Part 1 You are considering launching a Google AdWords campaign to promote your new Marketing Agency, "Luminous". Currently, your budget is $2,500 and you are curious to see what kind of results you'll get from this investment. You've conducted keyword research using Google's Keyword Planner and have determined that the average CPC is approximately $1.25. Thinking conservatively, you are expecting your ad to get a 1% click through rate which will lead traffic to a specific landing page you created. On your landing page you anticipate 3% of your visitors will click the "make an appointment today" button to learn more about your marketing services. If 25% of those appointments result in a hiring agreement, and the average price of your consulting package is $12,500, will the investment in AdWord have been worth it? 1. Complete the worksheet to perform an analysis of your paid search investment Impressions Clicks CTR % Visitor CVR % Leads Conversions Lead CVR Budget CPC Consulting price Revenue Profit ROAS ROAS % % 2. Based on your analysis above, do you think investing in Google AdWords is worth the expense? Use data to support your answer: do not just answer, "yes" or "no". Part 2 1. If you had a paid search budget of $1000, and you determined that your average CPC would cost $2.50, how many clicks could you receive before your budget is fully spent? 2. You decided to launch a new Ad Campaign and after performing some keyword research, you determined that your average CPC would be $1.00. Based on your previous experience with paid search, you estimate your Ad will receive a 1.8% CTR and that your Ad will get a total of 60,000 impressions. Based on all of this, how much of your budget will you spend on this particular campaign? 3. For a different campaign, you have determined your average CPC is $2.00. Now you are wondering how high your conversion rate can be if your cost per action/acquisition ("CPA") is $10? 4. Imagine your friend who runs a small online retail business has a $3000 budget to invest in paid search. They have determined that their average CPC is $0.50 and that their conversion rate is 5%. How can you help them figure out what their CPA is? 5. Based on the information from above, your friend asks how many conversions they can get for their $3000 budget. What do you tell them? 3 6. Assume you buy cotton fabric from a wholesaler for $10 a package. You make beeswax wraps which you resell for $50 a package. Your shipping costs $5 for each order and you want to build into your budget a target profit of $20 for each order. Based on this, what should your target CPA be? 7. Based on the information from above, and knowing that your average CPC will cost $3, what would be your target conversion rate? 8. And based on the information from above, how many clicks do you need to have before you get a single sale