Free Money from Google & What To Do With It
I’m Ryan Garrow, the Director of Partnerships and Client Solutions at Logical Position. We're a performance-driven digital agency that focuses on all kinds of clients across all metrics and all sizes and shapes, for all businesses. We have been around since 2009 and have just over 6,300 clients (3,100 of them are eCommerce, so we're about 50-50). E-commerce is probably the fastest-growing segment. We've got about 650 employees and we have about 9 offices, 10 soon. Obviously, we're all remote currently, so none of our offices have people, but we are always growing and expanding that reach and trying to help as many businesses as possible.
- All things Google Ads & free ad credits for SMBs
Who’s eligible for the free money for Google Ads?
SMBs, globally qualify for Google's free Ads credit. It's not just tied to the United States, it's global businesses. There's no actual definition to what an SMB is, which is an interesting play because SMB can be considered quite a few things, depending on the size of the business. SMBs in certain metrics can be a hundred million dollars or less. Google doesn't necessarily know your revenue though, so they can't quantify your business based on how much money you make or don't. Some businesses are very large. We have billion-dollar businesses that have, before we start work with them, were only spending a thousand dollars a month on Google, and so Google would have considered them a small business generally speaking, but they were doing over a billion dollars a year.
Employee count, Google doesn't know that as well, so they can't qualify you based on the size of your business. Some of that PPP money that's been coming out under 500 employees, Google doesn't know that either. Most likely, Google's going to have to rely on the one metric they pay attention to most, just how much you're spending. A decade of working with Google very closely in one of their top agencies globally, we believe this is going to be people that spend under 5,000 a month. That's not a for sure thing, so you don't quote me saying, "Ryan said this is going to be 5,000 or less a month."
Based on the guidelines that Google's put out and what they've done in the past, we can be pretty confident it's going to be in that range. They may move it because that's one reason that they keep it somewhat nebulous when they release this data that because then, they can continue to refine it and actually see where it's going to make sense. Because they've allocated, I believe, 340 billion, and they're going to want to make sure that they're giving that to the right companies and the right amount of it so that obviously, they're not going to overextend it.
This is from Google, "We work with SMBs worldwide, from local stores to companies with hundreds of employees in many locations." For Google's definition of SMB from the actual press release is, local stores to companies with hundreds of employees and locations. I'm going to assume most companies spending less than five grand a month, they're going to be considered an SMB. I would say that number could go up or down, but I'm comfortable saying five grand in monthly ad spend.
There are some additional requirements. If you've read the press release, you've been in and out of some of those details. If you just bookmark that blog post, they are regularly updating the details of that. You have to have spent money in Google for 10 of 12 months of 2019. If you turn off for a season, you may only get 9 of those 12 months. That may not be a great idea. And you have to have spent money both in January and February. It doesn't say how much you had to spend each month. If you spent $5,000 a month in 2019 for every month and then you only spent $10 a month in January and February, that may work. It just said you had to have spent the money.
Adherence to Google Ad policies
You have to adhere to the policies of Google. This means you can't be selling things on your site that are illegal now. If you all of a sudden decided to jump into the CBD space and you weren't there last month because there was an opportunity for you to get in there and start selling some additional products, you're not adhering to Google policies anymore and they will probably not allow you to spend that money. CBD, gun parts, aggressive knives, things like that. You have to basically read the policies on what they do and do not allow, and then make sure you're still following those. If you have been for the past year, I would generally say you're probably all right. Just don't make any big changes before the money actually hits your account.
When will you receive your ad credits? How much?
Again, we know the total amount and there's also some ambiguity about when it actually will hit your account and how it's actually going to be put in there.
Late May is when people can begin to expect ad credits entering their accounts. What quantifies in Google world as late May? Hard to say. We just know that that's when it's going to start hitting accounts in late May, and it could be a gradually rolling thing. Google probably, knowing them and having some experience with them for quite a few years, I don't expect them to release a giant pool of free money all at once because that's going to throw a lot of equilibrium out of the system. You'll have a lot, $340 million all of a sudden hits Google ads in a one-week period. Click costs could go through the roof and companies that have been spending a lot of money for a while, just the return is going to go crazy.
Google is probably going to do a pretty steady release of this throughout the year. They may even have some data around when you may need the money more than other times. If you do generally spend less in June than you do in August, maybe they're going to have some day that's going to allow you to get the money in August when you might want it more, rather than using it up in June or July.
How will I receive this free money?
You're going to get it as an ad credit so there's no cash, there's no check coming from Google to say, "Yay, you're a small business and we want to give you money to help you with anything else you want beyond Google." It's specifically saying, "Hey, we'd like to help you spend on Google to grow your business and make sure you have the ability to push when it's appropriate or spend it as is appropriate."
