For most small- and medium-sized business owners, you can’t expect customers to find you without some level of advertising. But ads can be extremely expensive, often with little in the way of results to show for it.

Today, SMBs are overwhelmingly focused on online ads rather than pricy print, television, or billboard media, but even online ad expenses can quickly spiral out of control if they’re not kept in check. We spoke to several online ad pros about how to squeeze every last penny out of those ad budget dollars. Here’s what we learned.

Set Up Ad Tracking First

Before you start tinkering with your ad strategy, it’s important to know where your money is going, by carefully tracking campaigns, keywords, prospects, and more. “It’s impossible to scale or optimize what you can’t see, so campaign tracking is crucial to stretching your ad budget,” says Meagan French, president of marketing consultancy Lotus Growth. “The easiest way to set up tracking is by creating goals in Google Analytics to track conversions… and it’s free.”

Google Analytics and other tracking systems can be complex to master, so it’s best to start slowly with some inexpensive test ads (start with $10 a day, for example) so you get comfortable with tracking and ensure you have everything set up properly before investing additional funds.

Hone Your PPC Keyword Strategy

It can be tempting to throw money at the broad keywords that get the most search traffic, but that strategy often ends in an arms race of price escalation with other bidders. For example, Google AdWords’ “suggested bid” for the search term “baseball bats” runs $1.27 per click, while an ad for the more specific “8 year old baseball bats” would cost only $0.56. Traffic is much, much lower for the latter term, but it also represents a laser-focused customer who can be targeted with a very specific advertisement.

Wendi A. Henderhan, founder of bankruptcy-focused Henderhan Law Offices in Ohio, says this works across industries, saying, “Rather than bid on just ‘bankruptcy’ keywords from an online advertising perspective, we broke it down even further. I knew that Chapter 13 related bankruptcy keywords would generate more high quality leads for my firm. Even though the search volume isn’t as high as Chapter 7 keywords, I was willing to take quality over quantity. Additionally, rather than target the entire Columbus market, I geo-targeted specific zip codes so the advertisements would hit our ideal prospective customer.”

Another solid strategy to save money is to use highly specific keywords that won’t attract “casual” web browsers. Andrew Harrison of Zeus Legal Funding relates a story about using terms like “blue pencil severance lawyer” and “constructive discharge lawyer” in ads that were designed to target lawyers (rather than consumers). “These are terms that most lawyers understand, but most ordinary citizens who are searching for a lawyer wouldn’t know them,” he says.

Get Serious About Retargeting

Have you ever visited a website, then later that day seen an ad for that website somewhere else? If so, you’ve experienced retargeting, considered one of the most powerful online ad strategies available because it shows ads to people who have already visited your site. “While it’s great to be able to market to new people, marketing to people who already know about you but haven’t converted yet often returns a much higher ROI, and will help you maximize your small ad budget,” says John Turner, CEO of meditation website QuietKit.

Retargeting isn’t just effective, it’s also usually quite affordable. “Just by introducing retargeting as part of our strategy, I have been able to cut our customer acquisition cost by a third,” says Nenad Cuk, marketing manager of branding and design shop ThoughtLab. “We now have more people converting and a lower overall cost of advertising.”

Experiment Via A/B Testing

One of the keys to stretching your ad budget is to make sure your ads are working as effectively as possible. How do you do this? By testing different ads simultaneously to see which performs the best. “Test two different variations of copy, creative, or landing page and see which one has a higher click-through or conversion rate,” says French. “Then repeat, repeat, repeat. This will improve the quality of your ad campaigns, find messaging that resonates with your customers, and drive down advertising costs. We’ve improved our click-through rates on ads by 3x by testing different ad copy.”

In this extensive article, Optimizely offers much greater detail about how to put A/B testing to work for you.


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About the Author: Christopher Null is an award-winning business and technology journalist. His work frequently appears on Wired, PC World, and TechBeacon. Follow him on Twitter @christophernull.