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Why is Your Average Cost Per Click So High and How Can You Fix It?

When it comes to cost per click, the main concern most business owners have is cost, and considering how fast costs can skyrocket, this is a valid concern.  Naturally, you have to balance what you spend against returns, as with any marketing or SEO effort, but when you don’t know what the return will be, this can be understandably difficult.

Over time, you’ll learn to spot trends, and working with an experienced and successful digital marketing agency can certainly help, but when you start to notice that cost per click is much higher than normal, on average, you should definitely investigate.  Why does this happen and what can you do to rectify the situation?  Here are a few things you should know.

Increased Competition

Believe it or not, several million new websites are launched each year, and while some aren’t trying to optimize and some are replacing other defunct sites, it’s no surprise that there’s increasing competition for ad space online.  The way Google AdWords (and other advertising platforms) are set up, you have to bid you get preferred keywords, and when there’s more competition, you’re going to pay more.

At one time, this was easily resolved by using tools to find similar keywords without the same demand, but even that strategy isn’t working so well anymore.  What can you do?  You can still track how many competitors there are for certain keywords and go for ones that have less competition, but you might also want to explore alternative networks for advertising and consider other approaches, like retargeting, that may offer better ROI.

Changing Ad Space

All you have to do is pull up Google to see that the ad space at the top of the page is different than it was just a few years ago.  Not only are top placement ads getting bigger, but there’s less space due to new features like shopping scrollers, info boxes, and so on.  This means limited ad space that got more expensive.  Your only real option here is to make every ad count.  If you’re going to spend the money, make sure your strategies will deliver maximum ROI.

Your Quality Score Has Changed

If you’ve been working with AdWords for a while, you’re probably well aware of your quality score, and if you pay attention, you may have noticed decreases, even if you haven’t made any significant changes, or any changes at all.  Unfortunately, outside factors like Google’s changing definition of “exact match” criteria, can impact your quality score without your knowledge.

Relevance of keywords, ad copy accuracy, click-through rate, landing page relevance, and more are all considered when assigning a quality score, and if exact matches are looking like broad matches, it’s no wonder the relevance of your ads isn’t quite what it used to be.  How can you fix this when you’re not the one who created the problem?

The best thing to do is optimize keywords, ads, and landing pages for the greatest level of relevance and make sure all of your components match up.  You should also unify ad group messaging and campaigns for optimal relevance.  This could help to reduce CPCs that are higher than normal.

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