So, $340 million. We know that Google has told us there's about 2 million SMBs advertising in the U.S. and there's more globally, and this is a global program, not just in the U.S. So, not all 2 million-plus global are going to qualify based on the requirements. You have to spend 10 of 12 months and you've got to be spending both in January and February. If you turned off in March and April, you're okay. We estimate 125 to $150 per account. That number is probably not going to make anybody's wonderful day and say, "Oh, my gosh, I'm so excited to get $150 in ad credits from Google." There are some things you can do with that and some strategies that we would probably advocate to use this most effectively and what can you be doing based on your situation?
How to use your ad credits most effectively
Most people would have loved to see, if they saw the number of 340 million, it's like, "Oh, my gosh, I'm going to get a few thousand dollars from Google to spend. This is going to be so great." Not as exciting as many people initially thought. And then they're still, they may eliminate half of the businesses that they thought they originally were going to put into that program. Everybody gets 300, so there's no fine line yet to say exactly who was going to get this money.
When I look at businesses, I look at them in basically two buckets:
- Lead generation
That's oversimplification because there's a lot of companies that are both. When I'm looking at the strategies for the money, I'm going to go in just two buckets, to keep it simple and make sure we can get some high level, and get to some of your questions.
Test a new product to campaign
If you've got a new campaign going or you want to try a new type of ad, you've got $10 a day for roughly two weeks. That's a decent enough number for a lot of business in this SMB space to probably get some idea. Does this make sense? So, if there's something you really wanted to do or you wanted to release a new product that hasn't been out before, now you've got an opportunity to put some ad dollars behind it, at very little risk.
You can keep costs low, you can sort of time of day, you can do region-setting to test it. If you're an eCommerce business that has more of a local presence, and you want to take care of the people around you because you have a special product that you think they would like, you can set a geographic target and cover a lot of that area with $10 a day in Google shopping. Maybe a tech stack can make sense. Again, testing a new product or a campaign, a lot of SMBs that come work with us have not done much in the scheme of display prospecting on Google.
Prospect on display
Google's got a pretty powerful display network. They've got a lot of pretty creepy data. It's very useful from a marketing perspective, and I may not tell my mom all the things that Google tracks on our computer, but from a marketing perspective, it's really awesome, and you can do a lot of really cool things as a marketer online.
What a lot of companies don't realize is there are these in-market segments set up in Google already. And so, if your business, your product or service falls into one of those buckets, Google knows this person's in the market for that.
For example, if you sell mattresses and you have a local spillover, but now you're starting to sell them online and do delivery around the area, because people that need a mattress right now, Google has a segment that says, "Hey, this person is in the market for a mattress within the next," generally it's about two weeks, but it extends based on the product. There's some for automobiles as well. You can put an ad in front of those people out on the airwaves. "Hey, I have the best mattress, I have the one you want." You can bid on those people differently as they start to search as well.
There’s cool options for prospecting of people that maybe don't know who you are. It's something that, in the past, the return on it has made it not something you would have done yet. But with free money from Google, it's worth possibly testing.
From an eCommerce perspective, feeds can always be improved. This isn't necessarily something that the Google money would be able to pay for, but if you found somebody that could optimize and test titles for you, maybe you take some of your money and pay them a little bit of money and spend the same amount. If that person was going to cost you a hundred dollars, keep your ad budget, maybe only bump at $50, use that hundred dollars to pay them to improve your fee.
With eCommerce, we know that Google shopping just began to have some organic releases. If you have been around as long as I have in the Google space, you've heard of frugal. That's basically what we're going back to. It's kind of like we're coming back to the past of where Google shopping used to be, when all of us old marketers were like, "Oh my gosh, clicks are free in shopping. This is so great." Yes, there are free shopping clicks. It's probably going to have to do with the quality of feed because you have to have a Merchant Center account, which generally means you've spent money on Google ads in the past, and you have to be submitting and regularly updating that, even if you're not spending money on Google ads and you're just trying to get organic.
I can't not do a presentation on Google, especially for eCommerce and not talk about increasing the aggression in your account. Most SMBs are timid, compared to a lot of their bigger competitors. This is not necessarily a bad thing, but a lot of times, they're looking at the data incorrectly, and they look at their Google ad spend as a P&L line item, and that is not the best way to look at Google ads. Google ads is one of the most phenomenal marketing opportunities in a downturn we've ever had. In the last downturn, we did not have Google shopping. We didn't have it. You couldn't pay money for clicks in 2006 to 2008, didn't exist yet. Now, you have it. You have the opportunity to buy a customer through Google shopping and you will get the revenue quicker than you will actually probably pay Google, which is a phenomenal thing.
