Are Google Ads Still Worth It?, AI for Paid Ads, and Paying for Coaches Doesn't Make Sense (Reactions)

Published Jan 11, 2024, 12:00 PM

In episode #2655, we discuss the effectiveness of Google Ads and the value of business coaches. We break down the data on Google Ads, including click-through rates, conversion rates, and revenue generated. We also compare the return on ad spend for various social networks. When it comes to business coaches, we approach it with a skeptical perspective, particularly towards those primarily focused on making money, as Neil expresses. On the other hand, we share Eric's positive experience with a coach who has truly been there and done that. Tune in to learn more about the profitability of Google Ads and the pros and cons of business coaching.

 

Don’t forget to help us grow by subscribing and liking on YouTube!

 

Check out more of Eric’s content (Leveling UP YT) and Neil’s videos (Neil Patel YT

 

TIME-STAMPED SHOW NOTES:

  • (00:00) Today’s topic: Are Google Ads Still Worth It?, AI for Paid Ads, and Paying for Coaches Doesn't Make Sense (Reactions)
  • (00:40) Average click-through rate, cost per click, and conversion rate for Google Ads
  • (01:13) Comparison of conversion rates for SEO and paid advertising
  • (01:42) Percentage of users who know they are clicking on a paid ad
  • (02:16) Average revenue generated for every dollar spent on Google Ads
  • (03:30) Revenue numbers and return on ad spend for different social networks
  • (05:57) Reasons why Google Ads is still more effective than other social platforms
  • (06:41) Discussion on the role of AI in advertising and the importance of human intervention
  • (07:37) Debate on the effectiveness of business coaches
  • (09:03) Differentiating between specific expertise and general business coaching
  • (10:46) Summary of the types of coaches to avoid and the value of experience in coaching
  • (11:18) Personal experience with business coaches
  • (12:23) Neil Patel questions the role of a business coach
  • (15:36) Eric Siu emphasizes the importance of working with experienced coaches
  • (16:23) That’s it for today! Don’t forget to rate, review, and subscribe!

 

Go to https://www.marketingschool.io to learn more!

 

Leave Some Feedback:


  • What should we talk about next? Please let us know in the comments below
  • Did you enjoy this episode? If so, please leave a short review.

 

Connect with Us: 

 

