How to configure your Google campaigns if you sell heavy items and pay large freight costs

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Hello and welcome to PPC Problem Solvers. My name is Petra Manos and I’m from the Quantified Web. Now a situation that some of my clients have run into is the fact that they sell fairly heavy items and they’re trying to ship it into rural areas of Australia. Now I’m located in Australia but if you’re in the US or somewhere else then this will most likely eagerly apply. Although please excuse me if I use the term postcodes to refer to zip codes for the US. But essentially if you’re shipping into fairly remote postcode zip codes and you sell heavy items then this can definitely be a problem for retailers because the freight costs can become a lot more expensive when it’s in fairly remote locations. So I’ve had several clients who have run into this problem because they sell quite heavy equipment. And in fact I’ve got one who I’m working with right now who’s selling quite heavy equipment indeed and so a prompted me to this video.

Now when you are when you’re shipping into remote locations what can happen is the actual freight costs can double or even triple and what can happen there is if your margins are normally somewhere between 20 and 40% but now you’re paying between 20 and 40% for your shipping then that takes all of your profit margin out and you can end up in a situation where you’re breaking even on your product sales. Now this is really dangerous if you’re also doing PPC advertising because your PPC advertising is probably also taking somewhere between 10 and 20% of your total retail price as ah a cost to Google and so if you’re spending 20% on advertising and 20% on your freight and your margins were 30% you’re actually making a 10% loss. So it’s really important to make sure that you’re focusing on ways to make more profit and one of those ways is to target locations where you know the freight cross freight costs are going to be manageable. So in our case here in Australia you certainly target all of Australia but the freight companies will be giving you a pricing on different postcode values which might also be zip code like I said if you’re in the USA.

Now Google Ads lets you define your geo targeting based on country region postcode or zip code and radius around a point. And so it’s quite easy to set it up to just ship to the entire country. And certainly this will work but then if you run into a situation like I described where you’ve got heavy inventory then it might not be profitable to sell to the entire country at once. Now if you try to break it down so that you have more than one campaign. So let’s say you have a cities campaign and a rural campaign then a couple of ways to do that. One would be in your city’s campaign you would literally just target the cities themselves. So Google Ads does give you the ability to just target the city with the greater metropolitan area. But what can cause those? You might find that outside of the city there might be some locations maybe 5020 sorry 5000200 kilometres away from the city that are still reasonable in terms of shipping rates and it’s only when you get a lot further than that that it gets more expensive So you’ll want to have a look at the data that you have from your freight carrier as to what point your freight becomes a lot more expensive and actually consider that when mapping out what these geozones are going to be. So I’ve got a client at the moment who said that his ah zones are really around two hundred kilometres from the city. So in that case what you can do is you can set your city campaign to have a radius around a point which is 200 kilometres.

Now the tricky thing is let’s say you still want to target people that are outside of that 200 kilometres zone then you need to decide how you’re actually going to do that. And one reason why that’s really tricky is Google Ads doesn’t allow you to exclude a radius from a larger amount. So let’s say you targeted all of Australia. You can’t say I want to target all of Australia. I’m going to exclude two hundred kilometres from the city. Unfortunately you can’t do that. So in fact this is a really difficult problem to solve. What we’ve ended up doing here at the Quantified Web is we’ve worked out which postcodes are within which ranges and we’ve actually set it up so that we’ll have one campaign which is targeting particular postcodes which are within a particular rate well actually will target a radius around the point like I described before and then we’ll have another campaign which is all of Australia excluding particular postcodes and those postcodes are going to be the postcodes that are within 200 kilometres around the city point for example.

Now to actually get that information requires a little bit of studying of how your postcodes are distributed in our case I actually use some geospatial software to bring that up and so we were able to get it fairly accurate but you’re never going to be able to get 100% accuracy because whenever you’re using a radius in one case you can’t exactly match the radius with postcodes. But you can get it good enough. Now another way that you might do this. Instead of trying to deal with radiuses and then excluding the radius from the total which seems like it should be easy but it turns out not to be in practice. Another way that you might handle it is to go to your carrier and download their freight rates list and sort them into high rates and low rates from your location and then create a campaign or create two different campaigns one which is high rates and one which is low rates.

That’s quite reasonable to do as well. Alright so once you’ve got that sorted out and you’ve worked out which campaign is going to be your good rates and which campaign’s going to be your low rates then the next thing to do is to set your targeting settings so that ah more of your budget is being spent in the campaign has the lower targeting rates. Ah sorry, lower freight rates. So the way that you’re going to do that is hopefully you’re using a ROS target on your campaigns. And what you’ll want to do is set the Rowes target to be really high or at least considerably higher on the campaign that’s in more expensive freight locations than the one that’s going to be your standard city users. So ah for example if you have the city users campaign let’s say you have your target Roas set to no hundred you might want to set it to 1500 or 1800, which is double on your remote people’s ah campaign. And what that’ll do is it’s telling Google that hey for this campaign which is mainly rural people I don’t want to spend more because ah a larger percentage of my ah profit is going to be disappearing into freight so I need a much larger return on ad spend in order to be happy with the results that I’m getting in this campaign. That’s how you tell Google that. At. Well hopefully that’s helped out.

That’s given you an idea in terms of how to make a bit more profit from your account when you have expensive freight costs. Certainly don’t expect Google to work this out for you if you just have one geozone. Google will just assume that the freight is equal for everybody in there and will probably target whoever appears to be the best prospect at the time. They’re not really going to look at the geozone and of that when picking which people to show the ads to. Alrighty. Well if you have any other questions about this feel free to pop it in the questions below. Certainly subscribe to our channel if you want some more in-depth answers with regards to Google Ads questions and tips and feel free to reach out to us. We’re at the Quantified Web and we’d love to hear from you. Have a wonderful day.

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