How good is your PPC Agency? Tips and Best Practices

WhenChoosing the right pay-per-click (PPC) agency can significantly impact your marketing strategy. With numerous agencies claiming to be experts, assessing whether your PPC agency is truly effective is crucial. But how and where do you start on how to evaluate that? Here’s how to evaluate your PPC agency:

1. Evaluate Performance Metrics

Reviewing performance metrics is the most direct way to gauge your PPC agency’s effectiveness. Minimum key performance indicators (KPIs) should include:

1. Click-Through Rate (CTR): A higher CTR suggests that your ads are relevant and engaging to your audience.
2. Conversion Rate: This measures the percentage of clicks that lead to desired actions (e.g., purchases, form fills. etc). A strong conversion rate indicates effective targeting and a compelling ad.
3. Cost Per Acquisition (CPA): This metric shows how much you spend to acquire a customer. Lower CPA means your agency is efficiently using your budget.

Tip: Ensure your agency provides regular and transparent reports on these metrics.

Other metrics to monitor could include:

1. Payback period: How long it takes for your org to recoup its investment in a marketing campaign
2. Average revenue per user (ARPU): Is used primarily in subscription-based businesses, telecommunications, and SaaS (Software as a Service) companies to measure the average revenue generated from each user or customer over a specific period.
3. Customer lifetime value to customer acquisition cost (CLV: CAC): Used to evaluate the efficiency and profitability of acquiring new customers. It compares the value a customer brings to a business over their lifetime (CLV) to the cost of acquiring that customer (CAC).
4. Cost per lead (CPL) Measures the cost of acquiring a new lead. A lead is a potential customer who has shown interest in a product or service, often by providing contact information or engaging with a marketing campaign.

2. Review Ad Quality and Relevance

Examine the quality and relevance of the ads your agency is running. Compelling ads should:

1. Align with Your Brand: Ads should reflect your brand’s voice, messaging, and style.
2. Precise Targeting: Ads must reach your intended audience with relevant content. Try to avoid targeting a broad audience (e.g., all industries, all titles, all company sizes)
3. Strong Calls to Action: Compelling CTAs encourage users to take the desired action. (e.g., Sign up now, get the guide, watch today)

Tip: Your agency should regularly optimize ad copy and design to keep them fresh and effective. Avoid “Set it and forget” methods, as they are lazy.

3. Check Budget Management

An efficient PPC agency should manage your budget efficiently. Check if they:

1. Please stick to the Budget: Ensure they’re not overspending or underspending on campaigns. Are they providing recommendations on benchmark budgets to start with? If not, they should.
2. Optimize Spend: They should allocate your budget to the most effective campaigns and keywords. If one campaign performs much better than another, re-allocate more to another to keep in line with the budget.
3. Provide Value: Assess if you’re getting a good return on investment (ROI) for your spending. (See performance metrics above).

Tip: Monitor specific cost metrics, such as cost per lead and cost per click, to optimize budgets.

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4. Agree on a Strategic Approach

A competent PPC agency should have a clear strategy in place. Look for signs of:

1. Goal Alignment: They should understand and align with your business goals and objectives.
2. Keyword Strategy: Effective keyword research and selection should be part of their approach.
3. Competitor Analysis: A good agency will analyze competitors to identify opportunities and threats.

Tip: Their strategy should be adaptable and respond to performance data and market changes. They should also have a reasonable number of goals—anything more than 10, for example, is going to be messy and confusing in terms of direction.

5. Evaluate Communication and Reporting

Effective communication is key to a successful partnership. When evaluating a PPC agency, they should:

1. Provide Consistent Updates: Expect consistent communication and detailed reports on campaign performance. We have a weekly meeting scheduled to constantly review metrics and next steps.
2. Be Responsive: They should address your questions and concerns promptly. Check to ensure they provide SLAs on turnaround times.
3. Offer Insights and Recommendations proactively: Reports should include actionable insights and suggestions for improvement.

Tip: If your PPC agency is ONLY reactive, it’s time to look for another partner.

6. Look into Case Studies and Testimonials

Researching the agency’s past work can provide valuable insights. Check for:

1. Case Studies: Review examples of past successes and how they achieved results. What industries and/or sizes are most of their clients from? This could provide insights into their “sweet spot.”
2. Client Testimonials: Positive feedback from other clients can indicate reliability and effectiveness.

Tip: Are you really indecisive about which agency to choose? You could try asking past clients for feedback before making your decision.

7. Assess Industry Knowledge and Expertise

Lastly, ensure that the agency demonstrates strong industry knowledge and expertise. They should:

1. Stay Updated: Be aware of the latest PPC trends and best practices.
2. Certifications and Training: Look for certifications from platforms like Google Ads or Bing Ads as a strong sign of validation and trust.

Tip: Their expertise should be evident in their work quality and strategic recommendations.

Conclusion

Evaluating your PPC agency involves not only looking at performance metrics, ad quality, and budget management – but also their approach, communication SLAs, and industry expertise. In doing so, you can ensure that your agency effectively manages your PPC campaigns and drives the desired results.