Today we're going to be talking about how effective Google ads really are. So this was interesting for me because I ended up breaking down just Google ads in general, and I'm like, all right, what's the data? How profitable is it really? What are people doing? And what are click the rates and all this kind of stuff. So let me actually share my screens that can break down the data. In our company, MP Digital, we have some tools. We tracked roughly two point one billion dollars USD a year in ad spend, and the average Google click THEUGH rate right now is three point two two percent, average cost cover click two dollars in eighty one cents, the average conversion rate three point four to nine percent. And on the flip side, when you look at organic visitors SEO traffic, it's converting less than one percent. But you don't really have to spend too much money on SEO in comparison. Yes, you can do it time wise, or you know, through people on your staff, or you may pay an agency, but in comparison to how much paid advertising costs, it is much cheaper. But the conversion rates for SEO are much lower sixty eight nine percent. And this one shocked me. Of the users know they're clicking on a paid ad, and the part that shocked me is roughly thirty one thirty one percent and change or thirty two percent, however you want to look at it. They don't know that they're clicking on a paid ad, but the people that are know that they're clicking on a paid ad. They do it because they believe that the query that they're clicking, the result that they're clicking on will provide the answer to the query they typed in, and that makes sense why they're clicking on it. The average advertisers generating six dollars and twenty six cents in revenue for every dollar they spent. Now that doesn't mean that it's profitable, because they may have other expenses in there, but that's just the data that we're able to track and to sum it all up, generates two hundred and twenty four billion dollars a year in ad revenue. People talk a lot of crap on paid ads, but if it didn't work, they wouldn't have ended up generating anywhere near that much revenue in paid ads. Now here's the funny thing. When you think about paid ad revenue, A lot of companies say, oh, we can't make it work. But if Google's generating that much revenue, how is it that it doesn't work. It's not that it doesn't work for you. I mean, it's not that it doesn't work, it's it doesn't work for you. Your competition is still spending money. And the chances are the reason it's not working for you is because your funnel. You don't have upsells, you don't have down cells. You haven't figured out how to get people back and buy from you over time. You haven't figured out how to increase the lifetime value of your customer. That's the real key to make paid ads work. But check this out. I just broke down Google ads, right, And what I want to do is actually look at some of the other social networks you're using the wrong you are using. I have it somewhere here on row as where is it. I know we've ended up breaking down this in the past. I wish I put the link in this before you are using the wrong er Neil, there you go. I found it all right, So check this out with the other social networks that you guys can compare it to Google ads. So as you can see here and this was from the last thirty days at least when I put out this tweet, which one was this? This is December six, twenty twenty three, so thirty days pretty much from November to December. When we were looking at the social networks, we were looking at a lot of companies analytics. We have data to over a million sites and we were breaking down which one has the highest row ass. But before I break down which one has the highest rows which is return on ad spend, let's first look at the revenue numbers from each social network, right, and not just other marketing channels, but only social networks. So when we're looking at the data and analytics, we were seeing that when you look at social networks, Facebook drove thirty two point three seven percent of a website's revenue. YouTube was at twenty eight point one nine percent, LinkedIn was at eleven point four seven percent, Instagram was at ten point nine two percent, TikTok was at eight point four to four percent, x was at four point four one percent, Snap was at three point one eight percent, Pinterest was at one point two percent. There were other social networks like Reddit and some really tiny ones. We ignore them because it was so insignificant. Now When we looked at which ones had the highest row ads, which is returned on ad spend, X was six point eight percent. Pinterest was five point I mean not percent. X was six point eight, Pinterest was five point two. Snap was four point nine, TikTok four point one, YouTube three point nine, Instagram three point three, Facebook three point two, LinkedIn two point six. X produce the highest row ads. Now, just because someone produced the highest row ads doesn't mean you can get the most volume there. That's why you're seeing networks like Facebook and YouTube driving the most revenue volume. But what we're seeing is companies are going to start spending more time on platforms like X and Pinterest and Snap where the rus is amazing. It doesn't mean they're gonna neglect you know, places like you know YouTube, I mean YouTube or Facebook because the ruws isn't as high, because they're still getting volume. And the ideal thing to do is you leverage Google ads, Facebook Ads, Instagram X all channels that are pretty much profitable. But the funny enough, when I was showcasing Google first and then I did the other social platforms, Google still crushes most of these social platforms. Why because someone's typing in a key word by affordable laptop, I want a red bike. Whatever the query is that they're typing in, you can show an AD that's directly related to the search Cray, which is why it's one of the best platforms out there for advertising.

As long as there's attention, there will be demand, and that's marketing one on one. And what I would say to this also is when you think about people talk about performance Max, people talk about advantage plus from Meta. These are the new kind of AI pushes from Meta and Google. I think we're going to get to a place where those are going to get a lot better. Right now, there's still a lot of human intervention that's required. I think there's always going to need to be a human in a loop to just make sure that things are working well. But I think, going back to Neil's point start when he started us off, it was more so like when people complain that it doesn't work, it's because they suck. Like straight up, it's like they don't spend enough time on marketing. And there's only two things that matter when it comes to business. One how are you acquiring customers? And then two how are you serving those customers? And most people. Most people think, oh, sometimes it's like, oh, the product's enough. No, that's not enough. You got to think about how you acquire customers too, And that's what we're talking about here. And just because AI stuff's coming out, doesn't mean you could just rely on that completely, right, Like, you actually have to be very thoughtful about it, and marketing should be something that's top of mind for you for at least one of the founders of the business.

Yeah, and with this being a new year, I know we're in twenty twenty four at this point. Another thing that Eric and I wanted to talk about is business coaches. I know we have very polarizing views on this. Eric is about business coaches. I think you pay quite a few of them, or are you used to?

And I'm pro coaching, That's what I'll say.

