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PPC budget strategy: Tips for success on a limited budget

You don’t need a large budget for an effective PPC strategy. Here’s how to maximize the success of your PPC campaigns regardless of the size of your budget.

The budget of a PPC campaign can play an important role in its performance. However, it doesn’t guarantee successful results without a proper planning first.

It’s common to believe that the bigger the budget for your PPC campaign, the better the results. But small businesses, or those without a lot of resource to allocate to PPC, may not always have the option of increasing budget. So how can you be as successful as possible with what you have?

This article will set out how you can manage your PPC strategy in a way that maximizes the benefits of your budget, no matter what its size.

Set clear goals for your campaign

Forward planning is critical when getting started with PPC. Having a pre-defined outcome for your paid search campaign will help you to avoid over-spending and incurring unexpected extra costs, so the first step is to set your goals.

Decide on what you’d like to achieve with your campaigns and how you’re going to achieve it.

Estimate your budget

Once you’ve set your goals, it’s time to decide on the initial budget that you’d like to use for your campaigns. 

The first question is to decide on the number of leads that you’d like to gain through PPC. The answer should be aligned with your available resources and the goals you set in the last step.

The next step is to make sure that you’ve clearly defined what counts as a lead for your business before you start calculating the CPA (cost-per-action) to expect.

Wordstream has presented this process in a graphic that explains how your expectations for the number of leads and the conversions can help you determine your PPC budget.

For example, if your client goal is to gain 250 new ones per month and your current close rate is 15% with a cost of $25/lead, you will need a budget of $41,666 per month to generate 1,667 PPC leads.

In this case, a quick solution is to use your budget in campaigns that involve lower CPA to increase your chances of higher success.

Be strategic with the allocation of your budget

The next step is to aim for an improved CPA. A cost-efficient CPA helps you become more strategic with your PPC campaigns, and allows you to determine the most effective ads to apply your budget to.

If you want to lower the CPA, then you need to:

  • Increase your conversion rate (CVR), and
  • Decrease your cost per click (CPC).

By focusing on the best performing ads and lowering your CPA, you can spend your budget more wisely.

As always when calculating ROI, the higher the revenue when compared with expenditure, the better the investment.

You might now be wondering what steps you can take to increase your CVR, or decrease your CPC. If so, read on for some tips on how to do exactly that.

Perform keyword research

Carrying out in-depth keyword research should help you spot the best opportunities to reach your audience. 

A keyword list has to be thorough, relevant and dynamic. You want your list to include the most popular keywords that resonate with your target audience, but also long tail keywords that offer a great opportunity for more specific targeting.

To calculate the effectiveness of your keyword bidding strategy, you can follow this formula:

Keyword searches x CTR = Estimated traffic

For example, 1,500 monthly searches x 4% click-through rate = 60 visits per month.

This way you can analyze both the search volume, but also the cost per click to decide if it brings you closer to your goals.

A good tip to maximize the effectiveness of your campaigns with a limited budget is to continually review the performance of your keywords.

By analyzing your keywords during the campaign, you can determine whether or not they’re effective – and if not, you can re-allocate your budget to avoid wasting resources on keywords that don’t work.

Focus on targeting

Taking a closer look at campaign targeting can save you money while improving the relevance of your ads for your audience.

If your campaign is only interested in driving leads from one specific location, for example, you can geo-target your PPC campaign to avoid wasting spend on targeting a global audience.

Geo-targeting increases the chances of success for your campaign if you want to focus on local marketing to drive conversions.

Moreover, keyword targeting should help you pay for the ads that work better for your business. There’s no need to pay for broad match keywords or competitor keywords that only waste your budget. By adding them as negative keywords, you can focus on the most effective ones to increase the conversions.

Improve your Quality Score

Your AdWords Quality Score affects both your cost per click, but also the conversions. Google considers the Quality Score of significant importance, and your CPA depends on it.

If you are aiming for a lower cost per action, then you need to ensure that you improve your Quality Score.

The best ways to do so are to:

  • Create relevant ads for your target audience
  • Focus on the right keywords
  • Keep your ad groups organised and structured
  • Refine your landing pages to be helpful and relevant to each ad
  • Focus on ad copy to improve your CTR
  • Build your AdWords account performance to improve your reputation

The good thing about the Quality Score is that once you start building your reputation, you’ll be able to save money on keyword bids. This way, you can rank higher without necessarily spending more than your competitors.

It’s also useful to revisit your ad groups from time to time to keep the ones that work better. Focus on the most successful ad sets and stop investing your budget in the ones with low conversions.


It’s not the budget that determines the success of your campaign, but your strategy. Your PPC budget strategy is all about focusing on the best-performing ads while constantly reviewing performance to make sure you are allocating resources in the most effective ways.

If you feel limited by your budget, it’s useful to start small and expand your reach once you’ve learned which strategies work best for your business.

A good understanding of the target audience, relevant keywords and a structured PPC strategy can help you maximize the potential of your campaign even on a small budget.

by Tereza Litsa
source: Search Engine Watch