I could say if I spent a hundred dollars today and it generates $500 in revenue, that hundred dollars probably goes on a credit card. Even if it goes on a debit card, Google bills every $500, so let's even say it went on the debit card, my merchant processor account will probably put that money in my account within 48 hours. If I spend a hundred a day, I've not actually hit my debit card for five days. That money's in my account before I've even paid for the clicks, technically. Look at it as, you acquiring a customer, and don't look at Google ads necessarily in a time like this as a profit center. Look at it as a customer acquisition center.
See credit as a discount on an expert
Some people, I'm recommending, actually look at an expert. And so, if you're doing all the work yourself, in a time like this, having an expert do some of the work for you can make things better. Not always, but many times, it can. Maybe getting an expert to work on your Google ads is going to cost you 500 bucks. Look at that $150 as possibly a discount on that. It's only going to cost you 350 bucks this month, get that done. I think there's a lot of opportunity to push and pull levers, and especially if you're looking at smart shopping, I think there's a place for smart shopping, but I think there's a lot more opportunities in the eCommerce space. If you are moving away from smart shopping, you just get more leverage to push and pull and return and spend goal. That's something I would consider if I was an eCommerce business, which I am.
This is either you're selling stuff online or you're trying to capture leads for your business: phone calls, lead forms, etc. Mortgage companies, right now, are doing a lot of business because refinance rates are so high. Anybody that bought a house within the last two years can save money probably, even though rates aren't as low as they probably will be in the next month or two.
Test the new campaign
Again, that's going to be pretty consistent, like use this money to test something you wouldn't normally have done before. I also think you can test prospecting on the display network. There's a lot of opportunity there to use some of these in-market segments. There is an in-market segment for people looking to buy a house, people looking to refinance, people looking for a HELOC, people looking for auto loans. I talked to some credit unions yesterday. They were looking to get aggressive in acquiring new customers, and they wanted to have a good program. They're looking at auto refinances saying, "Hey, people that have bought a car in the last couple of years can probably save money on their rates." Maybe they can pull a little equity out of that car if they don't have a loan. It gets them access. If you don't have a home to pull money out of, a lot of times, you can pull money out of a car. That's some of the things they can use on the display network that maybe they wouldn't have thought about in the past.
Prospect on Display
If you're closed, some awareness could be beneficial. We had some clients that have paused, some of them were escape rooms. If you have an escape room or a network of escape rooms that you own, people are not going to escape rooms right now. Google ads is not going to save you through that. You can't do much to drive revenue from your escape rooms.
You can sell gift cards, you can do certain things like that. Maybe it's more of an awareness play. Maybe you want to fill an email database for promotions when we do come unlocked. Say, "Hey, we send a puzzle a day to help keep your brain active in quarantine." And that's what people who like escape rooms, they like solving puzzles. Maybe they're going to like that. Filling an email database, there's ads on Google you can spend to collect emails. That can be a good one, if you haven't tried that before.
Test new ad types
There's so many different ad types in Google and new extensions. Focus on these two:
- Click to Call
- Gmail retargeting
Click to Call
Click-to-call is one I really like. Click to Call can work really well on mobile, especially if you have some emergencies. We had a pipe break under our driveway last week, so we had to Click to Call a plumber that came out and fixed the leak, and Google got the click and he got the business.
If you haven't been retargeting and remarketing to the people coming to your site and not taking action, Gmail retargeting has worked really, really well. It works well for longer sales cycles too. I like moving people through different messaging. Day one may have this message on remarketing. Day three, I might change the message out if they didn't come through and become a lead for me. Day seven, maybe another one. And day 30 and so on. We do that in eCommerce as well, but it's more pronounced on a long sales cycle for a company that's trying to drive leads through that process.
Invest in tracking
If you are not tracking phone calls, you should be doing that. If you need to move some of the Google money to track the leads to be able to spend more later, you should for sure do that, through that process. At the end of the day, it's being creative. This is the time where I really do enjoy working in the digital space, but I also enjoy just seeing the innovation coming about in America. This is where you really become proud of being an American, seeing how people pivot. There's just going to be so much testing and measuring going on with every business and how you're going to pivot.
1. Do you feel like people are getting more for their dollar based on the amount of folks that have pulled out of the market right now?
For sure. I mean, I have been preaching that companies need to not pull back on marketing. This is the time where you're going to get aggressive. I actually was speaking last year at a bunch of conferences on what to do in a downturn? Because we know it's coming. I didn't think it was going to happen this way, but all of the studies through the last hundred years, we've had 18 recessions in the last hundred years. Every time when you spend money through a recession or a downturn, you're in way better shape than somebody who doesn't, whether you're lead gen or not.
ECommerce is obviously a new one in this time period because of the growth of eComm. But click costs are way down. Even in jewelry, we've had some record-breaking weeks at a jeweler in the middle of the U.S. It's just online right now. Obviously, clothes, they've broken records for sales online right now. Click costs are down 25, 30%. It's just the competition stepping away is causing them to have some opportunities to capitalize.
