Recommend Budget for Google Advertising in Dropshipping Campaign

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How to set a budget for Google Advertising in Dropshipping

Building a Google Advertising budget is one of the most challenging obstacles confronting new and old drop shippers, no matter where you are on your eCommerce tour.

The task of preparing an advertising campaign for an eCommerce store can feel complicated, time-consuming, and challenging. A well-planned budget, particularly at the beginning, is, however, a considerable part of the success of all of our participants.

Yeah, you want to invest in advertising, so why don’t you? If, in the end, you will invest money to earn more. Members inquire all the time, ‘Anton, if I’m just getting started, how do I set my budget for Google Ads?’

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shopify dropshipping store set up

One of the questions that many people ask about Google Advertising is, is there a minimum I can get away with? The reason people ask themselves this very reasonable question is because those who are new to eCommerce are concerned that their money will be spent on something they don’t know will work.

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What is Google Ads’ Minimum Advertisement Budget?

The purpose of your spending on Google Advertising should always be to get the highest return on your money. If you have a million dollars in the bank or $10, the fact is, Google Ads doesn’t have a minimum advertisement budget.

But when you’re running paid traffic and setting up your first Google shopping campaign ever, you need to know that the goal is not just to make sales. The aim is to do market analysis at the start. In the beginning, purchasing data is where your ad dollars go.

But before you launch your first marketing campaign, you should do stuff; use the Google keyword planner to look at your rivals or potential competitors around you. You have to remember that when you set up your advertisements and people start seeing them in Google search results, the statistics that Google might show you are not as reliable as what you can find. The best data you’ll get is when you turn on your ads.

When you first begin a campaign for Google Advertising, you already know that the aim is to get data so that you can see what works and what doesn’t. You can then use the data to cut back on what doesn’t work and then double down or quadruple down on what does.

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Let’s assume that you have a dropshipping store currently converting at 1% from PLAs, from Google traffic, from Google shopping traffic, to keep it easy. Today, if 1 percent converts, that means you get one deal for every 100 guests, right?

Let’s presume that on Google Advertising, you set up your first campaign, and it costs you $1 a click. But that means you’ve got 1 CPC dollar. Now, all that means is that you will get a sale for every 100 clicks you get, right? And you’re converting at 1%, which means you have to spend $100 on commercials to make the initial sale.

Today, ideally, the Drop Ship Lifestyle system is being pursued, and you have selected a highly lucrative niche. The selling, thus, was $1,000+. Remember that when you want to assess your budget, that’s sort of what you have to worry about.

If the target were $100 a day, it would be equivalent to one sale a day and still enough details to let you know what the commodity is transforming.

Your First Goal When Setting up Google Ads

Now, let’s presume it was $10 a day on your schedule, right? Since you were just getting started with eCommerce and you were like, “You know what? I feel comfortable with a $10 a day budget.” Yeah, it will mean that every ten days, you would have one deal.

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“On the other hand, if you’re just getting started and are super nervous because you’re so brand new to this, you might think, “I don’t want to invest more money into this until I know its working.

Then bring it down, starting at $5 a day for a Google Advertising budget. Note, there is no law on Google that you have to pay “X dollar amount” to them. You will adjust your budget to be anything you feel more comfortable with if you go through your Google Advertising account.

So if 1 percent was converted from your shop and you have a budget of $5 a day, it means you would plan to make one sale every 20 days. So it could take you 20 days, hopefully, to get the first transaction with the $5 a day budget. What does that mean now?

Would that mean that you can wait 20 days and see what’s going to happen to see what’s going to sell?

No, you shouldn’t, in my experience, but we can make things a lot smoother, which I’m about to teach you how to do. But, if you have this “I’m just going to spend $5 a day” mentality, and ten days go by, 15 days go by, and there are no sales yet. Well, if your shop is converting at 1 percent, then that’s usual, so it takes you some time again.

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shopify dropshipping store set up
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How to determine the budget for your first month of Google Ads

This may sound like a lot, but I was hoping you could set it at $1,000 for your first month’s advertising budget. Stick with me here, and you’ll see why this number doesn’t sound so crazy.

Setting your budget for Google Ads at $1,000 for the first month means spending about $33 a day. As I mentioned before, if you get clicks for a dollar, then you will have 33 visitors “ready to buy” every day.

If you do this and have this kind of budget setup for Google Ads, and you have that conversion rate of 1 percent, you could expect one sale per three days.

Now, what’s good about this advertising budget is that you can get data quickly. You’re not rushing it in the sense where you spend $100 a day; several people are uncomfortable with it within the beginning.

