Lowering Cost Per Acquisition (CPA) for an ecommerce business on Google Ads can significantly improve your return on investment (ROI) and overall profitability. Here are three effective strategies to make this happen, and scale the ecommerce PPC operations to the next level:

1. Optimize Ad Targeting with Audiences

  • Refine Audience Segmentation: Use Google Ads’ audience segmentation features to target the most relevant and high-intent customers. Create detailed customer personas based on demographics, interests, and past behaviors. By narrowing down your audience to those most likely to convert, you can reduce wasted ad spend and lower your CPA. That feature should be utilized in addition to proper use of keywords.
  • Utilize Remarketing: Implement remarketing campaigns to target users who have previously visited your site but did not complete a purchase. Remarketing helps keep your brand top-of-mind and encourages these potential customers to return and convert. Customizing your ads based on the user’s previous interactions with your site can increase conversion rates and reduce CPA. However, since the shift the first-party date, seem like Google’s remarketing hasn’t been as effective as it used to be. Keep a close eye on the eCommerce PPC KPIs to determine whether it’s working or not.
  • Leverage In-Market Audiences: Google Ads offers in-market audiences, which are groups of users actively researching or comparing products and services similar to yours. Targeting these users can increase the likelihood of conversions, as they are already in the consideration phase of their purchasing journey.

2. Improve Ad Quality and Relevance

  • Enhance Ad Copy and Creative: Craft compelling ad copy and use high-quality images or videos that resonate with your target audience. Highlight unique selling points (USPs), solutions, promotions, and calls-to-action (CTAs) that encourage clicks and conversions. A/B test and experiment different versions of your ads to determine which perform best. This is an ongoing process that never ends!
  • Optimize Landing Pages: Ensure that your landing pages are optimized for conversions and the experience is on-point. This includes having a clear and compelling headline, easy navigation, fast loading times, and a straightforward path to purchase. Consistency between your ad copy and landing page content is crucial for maintaining user interest and reducing bounce rates, so don’t forget to apply the keywords you’re targeting on the LP.
  • Use Ad Extensions: Ad extensions provide additional information and increase the visibility of your ads, making them more appealing to potential customers. Extensions like site links, callouts, and structured snippets can provide more context and encourage higher click-through rates (CTR), which can contribute to a lower CPA. Ad extensions could display more ad features on a greater real-estate what could cause the ads to be more visible.

3. Implement Smart Bidding Strategies

  • Utilize Target CPA Bidding: Google Ads offers automated bidding strategies such as Target CPA, which optimizes bids to achieve your desired CPA. By using machine learning, Google adjusts bids in real-time based on the likelihood of a conversion. This can help you maintain control over your CPA while maximizing conversions. To make this strategy work, one would need to have a certain amount of conversions and ideally upload offline conversion data to supplement the AI algorithm.
  • Analyze and Adjust Bid Modifiers: Use bid modifiers to increase or decrease bids based on factors such as device, location, time of day, and audience. For example, if you notice higher conversion rates on mobile devices, you can increase your bid for mobile traffic. Adjusting bids based on performance data can help you allocate your budget more efficiently and lower your CPA.
  • Monitor and Exclude Poor-Performing Keywords: Regularly analyze your keyword performance and identify those that generate clicks but do not convert well. Use negative keywords to exclude irrelevant or underperforming search terms from triggering your ads. This helps prevent wasted spend on low-quality traffic and focuses your budget on keywords that are more likely to convert.

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