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Forecasting PPC Data

Friday, 12 July 2013

Forecasting PPC performance is always a tricky task. There are so many variables that can change things; it makes it tricky to provide accurate forecasts. However, If you take the following 5 things into consideration when forecasting you should find yourself being more accurate every day.

30 isn’t the magic number
One thing I’ve observed from forecasting I’ve seen people do in the past is that they always use 30 days as an average day count for a month. If you are doing a rally basic forecast then that’s fine. But when you’re managing PPC budgets every day it makes a huge difference. If your budget is £10k per month then Feb’13 will mean £357 per day and when you switch to March (31 days) you daily budget will drop £322. This shouldn’t be the reason you drop budget. It should be based on seasonal performance, day of week performance and weighting the budget accordingly. Not just at the mercy of the calendar.
In addition if we look at October 2012 for example. It has 31 days in total but Monday, Tuesday and Wednesday occur 5 times and Thursday – Sunday occur just 4 times. If Monday-Wednesday is a key part of the week for sales, your monthly performance will be much better! Take this into account when you forecast – you will have a more accurate set of data to use as a target.

I mentioned this above but if you’re not taking seasonality into account when you are setting your budgets then you shouldn’t be allowed to do any PPC forecasting. Simples
If you don’t have any historical data to go on, use your common sense (Q4 for retail around xmas, Q1 for travel etc etc) to start getting some budget allocated. Also, see if there is any other online sales data available you can use to help identify trends. It won’t be exact but it will definitely help you. If you use an agency, lean on them heavily for this. They will have multiple clients and some may operate in the same industry so they are well placed to provide an estimated trend.

Measure performance daily
Track your account daily. This doesn’t mean that you overanalyse it each day but when you start to see patterns of growth or decline, you will have the daily performance data on hand. Keep then on file so you can go back to them for quick reference. The worst thing that can happen is that performance drops off but you only notice it when you look at a weekly report. It could have been improved earlier in the week or if the performance is good, it could have been even better!

Adjust your forecast during the month
Don’t be afraid to reforecast 1-2 times during the month. Especially if you are reporting to a client or to internal stakeholders. You need to manage expectations of everyone involved. If you reforecast lower performance, you can explain why and they will have better understanding. If you don’t reforecast and they see end of month results 20% down, you’ll be in trouble ;-)

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