Don’t say, however, “For the next year, I’m going to spend $5 a day.” What you want to do is spend $33 a day for the first month and monitor what will happen at your Shopify store. What you’re doing with this initial money is watching what’s going on and feeling the market out.

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Plus, it’s straightforward to see what you get in terms of your website impressions within Google Ads. Images are how many people visit your various ads for different products. It’s easy to see how many people click on the links to go to your website’s other product pages, and it’s easy to see what percentage of the share of search volume you have.

What that means is that you may find you’re spending this money and selling a few products over and over and over again. That’s good news because you may be bidding too low. After all, there’s more paid traffic to be had.

You want to make sales, but you want to get those analytics and do market research for the whole purpose of doing this Google Ads strategy. It’s buying the data so that you can see what ads to cut and which ones to double down on.

This is called “trimming the fat” by my friend, paid traffic guru, and Search Scientists founder, Michael Erickson. He created our eCommerce course for Google Ads and went deep into this strategy. But what it comes down to is this: raise your budget, get more traffic, see how your conversion rate holds up and make sure your ads are still profitable.

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When you first start on Google Ads, there is no minimum for just a reminder, but if you plan to spend $5 a day, as I just explained, and your store is converting at 1 percent, expect about 20 days to see what’s working and what’s not.

And I know that many people don’t want to wait that long, so if you’re going to wait three days instead of 20 days, start with a higher budget for advertising. Again, you could bid lower; you could stay longer. It’s all up to you and how you want to go about it.

Growing your budget for advertising… The right way

On the other hand, in Google Ads, what’s the maximum amount you should go with? Well, there aren’t any! You could have an unlimited budget, and I’m sure it would make Google very happy. To many people who are brand new to eCommerce, this probably sounds crazy, especially since I just told you to start at $33 a day, but here is the thing…

The goal is to get a return on your investment by spending money on the business. The same goes for setting a budget for Google Ads, so you want to get a good return.

If you spent $100 on Google Ads that earned you $1,000 in sales and your profit was 30 percent, and you then take out ad spending. You make 200 dollars per sale! That means you spend $100 to get back $200 in net profit.

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How often would you want this to be done? As frequently as you can! Would you give $1 to somebody to get back $2 in profit? The reply is yes.

Once you know your return on ad spending, once you see what works inside and in the dashboard of your Google Ads account, that’s when you start spending more on converting products.

I don’t want you to go crazy and double your budget for Google Ads when I tell you to spend more. Don’t think, “This worked for $1,000. Let me spend $10,000.” So just slightly up your advertising budget.

Monitoring and adjusting your budget for Google Ads

Go into your Google Ads account and pull the shopping campaign report after you increase your budget. Take a look at where you get clicks and where you don’t. You’re going to see what people buy, what they aren’t, and the things they click and don’t buy.

Then you’re going to optimize your eCommerce store to get people to choose and buy those products once they get to your store. And you’re going to make sure that as you spend more cash, the things they believe will lead you to get more clicks and more sales. As long as your target return on ad spending falls within that, then guess what? You will keep going up there!

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You want to do it every two weeks, depending on the size of your Google Ads account. You want to do it every month sometimes. If your account gets big and you get to the point where you spend $100,000 plus advertising a month, then you want to have a monitor every day.

At Drop Ship Lifestyle, that’s what we do. Every day, we are literally in our Google account, in our Facebook Ads account. My team is watching what’s going on because we need to make sure our return on ad spending is precisely where we want it to be.

How to Budget Your Advertising on Google Ads

Listen, if you can afford it, if you’re comfortable, this is what you should do: Set aside $1,000, put it in your advertising budget for the next month. Look at your information, see what works, cut down on what isn’t, and then double down on what it is.

And once you do that, you can get to the point where you can go ahead next month and raise your bids, increase your budget, and continue to increase your revenue. That’s what will boost your income at the end of the day.

The more share of the search you can get, the more impressions, the more clicks, the more sales they all translate. This is how, from $100,000 a month to $300,000 a month to $500,000 a month, an eCommerce business can grow. It’s by getting good at Google Ads.

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Wrapping up How to set the budget for your first Google Ads

This is our own Service Offered by the Blog Author.

shopify dropshipping store set up

This post is an overview for beginners of what to do with new stores and initially set up your advertising budget. If you’ve made it this far, I’m excited to share that we’ve just updated our eCommerce course with Google Ads.

Update, I say, but it was a complete rebuild from the ground up. It was created by Michael from Search Scientists using the same strategies he uses for the stores of his customers. He’s spent MILLIONS on Google Ads at this point, which is crazy to think about.

That’s why I introduced him to this course. He’s a genius, and it’s fantastic this new paid traffic training.

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