Why Google AdWords is Growing, and Traditional Media is Declining

Google Adwords is responsible. There is a simple answer to explain the rapid decline in advertising expenditure using traditional media like newspapers, magazines, TV and radio.

1.    Google AdWords allows the results of an advertising campaign to be measured the day after it is implemented.

2.    The cost of a Google Adwords campaign does not include production or printing costs.

3.    An Adwords campaign can be started and stopped at will or changed easily.

4.    An advertising budget can be a small or as large as necessary. This budget can be highly targeted by region and or language

5.    The objective of a campaign can be tailored exactly to individual products or services at any level… eg every product in a range of thousands, or product categories or if preferred pure branding opportunities.

Traditional media is expensive at the point of entry and disbars many smaller businesses and despite the expense the results are almost impossible to measure in most cases.

What Does it Cost?

Consider the cost of a full page colour ad in a gardening magazine for example… a market in which I participate.

Cost of the colour ad excluding production cost is about R17,000. The return on this adspend is unable to be quantified.

For R17,000 a well run Google Adwords campaign will generate generate about 34,000 clicks to the landing page of a website. It can be reasonably assumed that at least 1% of these visitors will buy. That means the ad campaign generated 340 sales… no argument. If the sales have a profit margin of say R100 then the campaign profit is R17,000 or 100% on the adspend. If the conversion increases to 3% then profit jumps to R85,000 or 500% return on adspend (ROI).

If the profit margin is R200 then the ROI increases enormously.

Google Adwords provides these fundamental basic metrics as often as you like, There is no more guessing involved.

It should be obvious from this basic example that any organisation with an advertising budget should be diverting at least part of that spend to Google Adwords.

There has never been an advertising medium like Google Adwords and this system has revolutionised advertising. Adwords is threatening a complete and traditional high value international business model. And Adwords is winning the battle.

Uptake of Adwords is Slow in South Africa

Despite the massive advantages of Google Adwords relatively few businesses in South Africa are embracing it. This is probably due to ignorance in the sense that managers are not aware of the system let alone the benefits to be had. It is also probably true that of the existing base of users in South Africa only a small percentage are using Adwords to anything like its full potential. The reason for this is that while Adwords is extremely simple in concept it is amazingly complex in practice.

Like any complex system there is lots to learn and action needs to be taken based upon a through understanding of systems and methodologies involved. It is not a task to be delegated to an IT department or a traditional web designer

The difference between a conventional Adwords campaign and an optimised one is enormous in terms of savings and sales. In other words optimizing an Adwords campaign provides a double whammy with a positive impact upon the bottom line of an organisation.

If you’re competing in any type of commercial environment you have to be at least experimenting with Adwords. It’s far too important to ignore. Your competitors might just be miles ahead of you.

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