Google Ads are not always profitable, but they can be when used strategically. The reasons why Google Ads are not profitable for some, include such things as poor keyword selection, poor ad copy optimization, insufficient targeting options, competition and a lack of proper conversion tracking.
I like to refer to Google Ads as a tool. A tool is a device used to accomplish a task. If you know how to use the tool and can apply it correctly, then the tool is useful to you. Google Ads is the same way. It’s a complex tool, but a tool nonetheless. And, if you know how to use it, then you can find a great deal of value in it. It can absolutely generate leads and sales for your business.
If you do not know how to handle this complex tool, then you can run into problems.
9 Reasons Why Google Ads Are Not Profitable
- Poorly Designed Campaigns: Running a successful Google Ads campaign requires a significant amount of time and effort. If campaigns are not properly set up and managed, it can lead to poor performance and low ROI.
- Inadequate Keyword Research: Keyword research is crucial to the success of a Google Ads campaign. Poorly chosen keywords can result in low-quality traffic and low conversion rates. This is a big one! Further reading: What Are Google Ads keywords
- Heavy Use of Broad Match Keywords. Google loves to push broad match, but having too many broad match keywords can lead to wasted ad spend. This can “soak up” a large percentage of your ad spend. As a result, you end up spending too much on irrelevant search queries, generated from your broad match keywords. This is a common occurrence I see in accounts. Further reading: Google Ads Keyword Match Types
- Not Using Negative Keywords. Negative keywords are the antithesis of keywords. You can add negative keywords to keep your ads from showing for certain words or phrases. If you are not actively adding new keywords, then you could be spending money on irrelevant search queries that are not going to drive leads or sales. Further reading: Negative Keywords
- Lack of Targeting: Google Ads allows businesses to target specific audiences, but if targeting is not properly set up, the ads may not reach the right people. This can lead to low click-through rates and low conversion rates.
- High Competition: Some industries are highly competitive, and it can be difficult for businesses to compete with larger companies. High competition can lead to high costs per click and low ROI.
- No Landing Page Optimization: The landing page is the page where users are directed after clicking on an ad. If the landing page is not optimized for conversions, it can lead to low conversion rates and low ROI.
- Not Tracking and Analyzing Results: Google Ads provides detailed data on ad performance, but if businesses do not track and analyze this data, they will not be able to make data-driven decisions and improve their campaigns.
- Not Constantly Optimizing: Google Ads is a flexible platform that allows businesses to make adjustments as needed, but if they do not constantly optimize their campaigns, it can lead to poor performance and low ROI.
Let’s Expand On Some Of These Reasons
For starters, one of the most important aspects to running a successful Google Ads campaign is proper keyword selection. This means that you need to select keywords which accurately reflect what your users are actually searching for. Additionally, you want to target keywords you think will results in qualified leads and sales. When choosing keywords for your campaigns, it’s important to use relevant terms related both to what you are promoting.
Example time! Let’s say you are in the plumbing business and you want to target people who need plumbing services. It would make sense to target terms for things like “plumber near me”, “local plumbing service” and “water heater installers”.
But, keep in mind there are plenty of DIYers online looking for information on how to fix their toilet or leaky faucet. You may not want to target these people. Some keywords that initially make sense, may be commonly used by these DIYers. As a result you could be wasting money on seemingly relevant keywords. Some examples could include phrase match terms like “fix my leaky faucet” or “fix a toilet”. Additionally, you may want to exclude any question-based keywords that include words like “how” or “why”.
Additionally, another key factor for success with Google Ads is ad copy optimization. This means crafting effective and compelling titles and descriptions that are 1) relevant to person’s search query and 2) draws in his/her interest and compels the to click on the ad.
If your chosen keywords don’t contain much information about the business itself then additional details should also be included within the ads in order to inform users more precisely on what they’re going to get before clicking through. Your titles should aim at making people curious and entice them into learning more about offers; mentioning discounts or promotions could help as well.
A quick exercise you can go through would be to write down a handful of unique selling propositions. Ask yourself, “what makes us different from our competition?” You can then refine what you write down into headlines and descriptions for use in your ads.
Additionally, it is always good to use the exact (or similar) keyword phrase in your ads. This helps with relevancy. For example, when someone does a search for something like ‘running shoes for women’, then you want to have that phrase (or similar phrasing) in your ad.
In addition, targeting features such as geographical location and demographics can effectively assist you in getting your messaging in front of your target audience. Ensuring your targeting is accurate can go along way to reducing wasted ad spend and making sure your budget is being used wisely.
For example, through proper geo-targeting, you can increase focus towards those living in your service area. If you only do service in a 20 mile radius around your business, then you will want to make sure you are ONLY targeting that area.
Additionally, if you offer a product or service to people who tend to be in their 30’s or older, then you may want to exclude younger demographics. By default, Google will target all age groups. To exclude an age group, you will have to do so manually.
Conversion tracking is extremely crucial for measuring performance down the road since without tracking data an advertiser won’t know if her efforts are paying off! Through properly setting up conversion tracking, you acquire valuable insights regarding user behavior patterns. You can find out exactly what keywords and ads are leading to conversions (leads or sales, for example). As a result, you can use this data to adjust campaigns accordingly.
For example, let’s say your are running Google Ads to drive leads. If you are properly tracking all phone calls and form submissions, then you can track these leads in Google Ads. Analyzing this data may lead you to move more budget towards keywords that are producing more leads. If you are split testing two different ads in an ad group, you can use the conversion data to determine which ad is performing the best. As a result, you can pause the lower performing ad which would route it’s traffic to the better performing ad
The Wrap Up
I hope this article helped to answer the question, “Why are my Google Ads not profitable?” As you can see, there are many moving parts to running a successful Google Ads campaign. As a result, there could be numerous reasons why Google Ads are not profitable for you. Struggle in any one of these areas can hurt performance. Something as simple as improperly tracking leads or sales can sink a Google Ads campaign. Having an experienced Google Ads management pro oversee your account can go along way to achieving your desired results.