|
rise above your competition in 2010
|
Articles and Tips for Profitable AdWords Campaigns |
| |
As a professional AdWords
campaign management and
training provider, we spend a good deal of our time
ensuring we're up-to-date with the latest developments in Google's advertising programme.
This is becoming increasingly important as Google seeks to generate more revenue from AdWords, a trend
that isn't always in the best interests of their advertisers.
Please feel free to suggest a topic you'd like us to cover, and
Subscribe
Subscribe to our Articles...
Just leave your email address and we'll notify you each time we post a new article.
|
if you want us to notify you when we post a new article.
|
|
Is there a feature of AdWords you'd like to understand better? Tell us and we'll do our best to cover
it with practical advice...
|
|
Contact us
|
|
|
| |
Do you have Money to Burn? |
|
|
Introduction
It never ceases to amaze us how many
AdWords customers
start spending money without calculating the Return On Investment (ROI) they expect.
In this article, we discuss the importance of establishing clear conversion metrics for your online business,
together with some real-life examples to help you get started on the road to profitable AdWords.
Initial PPC Conversion Metrics
Before you even think about creating your first
AdWords campaign,
sit down and work out your initial Pay-Per-Click (PPC) conversion metric. Here's a sample template for a
product or service that retails at £30.00.
| Impress |
CTR |
Visits |
Rate |
Sales |
Revenue |
Profit |
GPM |
| 1000 |
1% |
100 |
2% |
2 |
£60.00 |
£10.00 |
16.6% |
| Max CPC |
|
£0.50 |
|
|
|
|
|
| Total Cost |
|
£50.00 |
|
£25.00 |
|
|
|
The Click-Through-Rate (CTR) of your ads will become a factor over
time. Increasing your CTR though optimisation will improve your Quality Score, reducing the average
Cost-Per-Click (CPC) paid for each visit. However, your initial metric should employ the maximum CPC
you're prepared to pay.
Unless you have data to justify a higher figure, assume a conversion rate of between 1% and 2%.
Using these assumptions yields a Gross Profit of £10.00 per 100 paid-search visitors, and a Gross Profit
Margin (GPM) of 16.6%.
Incremental Cost Reduction
If you're new to online marketing, these margins may appear very slim, however, the upside becomes
apparent when you consider even a small change in either the cost of acquisition or conversion rate.
Below is the same metric, but with an Average CPC of £0.30p rather than the maximum of £0.50p.
| Impress |
CTR |
Visits |
Rate |
Sales |
Revenue |
Profit |
GPM |
| 1000 |
1% |
100 |
2% |
2 |
£60.00 |
£30.00 |
50.0% |
| Avg CPC |
|
£0.30 |
|
|
|
|
|
| Total Cost |
|
£30.00 |
|
£15.00 |
|
|
|
Combining a reduced CPC with a 1% gain in your conversion rate yields a GPM of over 66%.
| Impress |
CTR |
Visits |
Rate |
Sales |
Revenue |
Profit |
GPM |
| 1000 |
1% |
100 |
3% |
3 |
£90.00 |
£60.00 |
66.6% |
| Avg CPC |
|
£0.30 |
|
|
|
|
|
| Total Cost |
|
£30.00 |
|
£10.00 |
|
|
|
A Real Life Example
The value of a conversion metric becomes clear when you create a new ad group, and Google offers you the
option of buying the "most click possible". This example is taken from an
AdWords Tune-Up
we did on the campaigns of a leading UK software house.
They'd adopted AdWords recommended Maximum CPC bid of £2.82, yielding 930 visitors per month at an average
CPC of £0.44p.
| Impress |
CTR |
Visits |
Rate |
Sales |
Revenue |
Profit |
GPM |
| 1000 |
1% |
930 |
3% |
28 |
£976.50 |
£567.30 |
58.1% |
| Avg CPC |
|
£0.44 |
|
|
|
|
|
| Total Cost |
|
£409.00 |
|
£14.67 |
|
|
|
While their campaign was profitable, overriding Google's recommended max CPC with our own (£0.50p) yielded
the following result:
| Impress |
CTR |
Visits |
Rate |
Sales |
Revenue |
Profit |
GPM |
| 1000 |
1% |
840 |
3% |
25 |
£882.00 |
£747.60 |
84.7% |
| Avg CPC |
|
£0.16 |
|
|
|
|
|
| Total Cost |
|
£134.40 |
|
£5.33 |
|
|
|
Note that dramatically reducing the max CPC bid from £2.82 to £0.50p did not result in a comparable
fall in traffic (thanks to better keyword segmentation), and produced more revenue from fewer
visitors thanks to a significantly improved GPM.
