…is the question that we are asked by nearly every prospective client. It’s also a tough one to answer and is sometimes more of a business decision than a PPC decision. However, we’re going to do our best to give you the tools so that we can work together to come up with a starting budget with a high probability of success.
Notice we said starting budget? This is because once your campaign has a few weeks or a month under its belt, the numbers get much more quantifiable.
Here are four key factors that make up the ad budget criteria:
1. The population in your area
2. The competition in your area
3. How many cases you want to retain
4. The size of your firm and how much you can reasonably spend
Let’s try to expand upon these criteria.
1. Your Population – If you are in a major metropolis or cover a huge geographic area, your budget has the potential to be very large.
A firm serving all of Southern California can easily spend six-figures per month depending on how aggressive they want to be. Whereas a firm in a rural part of Kentucky may not be able to spend more than $10,000 per month due only to the limited number of people living there who need an attorney.
2. Your Competition – This one is tough and varies dramatically by geography and case type. “Truck accident lawyer” in Texas is very expensive and far more costly than “family lawyer” in Erie, PA. This can differ from region to region. So much of this depends on your competition.
To add more complexity, there are national firms that drive up cost-per-click even in areas with no local competition. Nursing home abuse cases are one of these areas. Lead gen companies can also drive this cost up.
3. Your New Cases – Once you determine cost per click based on the above factor, then you can back into a number based on how many cases you want to sign per month. Of course, the answer is “as many as possible,” but we mean how many you want to spend money signing and how much you want to spend per signed case (see point no. 4).
If for example, your cost per signed case is $1,000 – for easy math – and you want 8 cases per month, then your budget should be about $8,000.
4. Your Resources – PPC is a bit of a gamble, especially at first and especially when viewed over a short window of time. At first your campaign may not be optimized as well as needed in order to be efficient and some months it may not return the level of positive ROI that you’re seeking.
On the other hand, some months it may return attractive multiples of return-on-investment. This is why PPC campaigns should be looked at on a long-term basis.
As they say, never bet more than you can afford to lose. PPC shouldn’t be a risky gamble, but as with all advertising, there is always a risk. This risk is especially high if you can’t afford to stay in the game long enough to garner a few wins.
If you’d like to run your own numbers and estimate your own cost per case and return-on-investment, feel free to try out our ROI calculator here.