Company X, an e-commerce company specializing in sewing and crafting supplies, partnered with our agency to explore the potential of Google PPC ads to increase their online sales. The objective was to determine if a positive return on investment (ROI) could be achieved while avoiding excessive spending on non-converting clicks. This case study analyzes the campaign’s performance and its impact on Company X’s e-commerce sales.
Background and Objectives
Company X approached our agency with a limited budget, seeking to test the effectiveness of Google PPC Ads in driving sales. The primary concern was minimizing the risk of overspending on costly clicks that would not result in conversions. The initial phase of the campaign aimed to identify target audiences and evaluate the revenue generated in relation to ad spend, measured through the Return on Ad Spend (ROAS) metric.
Campaign Timeline and Results
April 2019 – June 2019:
During this period, the campaign was launched with a modest ad spend of $3,300. The outcomes observed were as follows:
- Generated Sales Revenues: $5,930
- Traffic (Number of Clicks): >6,000
- ROAS: 177% (For every $1.00 in PPC ad spend, $1.77 in revenue was generated)
See the results recapped below in the chart.
These results indicated a positive ROI, demonstrating the campaign’s potential for generating sales at a profitable rate.
Last 365 Days:
Moving forward to the most recent 12 months of 2022 and 2023, Company X significantly increased its PPC spend to $212,000. The outcomes during this period were as follows:
- PPC Spend: $212,000
- Sales Revenues: $1,510,000
- Traffic (Number of Clicks): >300,000
- ROAS: 714% (For every $1.00 in Google PPC Ad spend, $7.14 in revenue was generated)
See the data below, which shows each of the performance metrics.
The campaign’s performance had substantially improved compared to its initial phase in 2019, showcasing the following growth:
- ROAS (Return on ad spend) of 714%.
- For every $1.00 in Google PPC Ad spend, we generate $7.14 in revenue
- This is a difference from when the campaign started in 2019.
Strategy and Approach
The campaign initially started with a low PPC budget to mitigate financial risks while still generating meaningful sales. The strategy focused on finding the optimal spending level that would yield a positive ROI. This allowed for gathering data on target audience responses to Google ads and enabled campaign expansion to include more products and wider audience reach.
As positive results and consistent conversion performance were observed, the campaign was continuously optimized. Notably, the budget was concentrated on “high-return” product groups, maximizing the ROAS. Research, data analysis, and ad optimization were instrumental in achieving these outcomes.
Conclusion
Company X Google PPC Ads campaign has evolved and matured over time, leading to substantial improvements in ROAS. The continuous optimization efforts, combined with effective targeting, messaging, and ad strategies, have resulted in more successful campaigns generating higher returns.
By investing just over $200,000 in Google Paid Ads over the course of a year, Company X achieved sales revenues exceeding $1,500,000. The estimated return on investment ranges between $1.2M to $1.3M, excluding operational and product costs. The campaign’s ROAS consistently exceeded 700%, indicating the reliability and profitability of increasing ad spend to drive revenue growth.
This case study demonstrates the significance of ongoing optimization and improvement in Google Ads campaigns to achieve higher ROAS and overall campaign performance. The success achieved by Company X highlights the potential impact of refined targeting, messaging, and ad optimization strategies, enabling companies.