Build your own Metrics with our Free Spreadsheet
Having a conversion metric for each type of campaign (PPC, CPM, etc.) and product line you offer is
fundamental to achieving your advertising goals on Google. Armed with these, you'll always know what
you can afford to bid, and the conversion rate your site needs to deliver.
We've taken a few common metrics and put them into a
Microsoft Excel spreadsheet
for you to download and use with you own campaigns.
|
|
|
| |
Putting the Ad into AdWords |
|
|
Introduction
When you're new to AdWords, it's tempting to devote far too much time and energy in trying to craft
that "killer" ad. But the truth is that writing ads is a science, not an art. Here are a few of the
rules.
Never Fly Blind...
In over four years developing
AdWords campaigns,
we've never seen a profitable example that didn't track conversions.
AdWords Conversion Tracking is simple to install and a "must" for measuring ad performance. Remember, by
itself the Click-Through-Rate (CTR) of an ad tells you nothing about the ROI it's delivering. We've seen
many examples of ads with a lower CTR, but higher conversion rate.
Google Analytics obviously adds a great deal more data, but takes time to master. However, one feature
worth using immediately is its ability to tell you which ad position yields the best results.
Finally, don't forget the AdWords Reports section. This has improved significantly over the past year,
and the Search Query Performance report is a real asset in optimising keywords and ad copy.
Cut out the Middle Man...
In this case, the "middle man" is Google. When developing and testing your ads, it's vital to put
yourself in control as far as possible...
Delivery Method
By default, Google spreads the delivery of your ads evenly throughout the day, ensuring
you don't exhaust your daily budget (and they get to spend as much of it as possible). However, it also
serves to mask the true demand for your product or service. We have seen many cases where ads are more
profitable at certain times of the day. If you have a limited budget, spend it when you'll get the best
return. We recommend running campaigns using Accelerated delivery. Keep an eye on your daily budget and
adjust accordingly.
Ad Serving
If you're running multiple ads, Google will automatically
start favouring the one with the highest CTR once a certain volume of clicks have been received.
We never use the default Optimise option, and recommend you select Rotate for ad serving.
We have AdWords campaigns for some of our clients that have been running for over three years, but we
always maintain at least two ad variations per ad group. Even if there's only a single word difference,
one ad will ultimately prove superior and deliver an improved ROI. The Rotate option also gives you more
granularity when testing ad variations. Say you want to do a 1/3-2/3 split; you simply create two
copies of ad "A" and one of ad "B". Using the same principal allows you to create 60/40 and 70/30 splits,
which are very useful in some circumstances.
Network Options
Start your testing using Google's Search network only.
Uncheck both their Partner and Content networks. Once you have some solid data from mainstream search
traffic, you can add their Partners. Google's partners are a pretty "mixed bag", and you may decide to
exclude them altogether (we often do). Finally, enable the Content network and Content Bids. Never run
on the Content network with the same bid as Search - you're just handing Google money. By default,
we set Content Bids at 1/10 of that on the Search network: so if your Search bid is 0.50p, set your
Content bid to 0.05p for openers. If you find your product or service has "traction" on the Content
network (true in about 25% of cases in our experience), it may be worth running separate campaigns for
Content searches.
All these options can be set from the Campaign Management tab in your account. Select a campaign and click
the Edit Settings button.
A Stitch in Time...
It's important to optimise your ads (and separately your keywords and bids) to a fixed schedule. By
default, we run a three-month cycle:
- Every three hours for the first day.
- Every day for the first week.
- Every week for the first month.
- Every second week for the second month.
- At the end of the third month.
You can adapt this schedule to suit your click volume, but make sure you have a schedule and stick to it.
You'll learn more about your target audience, and employ your time more efficiently. Don't forget to take
weekdays, weekends and seasonal trends into account.
Study your Competition First...
Before writing your first ad, take time to study your competition using a selection of core keywords and
phrases.
This is particularly important if you're thinking of using Google's Keyword Insertion feature. This is
becoming increasingly popular and can be counter-productive; making your headline look identical to
the competition.
All for One and One for All...
Achieving a good Quality Score, and providing visitors with a rewarding experience, means treating your
keywords, ads and landing page as a single unit.
Ensure your most popular keywords appear in your ad's headline and copy. If you cannot accommodate core
keywords in your ads, segment your ad groups further.
Make sure core keywords follow-through to your meta data and landing page copy. Try to write ad copy that
flows naturally and qualifies visitors to your site. If you sell software for Microsoft Outlook, for
example, a headline such as "Using Microsoft Outlook?" will help avoid Apple users, who might find your
product of interest, but are unlikely to become customers.
Simplicity Sells Harder...
Capitalise letters and words in your ad copy for emphasis (not all the time). Capitalising the first letter
of every word in your copy actually makes reading more difficult.
