In the ever-evolving landscape of digital advertising, one of the key performance indicators that often garners attention is the Cost Per Click (CPC). Businesses and advertisers frequently monitor CPC as it directly impacts their marketing budgets and the effectiveness of their campaigns. In recent times, the CPC in Google advertising campaigns has been on the rise, leaving marketers and businesses concerned. This increase in CPC can often be attributed to changing market conditions, economic shifts, and consumer behavior. In this article, we will explore how changing market conditions can lead to a surge in the Cost Per Click and offer insights on how to navigate these challenges.

Market Economics in Flux

The world of advertising operates in close tandem with the broader economic landscape. Market economics play a pivotal role in determining the success or cost-effectiveness of advertising campaigns. As of the present, several factors in the market are contributing to an uptick in CPC, and understanding these dynamics is crucial for businesses looking to maintain a competitive edge in the digital advertising arena.

1. **Rising Interest Rates:** 

One significant factor impacting the increase in CPC is the rise in interest rates. When interest rates go up, borrowing costs increase for both individuals and businesses. This has a direct impact on consumer spending, as higher interest rates can discourage borrowing for major purchases, such as homes and automobiles. Consequently, businesses in industries like real estate, automotive, and home improvement are experiencing a decline in demand. In response, they are intensifying their online advertising efforts, causing competition and, subsequently, CPC to rise as more businesses vie for the limited pool of potential customers.

2. **Real Estate Market Fluctuations:** 

The real estate market is particularly sensitive to changes in economic conditions. In the scenario you mentioned, where fewer homes are being sold and prices are declining, potential homebuyers become cautious. Uncertainty in the housing market often leads to longer sales cycles and reduced demand for related products and services. Real estate agents, mortgage brokers, and home improvement companies, among others, are forced to allocate more resources to online advertising to attract potential customers, thereby driving up CPC.

3. **Consumer Behavior Shifts:** 

Changing economic conditions can also prompt shifts in consumer behavior. In times of economic uncertainty, consumers tend to research more extensively before making purchase decisions. This increased research phase translates into a higher demand for informational content and ads that provide value, further intensifying competition and driving up CPC as advertisers vie for user attention.

Navigating the Rising CPC Challenge

While the surge in CPC due to changing market conditions may seem daunting, there are strategies that businesses and advertisers can employ to mitigate its impact:

1. **Refine Targeting:** 

Invest time in refining your audience targeting. Ensure your ads are reaching the most relevant and interested users. This can help improve click-through rates (CTR), which, in turn, can reduce CPC.

2. **Optimize Ad Campaigns:** 

Regularly analyze and optimize your ad campaigns. Adjust keywords, ad copy, and landing pages to ensure they are aligned with changing market dynamics and consumer preferences.

3. **Budget Management:** 

Reevaluate your advertising budget allocation. Given the rising CPC, it may be necessary to adjust your budget to maintain a consistent level of ad exposure and conversions.

4. **Quality Score Improvement:** 

Work on improving your Quality Score, a metric Google uses to measure the relevance and quality of your ads. A higher Quality Score can result in lower CPC.

5. **Diversify Advertising Channels:** 

Explore other advertising platforms and channels, such as social media, email marketing, or content marketing, to diversify your marketing efforts and potentially reduce your reliance on Google ads.


First let me answer the question this way.  You should spend the amount you can afford to comfortably keep spending money for about 8 months before you get any money back.

Why is that you may ask?

Well think of it this way, the average agent will close a deal within his/her first 8 months of being on online leads.  That's average, this means some agents get a closing within their first month, some in their 3rd month and some it could take them 2 years before they close a deal.

To improve your chances of success, be sure to take our completely free Lead Conversion Course.  Top team leaders are having their entire team take the course, you should too.  It's free afterall.

Is it enough, should I spend more?

So, first, let's say you are spending $5/day, that's about $150/mo.  If you cost per lead on average is about $10/lead you should get getting about 15 leads per month from that ad spend.  

Depending on how long you've been doing this, you may have come to an understanding that you close 1 deal out of every X # of leads.  For an average agent that X is 100 leads.  So if this was true here as well you would need to spend $1500 to get one deal.

So when you ask your self, is $150/mo enough, think that it will take you on average 10 months to close 1 deal.  So again, if that's all you can afford then yes, that's all you spend, but if you can afford more, do yourself a favor and cut down on the amount of time it will take you to close a deal.  If you spend $300/mo it will take you 5 months to close a deal, if you spend $600/mo you should be closing a deal every two and a half months.

If I spend more per day, does Google waste my money?

