If you are an experienced Adwords manager, you probably had clients that want bigger market share, lower marketing cost/cost per conversion or just want best value for their budget (Not to mention all the crazy goals, like top ranking for the keyword the CEO mentioned).
I am focusing on improving the Adwords account as much as possible. I might have an opinion if the improvement should go for a bigger market share or lower cost for the same market share.
I find there is an advantage in letting my client decide. It let them be in the habit of paying if they want something.
So next time they ask if I can help them sell more, they know they either need to pay for improving Adwords or buy more leads.
Part one: Relationship between market share and price per conversion
This is what confuse many, in relationship with general improvement.
If we assume linear connection between price per conversion and market share, we get the following graph.
If you increase you bids, you will have to pay more per conversion, but you also get a higher market share. And your market share will decrease, if you lower your bids, together with your cost per conversion.
Part two: What happen when you improve your Adwords account?
You switch the line down.
Your client can choose to keep that same market share and get a lower cost per conversion or keep the same price per conversion and get a bigger market share. Most of my clients choose something in between, but any prices per conversion gives a market share.
Part three: How do you improve the Adwords-account and what does it cost?
Now you can explain what you can do to improve the Adwords account and what it cost.
If you charge a fixed percent for Adwords management you can illustrate it like this:
If you can move the graph longer downwards, than the additional cost, your client will make a profit.
You are welcome to use the graphs, but remember to link back to the source(this page).
Disclaim: As most experience Adwords-managers know, the relationship between price per conversion and market share isn’t linear. There are to many factors that influence the shape, but I believe that most Adwords managers know the connections: When you increase bids, you start paying more per conversion and get a bigger market share (except in some rare cases).