You're pro coaching. I'm very against most coaches. And here's why. When you find people online that are like, I'm a coach, they're a coach because they're running Facebook ads and they've made their money by saying I'm a coach. Dude. I met someone the other who claims they make millions of dollars a month from coaching, and it's pretty much pure profit and they're known for having you know, a handful of rolls, Royces and Ferraris and fancy cars like that. I'm like, what'd you do? Oh, you said you're a coach and you're charging people and they're going to be successful by paying you because you have flashy cars and homes and stuff that you got from just running ads and telling people you're successful. Like what did you actually really do? And this is why I don't like most business coaches. I think most of them are shams and this bunch of bull. And Eric's paid coaches that have like, oh we sold our agency to this place and all that kind of stuff. I'm like, well, Eric's bond agencies and some haven't worked out and he's learned from it. But I'm like, where's your coaches where they save you? They charge you the money and most of these coaches make their money by charging you, And that's why I think it's just a bunch of bull. But if you want to pay a coach for something specific, like I'm really good at M and A and look at all these deals I've done and I will help you with just that, right, or I've done sales within your industry, not sales in general, because a lot of these people pitch the dream and that doesn't work for all industries like mine. Everyone's like, cool, what's the case studies and what's proof that you can actually provide us a ROI with our marketing budget of one hundred million dollars a year, using some fancy sales skills that they learn from watching some of these videos, isn't going to help them close one of those deals, right? But if you want to pay someone for something very specific, like I need help with operations, I'm a terrible manager and I don't I'm not organized and I need some systems or procedures, Or if I need help with M and A and you've done tons of M and A in similar fields are my fields and I need help from you. I think paying those kind of people that's fine. I think just paying general business coaches is just a waste of money because what are they going to end up teaching you? What are they expert in charging you money? Because they're successful by charging other people on how to be a coach and how to sell the same thing to others.

So here's what I'll say, So I see, I know where Neil's coming from because Neil and I talk all the time. Neil got ripped pretty hard on that thread, and I understand why people ripped him because they also don't understand where he's coming from as well. So the premise of it basically is correct. So basically I'll reframe it for people, and this might help cover all the sides here. Coaches that are really good at marketing, that show off their Lamborghinis and show off like, you know, their their nice lifestyle, those are not the people that you want to be working with at the end of the day because out of the gate, when you're showing that stuff, it just like there's a misalignment, Like it shows that you're not humble that the first and foremost, and it shows that you're also shallow for thinking that people, like really smart people are gonna fall for that stuff, just even they're gonna be impressed by your Lamborghini and like you're you're really nice lifestyle. No, like they want to learn, right, So that that's really the premise of where Neil's coming from on those coaches, right, and not just one of the things. Let me finish, I let you monologue for five minutes.

Let me, let me finish shit.

So what I would say is with the coach that the coaches that I've had in the past, the ones that have worked that well, have been there, done that, right. So the coach I work with right now is Jerry Coloonna, and you know, he's been a VC, He's worked with Fred Wilson, He's worked with you know, the CEO of Twilio at SI. Like, the guy has a lot of range. He's a father like, he can talk about business and everything right, and he also doesn't need the money too write, so he's like he doesn't show anything off.

He's a very humble guy.

He's very like grounded, and he also doesn't tell me what to do for the most part. He's just asked me really good questions, right, And that shows that he's like coached up there. So it's like has he been there, done that? Like, Yes, he's done a lot of different things. Has he like coached legit people, yes, right, And so to me, he's worked out. To Neil's point, the agency coaches that I worked with, I didn't realize. This is my fault, by the way, Neil's absolutely right about this. I didn't realize until a couple months working with them, I was like, oh shit, they only had an exit for two million dollars?

What am I doing here? Like?

Because they came recommended from someone else and I didn't do my due diligence and I realized that the things that are telling me the questions, I was just like, dude, these guys haven't been there, done that. What am I doing? And the advice was really bad and I'm just like at that point, I think it was three four months in, I was like, hey, guys, like I'm out, Like, thank you, but I'm out, So there's nuances to it. Go ahead, Neil, but you.

