Are Google Ads Right for Your Insurance Agency? Learn How to Know

Google makes it easy for your insurance agency to get started on a Google Ad campaign and they toss $100 coupons around like so much confetti. Launching a Google Ad campaign is easy. Launching a Google Ad campaign that generates not just good ROI, but better ROI than other campaigns you can spend money on, requires a little more thought and planning.

Let’s start with a quick review of how to calculate ROI.

Return on investment (ROI) is a measure of how much money you make from your advertising campaigns - not clicks, impressions, or some other upstream metric. ROI is calculated by dividing the total revenue generated by your ads by the total cost of your ads.

To calculate ROI for a Google Ad for insurance, you'll need to track the following metrics:

• Total revenue: This is the total amount of money you make from your insurance sales.
• Total cost of ads: This is the total amount of money you spend on your Google Ads campaigns.

Once you have these metrics, you can calculate your ROI using the following formula:

For example, let's say you spend $1,000 on Google Ads and generate $2,000 in revenue. Your ROI would be 100%, which means you made twice as much money as you spent on your ads.

KPIs for Positive ROI

There are a few key performance indicators (KPIs) that you need to meet in order to get a positive ROI on your Google Ads for insurance. These KPIs include:

• Click-through rate (CTR): This is the percentage of people who see your ad and click on it. A good CTR for insurance ads is between 2% and 5%. Keep an eye on this. This is going to be significantly influenced by the quality of your ad copy (text) and how compelling it is to your audience.
• Conversion rate: This is the percentage of people who click on your ad and take the desired action, such as signing up for a quote or making a purchase. A good conversion rate for insurance ads is between 2% and 5%. A good landing page, which should be an extension of your ad copy, including a convincing value proposition and obvious call to action, will make the difference for this KPI.
• Cost per acquisition (CPA): This is the average amount of money you spend to acquire a new customer. A good CPA for insurance ads is between $50 and $100.

If you can meet these KPIs, you'll be well on your way to getting a positive ROI on your Google Ads for insurance.

Tips for Improving Your ROI

There are a few things you can do to improve your ROI on your Google Ads for insurance. These tips include:

• Target the right audience: Make sure your ads are targeting the right people who are likely to be interested in your insurance products.
• Write effective ad copy: Your ad copy should be clear, concise, and persuasive. It should also be relevant to the keywords you're targeting.
• Use negative keywords: Negative keywords are words or phrases that you don't want your ads to show up for. This can help you to improve your click-through rate and conversion rate.
• Track your results: It's important to track your results so that you can see what's working and what's not. This will help you to make changes to your campaigns as needed.
• Include social proof: Including a video testimonial or a reference to your insurance agency’s five star reviews on Google will improve landing page conversions. (Studies have show that video testimonials increased landing page conversions from 34% to 80%)

By following these tips, you can improve your ROI on your Google Ads for insurance, get more leads and sales, and make your Google Ads campaign a true marketing investment instead of just another cost.