, experiment with small budgets and learn what works and what does not.
As a small business owner, you are uniquely positioned to take advantage of the ‘time to experiment’ you have on your hand. You are competing with agencies and larger companies who are governed by so many KPIs that are not relevant for you. Agencies and larger companies are always working against the clock to get a good outcome in the shortest possible time frame and because of that, they underperform in the long run.
Take advantage of that as a small business, look at all possible combinations of ads that work for you with tiny budgets and build organic marketing channels to mimic that which can work wonders for you for free.
What are the Google ads costs for a small business?
Every industry has a separate cost for google ads depending on the value of services provided in the industry and how much each advertiser can pay. Wordstream did a survey recently that came up with some findings for the average cost per click, which i have taken from their website.
The following table outlines for you the average cost per click for each industry sector based on their survey. This however can change based on the season, the amount of competition and new entrants who can skew prices temporarily.
Do google ads work on a small budget?
Working with a small budget is the greatest advantage that small business can get. Use your budget to experiment for short periods of time. Run ad campaigns for a couple of days to get at-least 50 data points for each campaign.
That will be statistically significant enough for you as a business owner to understand what works. Once you figure out what works, I would strongly urge you to build an organic acquisition engine.
For example, if you spend $10 over two days to find out, which keywords work well for your business, once you find that out, use that learning to build out a great content strategy that doubles down on the keyword which gave you good results.
This way, you will build a moat for yourself which will give you free traffic over time that becomes free leads for your business with time.
How can a small business use Google Ads campaign data with Google Analytics based on its business profile?
Google offers some excellent tools that help small business owners understand how their campaigns work. Google analytics is the go-to tool that you should rely on to look at all campaign data. The first step for a small business owner is to link their google ad account with google analytics. Its fairly easy and there are videos from google that show how to do it.
There a few critical steps that business owners must then do to get the most out of their data in google analytics.
- Set goals – these are benchmarks that they want to measure against, keep it realistic, you cannot expect a 10% conversion on your first try
- Set up auto-tagging in all google ad URLs – this starts collecting all data automatically for you to review
- Use Audience insights from google analytics to check if you are targeting the right audience in your campaign
- Look at conversions – this will give you an idea of the campaigns that actually convert and those that dont – this is where you learn what works and what does not
- Look at user behaviour journeys – this will show you how users interacted with various web pages, where did they drop off etc. to give you what interests your audience and what does not
These are some of the steps that every business owner must take to understand their analytics data for their ad campaigns.
Are google ads worth it for a small business?
When small businesses approach google ads with a sense of experimentation and to learn more about their target customers, google ads can be a quick and cheap way to generate insights. However, when looked at from building awareness, generating leads, with limited resources, small businesses should stay away.
Consistent spending on google ads is best left to larger companies that have dedicated digital marketing budget to spend on google ads and all ad channels available
What are the best google ads for a small business?
To Summarise, lets look at the best type of google ads for small businesses since they are easy to understand and also give predictable results when compared to some of the newer types of ads in newer channels
- Search Ads
- Local services or Store ads
Use these channels to test and prove out your hypothesis before looking at newer ways of advertising.
Are there free google ads for small businesses?
Regular for-profit small businesses cannot get any free ads from google, unless they sign up for any other service provider as a part of a greater deal, they can have access to limited time free ads credits.
As a formal program, google does offer free ads to non-profits as a part of their ad-grants program, though it is offered only to qualifying non-profits. Each qualifying non-profit can be eligible for up to $10,000 per month in terms of worth of ads to get discovered online. If the selected non-profits want to advertise for more than $10,000; they need to buy additional like any other regular business.