OK, please forgive the play on words.
We have seen a great deal of money spent on AdWords by our clients, some of them are addicted to the top line revenue and some of them can't stand the thought of a revenue decline. Invariably almost all of them lose money on their AdWords campaign.
A quick way to determine if your AdWords campaign is worth the money you are spending is to take your profit per visitor (not profit per order) from AdWords and subtract it from your cost per click in AdWords. In most cases we have seen our clients in the negative. Most of our clients even are negative when we subtract revenue per visit from cost per click.
When does losing money on AdSense make sense?
Cost per acquisition for a new client is easy to absorb if you are in a business that can build a long term relationship with the customer. If you have a lifetime value assigned to a customer than you are ahead of the game and quickly determine how much you can loose to bring that customer to your website.
For long term success you need to be able to attract more visitor through organic search and marketing efforts that you attract via AdWords. If you don't have a plan for this transition, we can help.