Pay a coach. He asked you questions, how's that coaching? That sounds like more like therapy A good coach. So a good coach, most of the time they're guiding you.

They're not supposed to tell you what to do, right, A mentor or an advisor don't tell you what to do because that's like advice. But to me, I've learned over the years, I used to think a coach is supposed to tell you what to do, but like this type of coach, like a business coach, executive coach. I'm looking for someone that asked me the right questions to get me to think through things.

So they're just helping you retrain how you think.

Yeah, in some cases you'll be like, dude, what the fuck stop being an idiot? Like that will happen as well. Sometimes they'll just tell me, like, dude, you're being stupid.

So yeah, because I think of like a business coach like a basketball coach. Right, they'll tell you what to do, they help you the train.

It's just different definitions. That's what you got called out on right on one of them. It's like different definitions. But I think like the premise of what you're saying is is right. I just think most people don't.

They haven't.

Most people aren't going to like dive into it. You know.

My funniest was I was on stage Eric speaking about the Lamborghini. Someone told me how they have five rolls rooices but they don't own a home, and they're like, buying a home is a waste of money. I'm like, buying five rolls Roycees is a waste of money. You could have bought a home. Your roll's voices are going to appreciate over time. Like what are you talking about? Yeah, you know, and I'm not saying buying a home is a good investment for some people like Eric and I, we would make more money by renting a home and taking the capital and just businesses, yeah, putting it back in our businesses. But that's not everyone. A lot of people have made their net worth and their money in life, you know, by just buying a house. Like our parents' generation. A lot of them are millionaires because they bought a home back in the day for pennies on the dollar. They didn't have to do any investing. They paid it off and it's now worth millions of dollars in places like California and York or wherever it may be. But the problem I have with most coaches, you know, like even the one you're talking about and that use he's probably great, you know, I don't know why he would go from being a VC and getting the two and twenty to being a coach, you know, being a vast. I asked him this.

I didn't call him out, but I asked him this. I was like, so why because he's made his money already, and like the coaching thing, He's like, I don't, look, I don't need to do I just have a lot of fun doing that.

And here's the thing.

The coaching business as a whole, it does thirteen fourteen million dollars a year. He's he doesn't need to be one of the coaches, but he's one of the coaches. Even though he's one of the co founders. He just enjoys it and I can tell he likes doing it. He's not money driven.

But then if he's not money driven, then why charge for coaching and why build a team? Why not just do it himself and just help people?

Well, because he believes that, like still like, if you're going to do something, the best way is still for profit.

Yeah, I'm with that. There you go at that point, might as well just be a VC and then make the money. Well that VCS. So typically VC's on your board.

They're like they might tell you what to do, but they're not like it's not a coaching It's a little different because for example, he coaches the Twilio the Etsy's guys, right, Like they have their board, they have their VCS as well, but they still they still want a guy like him.

He coaches like Jack Dorsey specifically. Yeah, I mean you think back to Bill Campbell, Like sorry, Twilio is not Jack Dorsey. I forgot who Jeff Lawson. There you go, Jeff Lawson. Yeah, yeah, So so he pretty much coaches Jeff Lawson and.

Correct And it's a lot of I mean, you and I both know, like everyone here, like entrepreneurships a lot of ups and downs, right, and there's a lot of stuff that you have to fight through.

So it just depends.

But I think what we're really saying here at the end of the day with coaches is like, you don't you want to work with humble, hungry, smart coaches and you want to work with people that have been there, done that. And look if someone's like a twenty year old life coach, like, what are they coaching you on?

So they're probably aren't twenty year old life coaches, but no, and then even if they're in your space, it doesn't mean they're successful. Eric gave a prime example of the agency people. What do people know who really sold their agency for a few million dollars? If they were really good, they would have helped Eric may avoid a lot of the mistakes. It's like, what, Eric's built a bigger agency than them, and they're coaching him on how to actually make his agency bigger when they've never done it.

YEP, doesn't make sense anyway, so take that for what it is. That's it for today's episode. Please don't forget to rate views, side mute, rate raview, and subscribe. Check out this next video over here, and we'll see you tomorrow, dude,