2. Do you think that Microsoft advertising will follow Google and have similar offers? Do you know of any other advertising platforms that are offering quote-unquote free money?
Facebook has said they're going to release a hundred million. Yelp has said they're going to give out some money to advertisers there. I assume Microsoft is going to follow, but I haven't actually heard the number or when it's actually coming, but I think part of their whole back is they got hit in Seattle pretty hard. Their whole team's there, so they were locked down pretty early on, so it's probably limited their ability to move as quickly as some of the companies that were in the San Francisco area that didn't lock down as quickly.
3. If an account meets the qualifications lists, how likely do you think that these privately owned dealerships will qualify for these credits? How can we reassure our clients that we are doing everything we can as we wait for a determination from Google?
Dealerships generally have high topline numbers and they can employ a lot of the people. A lot of cities may not consider them an SMB. Google is going to look at their spend. If they're spending 50, 60 grand a month advertising through the Google platform, Google is probably not going to see them as an SMB. If they're spending 5,000-ish, there's a good chance, but there's really, there's no approval process. It's 100% Google saying, "Here's the money" and it shows up.
We're one of Google's top agencies on the planet and our Google team's like, "Yeah, it's just going to show up. You can't call me and say this CID should get Google credit. We're not going to listen." All of Google is working from home and so, their approval process, even on just some of the stuff we're pushing through the system right now, it's taking much longer than normal.
To help them feel comfortable, I would say you're going to be testing, looking at other opportunities to grow the brand. A lot of dealerships, in our area at least, are still doing service and they're doing pickup. They've emailed me, they'll come pick up the car. Auto parts, there's a new company that I've been working with. We're looking at actually making an investment in them, but they actually help parts dealers around the country sell their inventory that's not turning. There's opportunity, I think, for just park managers to put some of their inventory up to say, "Hey, at least we're going to turn parts." Because a lot of people are working on their cars at home. I mean, my Instagram feed's full of a lot of our employees working on their car projects right now with their free time in the evenings because they can't go anywhere.
4. It seems that I've maxed out on Google shopping and prospecting hasn't worked in the past. Is there a way for an eCommerce company to push harder in that scenario without just wasting the money from Google?
I challenged most companies to look a little deeper when they tell me that they've maxed out and they're looking to do some display ads because shopping, if you look at your impression share in shopping, it's not a hard fast number in Google shopping. If you bid up on your products in Google shopping, you will actually be eligible for more searches. Your impression share could actually go down as you spend more if you bid up. I think there are some additional levers. It's very rare. We have clients that spend millions a month, and some clients only spend a thousand a month, but even the ones spending a million a month have a lot of opportunity to continue to push the needle and get more aggressive.
Some of that can just be looking at the titles. Even if you're a smaller business and you don't have a feed optimization that you pay for every month, you can just adjust titles and say, "All right, I've been selling T-shirts and I had my brand first. But I'm not a well-known brand, so maybe I need to have the color T-shirt first. It needs to be a red T-shirt rather than my brand that people don't know yet." Red T-shirt because they truncate. I have a difficult time believing somebody's maxed out on shopping.
5. Are you seeing better or worse results in shopping since COVID?
Generally better. There's some shipping times that have caused some issues with some merchants and that's beyond necessarily the ad's or Google's control. However, people are buying a lot more online. If you've seen some of the Walmart articles, if you sell pants, maybe you're doing worse. But if you sell tops, since everybody, you can only see from here down, there's little bit of variances like that.
But as a whole, we're seeing volume increase. We have a client that sells standing desks. Their problem is fulfillment. They were way up with all of their inventory and they just, their sales were up 250% in March over what they predicted. They were predicting, I think, 40% growth year over year. There's still a lot. Home office plants right now, there are so many women with plant babies right now spending money on plants.
I think just most people need to take a step forward and get aggressive and not be timid. It's not the time to be timid. It's the time to just get out there and learn. Know you're going to make some mistakes. I make mistakes constantly in businesses, but because I look at data, I can pivot quickly and figure it out. A lot of companies that I talk to, they're trying to get it exactly right before they go. And I'm, "Just go, and you're going to..." Because something, once you're in motion in spending money to acquire customers, you can direct that much easier because the plan you come up with is not going to be perfect. I don't care how long you spent doing it. I've been in it for a decade and I make stupid mistakes. My team and I come back to it. We're like, "Why did we do that?" Like, "I don't know. Well, let's pivot and do this." So, just go.
Agency Expert Q&A Schedule:
- Session 1: Helping Brick-and-Mortar Businesses Temporarily Pivot To E-Commerce | Tony Lael
- Session 2: Managing Through The Crisis: Facebook Ads Strategies for Turbulent Times | Noah Freeman
- Session 3: Free Money from Google & What To Do With It | Ryan Garrow
- Session 4: How Agencies Can Build Additional Revenue Streams | Alex Glenn