No, spending more per day will allow your ads to stay on Google for a longer period and will get served to more searchers.  Google bills you on a per click basis, well actually it's per impression basis but they show you that they click on a per click basis.  If you spend more per day you should still continue to get the same cost per lead on the keywords you are targeting.

It's only when you get into spending very high amounts per month that you now have to start getting creative and maybe targeting more competivie keywords to get traffic and thus having to have a higher cost per lead.


The cost

Here is the cost breakdown to use AgentLocator as your solution for real estate lead generation for your office.

Package Deal $399/mo ($199 Setup fee)
CRM Accounts:
It includes a main brokerage CRM account + up to 10 additional CRM accounts for team members.
Includes 1 Branded + 1 Lead Gen website for the brokerage.

+ 10 sub domain websites, one website for each agent.
Additional Cost Per Account:
$15/mo/account after the 10 are used.
Google/Bing/Yahoo Ad Spend:
We will manage up to $2500/mo in Search Engine Ad Spend in this fee.  

Once you go over $2500, it's billed at 20% of ad spend above $2500/mo.
Facebook Ad Spend:
Includes us running up to 2 simultaneous campaigns.  No limit on ad spend.

This package will give you the ability to have 11 people on the system.  1 Main CRM account + 10 additional agents.  They will each have their own login and you will be able to assign leads to each of them and they would only see the leads that they are assigned to.

How Assigning Leads to Agents Works

You can choose to assign the leads first to an ISA and then have that ISA assign leads manually to your agents.  Or, alternatively you can auto assign leads to your agents based on a round robin policy or a weighted round robin policy.  You also have the ability to specify specific price point policies.

What that really means is, let's say you have some agents who deal with multi million dollar luxury properties and you want to make sure if a lead comes in that's looking at multi million dollar homes, they can be segmented into their own round robin policy.

Or if it's a weighted round robin, you could have one agent getting 50% of the leads while the other two get 25% each.

Features Agents Have/Need to Make Lead Gen Work

What agents need to be successful with online leads is all included in this package.  With one exception.  For you to be able to send SMS messages and make calls to leads right inside of the CRM system, you will need a Twilio number.  

There is no extra cost with AgentLocator to have your own Twilio #, you will have an extra cost with Twilio.  The cost to get 1 phone number with Twilio is $1.15 CAD or about $1 USD per month.  The cost to use their SMS service is billed on a usage basis.  SMS is one of those core features that you SHOULD get for every agent.  Many times the speed to lead is important and the AgentLocator platform gives you the ability to create automated SMS/Email qualification campaigns to help qualify the leads so you should get it.

The cost of SMS messages is really inexpensive as well.  As an average, if you were to generate about 100 leads per month between the agents you should spend about $15/mo in SMS costs with Twilio.

Automated listings, tracking of what's happening who's opening looking at listings, how many photos they are looking at, everything is built in to make sure you have the information you need to stay in the know about what their wants/desires are.

Mobile app both CRM & Home searching app, fully integrated into the whole experience so that it's seamless to the agent and the leads.  Everything the leads do on the home searching mobile app is also tracked and you can see it all in the CRM both on Mobile CRM & Web CRM.

Our lead buckets make it easy for you to create lead qualification pools.

We've even created a step by step 7 hour guide about converting online leads that you can have each of your agents go through.  The training guide is completely free, we've received some raving reviews about our training guide from experts that have been in the online lead generation field for years.


When someone starts looking for a home these days, what are they doing?  Where are they going to look at homes?

Yes, a good % of those looking are going to & directly.  There is no question about that.  Any agent that isn't buying leads from Zillow & Realtor is loosing out (BIG TIME).  However, the days of being able to buy leads are numbered.  I won't go into detail here, you can read more about that in this blog post.

A decent portion of people searching for a hole will eventually do a Google search for one, there are thousands of different variations of searches people do but that search could look something like "Homes for sale in Chicago".

By advertising on Google Ads you are essentially putting yourself in a position where you are going to get people to use your website to search for a home rather than the portals. 

There is one big problem with these leads.  The quality of the leads is not even close to the quality of a lead you will get from Zillow/Realtor.  Why is that you ask?  Well think about it.  When someone is contacting you about a listing on Zillow/Realtor, how long have they already been looking on the portals before they actually decided to contact an agent about one of the listings? 

Let that sink in for a second.  Someone who goes to Google & searches for homes for sale in whatever area is at a much earlier stage of the buying process then someone who's been looking at listings on the portals and makes the decision to contact someone about a listing.

So, the first think ou need to do is to understand the approach you need to take with these leads has to be different.  (AgentLocator not only helps you get leads & has an amazing system for handling the leads they will also train you on how to talk to these leads and what to say)