1. Diving in headfirst
Due to the complexity of the process, diving in headfirst can be a bad choice.
PPC calls for a thorough understanding of the target market, the SaaS product, the audience, and the most effective ways to reach the audience.
Without this information, you as a SaaS founder risk spending a lot of money on unsuccessful initiatives and getting a poor return on your investment.
Establishing a PPC campaign without conducting adequate research can result in a subpar user experience because the advertising might not be pertinent to the intended audience. You need to understand the messages your audience is going to resonate with and how they change as users move further down the sales funnel.
If you are diving into PPC or hiring a vendor to do it for you and they are not asking all the right questions you need to stop, reflect, make sure you are making choices based on the correct information, and only then move on.
2. Throwing in the towel too soon
Your PPC campaign will not be a "one-and-done" advertisement; it will require ongoing marketing management and patience on your part.
Expecting to hit the ground running and meet those dreaded ROAS goals in the first month will only lead to disappointment and failed business relationships.
When I tell SaaS prospects that they should not expect to be satisfied with the results of a new account for the first 60 to 90 days, the conversation frequently comes to a halt.
Some vendors decide to withhold that information but everyone knows it's true.
You must be willing to play the long game.
It takes time for the algorithm to learn. You must feed it the correct data. It takes some time.
If you are not patient you may pull the trigger just when you were about to get the breakthrough you needed.
3. Failing to focus on what matters
Getting clear on KPIs and main conversion events is probably the most important thing you can do in today's world, where advertisers are increasingly leaning toward AI and machine learning.
And it is one of the aspects of the initial campaign setup where I see most people making compromises and taking shortcuts.
This is not important solely for the sake of the algorithm.
You can't make smart decisions if you have no or incorrect data.
You can't be complacent and make a mistake in the conversation setup.
You have to get this right.
4. Measuring success against the wrong metrics
This is a big one. I see it quite often.
You should be working backward from value.
If you are building your CPL or CAC targets against your initial purchases and review a new customer bring and not looking at your LTV (lifetime customer value).
A customer's lifetime value is the total amount of money a customer is expected to generate over the lifetime of their relationship.
It’s difficult to get this spot on, early into your business development and this is a problem I’ve seen with SaaS startups often.
SaaS Startups must balance the costs of acquiring customers with the revenue generated by those customers. Now you have to be thinking about things long term, but they must also consider cash flow.
If you have a high LTV but low initial and short-term revenue from a sale, you may run into liquidity problems if you are not careful.
So you need to find a balance here.
The most common LTV formula used by startups is:
LTV = (Revenue per customer – Customer acquisition costs – Customer service costs) / (Churn rate + Discount rate)
Find a sweet spot and work with that.
5. Underestimating CTR
CTR simply isn't getting the credit it deserves.
It's just not sexy enough to be the main topic of conversation at client or internal PPC meetings.
So let's explore why this is a mistake that can seriously harm your ad performance.
The first and most obvious reason why CTR is important is that it helps you determine whether your ads are good enough to catch the audience's attention and pique their interest enough for them to click on them.
Is it, however, that simple?
What if your ad copy is fantastic and your ad design is flawless? You've done your research and developed the ideal hook. Could it be that your targeting is completely inaccurate?
It sure can.
But what if your ad copy is fantastic and your ad design is flawless? You've done your research, created the perfect hook, and perfected your targeting. Could it be that you're sending out the wrong messages at the wrong stage of the buyer's life cycle?
There is so much underlining information you can discover by looking at CTR and failing to acknowledge that is a big mistake.
But what about its effect direct and indirect on campaign performance?
A low CTR means less visibility, fewer impressions, and fewer clicks, leads, and conversions. More importantly, it may have a negative impact on your Quality Score.
What happens if you keep running ads with low CTR?
You will lower your quality score and make it more difficult for your ads to appear first in paid search results. As a result, CPCs rise, resulting in more expensive traffic and higher CPAs.
6. Death by keyword micromanagement
This is a MAJOR one!
This is not just for SaaS PPC campaigns but for everyone running PPC campaigns.
The majority of your sales will come from a small subset of your keywords.
You must narrow your focus, and there is a proper way to conduct keyword research, initial campaign setup and continuously test alternatives.
Concentrate first on keywords at the bottom of the PPC marketing funnel, then broaden your scope once you've achieved success.
Just please, don't go overboard.
Don't get hung up on getting 100% relevant traffic.
Don't be afraid to use phrases or broad match keywords.
I'm not suggesting you use broad match. What I mean is that there is a time and place for broad as a match type. If you trust your PPC partner, trust them to know when it’s a good idea to go broad.
If you see some irrelevant traffic in the SQR report, take a deep breath. It’s ok. It’s normal.
Allow your PPC specialist to do their work. The more you micromanage details, the more difficult it is for them to do their job and deliver the results you require.
Leave the keyword choices to the person you’ve decided to trust with your PPC efforts and focus on the end result.
7. Focusing on trials generated and ignoring upgrade rates
I believe this is self-explanatory, but I've seen far too many accounts in which the trial-to-sale conversion ratio was ignored.
I understand that risk and sacrifice are required for growth, but that doesn't mean blowing through your budget, getting thousands of signups, and never making enough money to at least fund your PPC efforts.
8. Underestimating Brand Awareness
If you believe that clients only subscribe to Software as a Service providers because of the features or the cost, think again. SaaS services can undoubtedly help consumers find solutions to their problems, but that isn't the only thing they consider. They are seeking for a brand name, a guarantee of value, dependability, and quality. Users are looking for a partner who can stand out and be unique.
Every shrewd SaaS business owner should have PPC awareness efforts incorporated into their ad campaigns to boost their brand strategy.
9. Doing it all on your own
PPC is straightforward to learn but difficult to master.
If you as a business owner, startup founder, or manager, think you have the answers but haven’t been deep down into PPC platforms for years, you probably don’t.
Your time is worth far more elsewhere, as well, so consider that.
Get assistance, and you'll fare far better for yourself, your company, and your investors.
That's it. The aforementioned doesn't offer any novel insights, but these are mistakes that knowledgeable, successful businesspeople make far too frequently.