8 May 2020, last updated — 27 August 2020

Review: We have cut costs by 35% with the budget for PPC over 100,000 $

I am Sasha Hlevnyuk. I am responsible for sales, marketing and analytics in iDeal Solutions company.

This is a product company, offering solutions for M&A operations (support with merges and acquisitions) and our product is a virtual data room. Well, it can be regarded as, say, Dropbox, which is equipped with some really specific functions, providing security for those operations.

I can say that it was a classic long sale. I might be wrong, but it seems to me Roman first caught my attention 5-7 years ago as a marketing specialist in Ukraine. But in the context of the tasks I used to have, there wasn’t a need in cooperation yet.

And step by step, year after year, I had a feeling you are the person I can try and start working with within my range of tasks.

And probably the last qualifying criterion was the first stage of the project when we were analyzing our needs and our current position and you were conducting an audit. And the way you conducted it, accompanied by your findings, was kind of a signal that we can proceed to project work.

Task

In the structure of our acquisition process the paid channel is quite substantial, but at the same time, it has certain limitations. I.e., I can’t say that we belong to the game development niche, where you can constantly buy more and more traffic, but there is a particular demand in the world, which in a way is regulated by M&A operations, taking place globally. It means, that in the economic boom the demand is increased, and in the world economic recession the demand is decreased. And consequently, paid traffic, especially in AdWords, has such a correlation, but the scope is limited.

At the end of the last year, on one hand, we got to the point of realization that we do collect the significant part of that digital traffic in AdWords, but it was unclear if we use the money efficiently.

There were many indirect indications, showing that the same volume can be used with a certain level of economy. And … On the other hand, the way our AdWords and other connected digital channels developed wasn’t systemic. I.e., it was a new function, which had been developing for the last 2 years and we had a certain understanding of the lack of internal expertise, how to work with these channels.

And having such factors and such aims, we started entering the project trying to find who will be able to increase our internal expertise on one hand and on the other hand help us solve the task on traffic cost optimization.

Result

We have solved the task. I can’t say how exactly it was done.

In my estimation, it took about 3-4 months to reach the point where we could draw conclusions and say: “Yes, really, here’s an interval, here’s an interval, we see the difference”.

First of all, we have significantly cut costs. If to take the average costs, we have cut them by 35-40%. And these are significant amounts of money.

On one hand, by spring we optimized the cost of traffic and it seemed some kind of a plateau from the point of view of our further development, but at the same time we got into a new situation when there was a change in demand in the world, the competition started to increase, there were fewer leads in the search, our competitors started entering those channels more actively. And it was the point when we realized that it was necessary to grow despite general decline, that’s it.

And I can say, that we … solved that task. If to compare acquisition from the point of view of off-brand traffic, last autumn the situation at the market was stable, and the market was even booming in a way, whereas in spring and summer of the current year there was a certain decline. But despite those trends, we even increased the number of acquired leads by 30%. So, even though our goal was initially out of scope, and when we started there were no definite signals, we managed to reach it by focusing our attention.

The cost of the mistake

So, the cost of traffic for those niche audiences is usually higher and one can say that, say, within AdWords a click might cost $20-30-40 on average, whereas some other expenses can constitute up to $100 and $150. And as we understand, if there are difficulties with conversion, if there are difficulties with certain stages of the funnel, those cases can easily lead to losses. I can say that we are now ready to pay more than $1000 for the lead itself. Consequently, due to the fact that the cost of the click is quite high, it’s very easy to exceed these frames, i.e. set up certain campaigns incorrectly or set up certain limits in the wrong way and where the cost of lead was $1000 it can become $1800. So, quite a substantial error can occur.

That’s why the cost of the mistake is high, the overall marketing budget for the paid channels in our case exceeds $100,000, and consequently, fluctuations of 30-40% were quite significant from the point of view of their effect.

And coming back to the previous comment about the role of the agency or the cost of the servicing the channel, as you can see, the cost of the mistake might be 10-20-30 times higher than the expenses on the internal specialists or, say, external agencies.

