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How do I Know My Competitor 's Budget for Contextual Advertising?

Alexander Prokopiev
Alexander Prokopiev CTO of ARTJOKER
4 min read

The effectiveness of contextual advertising is determined by quite tangible indicators - the incoming traffic, the number of new orders and, accordingly, profits. To come to the "golden" balance sometimes you need to test a lot of options, to hit a few bumps, to spend a large sum of money. Not every business is ready for that: pouring the lion's share of the budget "nowhere" is not the most attractive prospect. Much more convenient to initially understand what the cost of context will be optimal and justified for your niche. The easiest way - to see the competitor's advertising budget and, given someone else's experience, to build their own strategy. Let's face it: calculating the costs in exact numbers will not work. This is confidential information, which entrepreneurs are in no hurry to make public. However, to calculate the approximate data is quite realistic.

What Will Knowing the Competitor's Costs Do for Us?

The presence in the niche of strong players who spend significant sums on contextual advertising, increases the price per click, reduces the coverage for all. In such conditions there is a great risk that you will quickly drain the budget or get a conversion at an inadequately high cost.

It will also be useful to know the contextual advertising budget of your competitor's for a number of tasks:

  • you will be able to find out in advance what is happening in your field, to avoid pointless spending;
  • understand whether it makes sense to invest in contextual advertising, or it is better to focus on SEO-promotion;
  • to understand whether you need to pay for expensive high-frequency queries, or good profits can be obtained from the low-frequency.

The information obtained will allow you to calculate the budget for the advertising campaign, to assess whether it is worth allocating additional finances or it's time to reduce and optimize spending.

What Services are Used to Estimate the Advertising Budget?

There are legitimate services for estimating competitor's advertising budgets. You can choose the most convenient one for you:

  • SEMrush;
  • Serpstat;
  • SpyFu;
  • KeywordSpy.

Services measure data in approximately the same way. They give a free trial period, but for permanent access to all the features of resources need to make a paid subscription. A separate plus is that they provide good keyword analysis tools, so you can also find the keywords that are successfully used by your "colleagues".

How to Determine the Cost of Contextual Advertising on the Keywords?

If you want to know your competitor's budget for contextual advertising for the whole niche, it is worth compiling a semantic kernel in advance and registering with one of the services for evaluation. For clarity, let's look at the whole calculation process using Serpstat as an example.

  1. Go to the platform, select tools for PPC analysis.
  2. Enter the keyword, select the region.
  3. Go to "Key phrases".
  4. Using filters, remove occurrences with toponyms.
  5. Unload the data into a document in a format you find convenient.
  6. You will receive an offloaded version with a list of keywords + their positions + number of requests + cost.
  7. Since we have no indicator CTR (determines the ratio of the number of clicks to the number of impressions), take approximate rates. On average for non-branded occurrences, located above the output, it is about 25% for 1 position, 23.7% for 2; 22.5% for 3 (figures may vary).
  8. Calculate the price of the context for the first position for all the keywords: the number of requests multiplied by the rates, and then by the approximate CTR.
  9. The platform shows the price per click in dollars, so the amount received is converted to hryvnias.

By calculating the amounts for the second and third item, you can compare the cost difference and already at this stage to optimize costs.

How to Determine the Contextual Advertising Budget for a Particular Site?

You can find your immediate "neighbors" in the niche directly on Serpstat in the corresponding menu. Based on similar search queries, domain relevance and the total number of phrases in the context, the service will generate a report with a list of sites.

In the case of calculating costs for a particular website, the scheme will be slightly different.

  • Enter the domain you are interested in.
  • Go to "PPC-analysis -> Key phrases".
  • Repeat the steps described above.

The report, among other things, indicates the level of competition for the key from 0% to 100%, which can also be taken into account when collecting the semantic core for further promotion.

Conclusions

Obviously, to understand the exact picture of a competitor's advantages in contextual promotion, the knowledge of one budget is not enough. Additionally, it is worth analyzing the targeting, keywords, ad texts, landing pages. If you care about payback contextual advertising, our experts can conduct a comprehensive analysis of competitors' websites and develop an effective marketing strategy, taking into account the nuances of your business.

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