The Goal of running Online Advertising (as with Offline Advertising) is to bring in revenue to your business. One difference between Online Advertising (in this case Google AdWords) and Offline Advertising is TRACKABILITY. Google AdWords offers an excellent amount of transparency into the result driven world of advertising. Utilizing tools within your AdWords account like Google Analytics and Google Conversions Tracking you can begin to get a better picture of the Return you can on your Investment (Return on Investment ROI).
Your ROI is calculated as follows:
(Revenue – Cost) / Cost
When running campaigns it is very important to keep a close eye on your ROI and make sure that your efforts are as efficient as possible so you get the biggest bang for your buck.
Some strategies you can utilize when advertising to help assure a positive ROI are:
Splitting your efforts into specific product or service groupings
Separating those groupings into more specific sections based on geo location or product/service sub groups
Spend more on the items that you have a higher profit margin on
Proper Account Structure is very important