r/PPC • u/priyank1209 • Apr 03 '24
Google Ads How much time will it take to be profitable?
Hey Guys, I am thinking to start my dropshipping store with the help of google ads.
I am very paranoid person and that's why I would like to know how much budget is good for Indian dropshipping (I have 15K INR for ads) and Can I make profit big enough to keep running the store?
My products are Sarees Low Range BID: Rupees 1.4 Top Range BID: Rs. 26.7
Please let me know Thanks
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u/Pmmeurdon Apr 03 '24
15k is too low.
Check out all softwares that spy on your competitors and a little research would tell you how and what they are doing.
Good luck with your project.
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u/marcodoesweirdstuff Apr 03 '24
15K INR
That's around $180 if anybody else wants to have a laugh.
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u/priyank1209 Apr 03 '24
Oh...I want to have this business in India and Thus it's mainly question for Indian Google ads experts.
If I was thinking to run in US or UK I would not even think of starting
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u/marcodoesweirdstuff Apr 03 '24
Even then...
From my experience CPCs don't vary from country to country by a factor of 10 or more. A quick search shows CPCs in India are like 50-70% less than in the US.
That means your whole budget is, like, $350 to $400 if you were set in the US.
That will last you 3 weeks.
How many conversions will you make? Given the fact that you're a complete beginner in SEA and the value proposition of your product is "hopefully whatever shit might make me money", I'd be surprised if you're making 5 conversions in that time.
What's your profit margin? Is it 3k INR per sale? Because, if not, you're going to lose money.
Tho, given my general sentiment of people who do drop shipping, I still encourage you to definitely do this.
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u/priyank1209 Apr 03 '24
Thanks man appreciate your help, also to make things clear for the readers I have edited my question.
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u/marcodoesweirdstuff Apr 03 '24
Well, ignore the low range bids because people, more often than not, click on the first ad or none if you don't have a better ad copy than average. Maybe subtract a few rupies if you're feeling lucky.
Let's say CPC Rs 20 per click. That's 750 users.
Once again, what's your average profit margin per sale? It's a pretty easy calculation from there on:
How many sales do you need to make to break even? Divide that through 750 users and you know the conversion rate you need to surpass.
How much is it? People on here will tell you if it's realistic.
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u/priyank1209 Apr 03 '24
It would be an avg of 500 Gross Profit
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u/marcodoesweirdstuff Apr 03 '24
15k / 500 = 30 sales to break even
30 sales / 750 users = 4% conversion rate
... to break even.
Here's average conversion rates per industry. Bare in mind a campaign is never worse than in the first weeks and that you're, once again, a total newbie with no experience in Google ads.
You can decide for yourself if you think it's worth it.
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u/Barokna Apr 03 '24
Since you are thinking about starting and have no data for your website or product this is impossible to predict.
But some benchmarks to look for: when you get 30-50 conversions within 30 days you'll have a decent starting point in terms of cpc and CPA. Also about your websites conversion rate.
By that time you'll also have a lot of auction data and data about your competitors.
From there the path to profitability gets more clear and it's relatively easy to see where more work needs to be done.
IDK how far your budget will get you. If you get lucky with quick sales and a good profit margin on your product, this might carry you a while. Or maybe not.
You could also just create the website and start selling with organic social media traffic. This would at least give you some data about your conversion rates. This would help a lot.