And I can’t say those challenges have come to a halt, because there are some DDoS attacks, some click frauds, some other malicious operations on the internet, which make up the traffic. And in our case, the cost of the absence of control can easily turn into the loss of tens of thousands of dollars and can be really sensitive.

Value

Before having worked with you, I had an experience of working with other agencies in Ukraine, which can be regarded as top ones. The main context of their drawbacks was connected to the fact that those companies got really extended both vertically and horizontally. On one hand, you work with a specialist or two, they have their mindset for solving your task, but the people responsible for the decision-making process in this team or all the teams, those who work with the clients, they are very far up the vertical and the feedback can be really limited in the context of its effectiveness, because, yes, they will always listen to you and say: “Sure, we understand what needs to be enforced here and there”, but the opportunities of those people to change anything are minimal. I.e. if they can’t afford an analyst within their budget, they can’t include one in the staff, they have their limitations for such tasks or if there’s some crisis policy in place in the company in general, they just can’t in a particular moment or month or other sets of time pay more attention to your tasks, because they have their manager, saying: “No, no, only 10 hours, that’s it”.

And while working with you, we had such expectation, and I can say that it was entirely justified. And due to the fact that the company is small, and the management of the company is involved with the tasks and is communicating with the client, a lot of the things can be changed effectively.

So … no one is perfect, which means that everybody always has some difficulties, various approaches, but the number of initiatives on your part eventually leads to those changes and you say: “Dear colleagues, why don’t we change our way of reporting and make it such and such?” After two weeks after the way of reporting was changed you say: “What if you do certain things, you will structure them this way, write about some marketing experiments in such a way?” “Okay, will do”. Yes. So, in big companies, it won’t work. They have their framework and they work within this framework.

It has worked with you and I can say that probably the main value is the level of flexibility and desire to go further if the situation requires.

Price

I can say that as we are a product company, which works in B2B segment, the price of the service is unimportant from the point of view of the goals, which we want to reach.

I would say: “We welcome the increase of the expenses if it can effectively influence the result”. Thus, the value is paying off multiple times.

Drawbacks

I have just mentioned one of your strengths when the management of the company gets involved with the projects, communication with the clients, and I can even imagine – takes part in some hands-on processes, i.e. go to AdWords and have a look at what’s going on there and how a certain company is performing. This approach has a reverse side, which I can call a drawback, and this is the lack of systemic project management, when certain people are responsible for certain tasks, for their coordination, for their synchronization, for the consistency of some procedures, which can take, say, one month.

When it’s not the management of the company, not the top level, which definitely prioritize certain projects, which have certain tasks out of the client scope, but rather of administrative nature, I don’t know, vacation, for example, and when we speak that a company has such function as project management, organization, and coordination, in my opinion, it will help you move even faster and reduce the number of situations when you would need to say: “Let’s have a chat, sync up, let’s put together the whole picture of what’s going on here or there”.

References

I would recommend your company to those who are aiming at high transparency in their work, to those who are looking for an opportunity to, say, get a team, which would work kind of from the inside, meaning it’s not an agency, involved in other tasks, but rather people who empathize with the goals of your company.

And here is another component, which must be important for a scalable business that grows, but it worked in our case and it is worth being mentioned. We started in one scope when there were two people working on our project, but as our requirements increased, as new projects emerged, we demanded more attention on the part of your agency, and there was this important flexibility when you started engaging additional people, who, on one hand, are as qualified or even more qualified, and, on the other hand, get involved into solving tasks really quickly and we don’t have the need to spend another month working with someone else, explaining them all the aspects. You were some kind of a backend for us from the point of view of those tasks when you could have just delegated one thing, then another thing, and … there have never been any sags in quality, which remained at the same high level as during the first project. So, if your business is growing, if you understand that in a quarter or two there might be some kind of enlargement, I can say that Roman.ua agency is also ready for those challenges and is monitoring the situation when the scope should be increased and more people should be involved in the project.

Alexander Hlevnyuk, Chief Revenue Officer в iDeals
https://www.facebook.com/khlevnuk

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Paul Muzok
Co-Founder & CEO skylum.com

It’s always a pleasure to collaborate with Roman, he's hardworking and very attentive to details, always looking for best approaches to deliver the optimum result.

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