Be honest and don't use words like "free" unless you're really giving something away for free within 3
clicks of your landing page.
Understand what Matters...
According to research undertaken by Google in 2005, the headline of your ad represents 40% of its impact.
The first line of copy accounts for 30%, the second line 20% and the Display URL 10%.
AdWords' power comes from the ability it gives you to intercept prospects at the exact moment they're
looking for what you sell. The basic PPC ad format is simple, and works best with a single clear message
and a strong call to action.
|
|
|
| |
The Perils of Broad Match Keywords |
|
|
The poor use of broad match keywords is one of the easiest ways to waste your money on AdWords,
and it's not just a problem for novices. Google are changing the rules behind the scenes...
When we ran our first
AdWords campaigns
back in 2003, broad match (or "expanded match" as it was then known) was limited to all the keywords
in any order, plurals, synonyms, etc.
Today, the term "broad match" is - well - broader. Take this example from one of our contacts in
the US: A friend of theirs, who happens to be a keen fisherman, was searching Google for "fish bait".
He was surprised to see an ad displayed for "Sony in-car CD players". Intrigued, he
clicked on the ad and contacted the website. The owners of the site were equally surprised,
and emailed Google to see what was going on.
After several exchanges with a rather reluctant member of the AdWords support team, they were finally
offered this explanation:
"...Bass is a type of fish. It's also a type of speaker found in hi-fi's and CD players.
CD players are found in cars, hence, the term "fish bait" triggered the ad..."
Google's logic is simple: Relaxing the criteria for broad match yields more clicks, and clicks
equal revenue.
Our
AdWords training courses
focus a great deal on keyword research and campaign segmentation, starting with the following simple
guidelines:
No of
Keywords |
Example Phrase |
Bid Recommendations |
| 1 |
antiques |
Never bid unless it's a brand or acronym. |
| 2 |
antique tables |
Phrase or Exact only. |
| 3 |
antique victorian tables |
Phrase or Exact only. |
| 4 |
antique victorian dining tables |
Broad, Phrase or Exact. |
| 5 |
antique victorian mahogany
dining tables |
Broad, Phrase or Exact. |
|
|
|
| |
Brush away the Cobwebs on your Meta Data |
|
|
It's now accepted wisdom that Google ignores meta keywords when spidering your site for natural
search, but is the same true when the AdWords spider comes to scan your landing pages?
Over the past three months, we've been looking at new ways of improving the performance of our
clients'
AdWords campaigns.
One of these was to measure the effect of landing pages on their Quality Score, and the average
Cost-Per-Click (CPC) paid for each visit.
When designing websites and landing pages, we always follow Google's
Webmaster Guidelines,
and are careful to avoid copy that may appear to be spamming keywords or phrases.
Our results show that the "keywords" meta tag has a measurable impact on the average cost-per-click in
AdWords, reducing it by as much as 15% over a 30-day period. We've run these tests across a range of
different campaigns and keywords with similar results.
We're therefore adding a new set of guidelines to our
AdWords Training Courses.
Following these simple steps will both reduce your cost-per-click, and improve your position in natural
search results:
| Step |
Description |
| 1 |
Research and rank your target keywords using Google's Keyword
Tool and
Wordtracker
(for natural search results). |
| 2 |
Create, review and finalise your page copy, making intelligent
use of your
target keywords. Write for people, not spiders. |
| 3 |
Create your meta keywords using only words or phrases that
appear in your
copy. Your list should contain no more than 15 keywords (or 300 characters),
be comma separated without spaces and in rank order. Include no more than
3 instances of
a single keyword (to avoid spamming). |
| 4 |
Create a page title with your target keywords. Page titles
should be no more
than 60 characters (including spaces). |
| 5 |
Create your meta description including your target keywords
in rank order.
Your description should be no more than 180 characters (including spaces). |
|
|
|
| |
Fancy a Swim with AdWords Latest Shark |
|
|
In an earlier article on
The Perils of Broad Match Keywords,
we highlighted some of the pitfalls of this form of matching. Now Google is beta-testing an option
which is potentially far more damaging to your budget...
Google's new feature is called "automatic matching" and, earlier this year, selected clients
in the USA received the following letter from their AdWords account manager:
"Automatic Matching automatically extends your campaign's reach by using surplus budget to serve
your ads on relevant search queries that are not already triggered by your keyword lists...
For example, If you sold Adidas shoes on your website, Automatic Matching would target your campaigns
to queries such as: "shoes" "adidas" "athletic", etc., and less obvious ones such as "slippers" that
our system has determined will benefit you..."
Aside from the obvious question of why Google believe a site selling Adidas trainers would benefit from
visitors looking for slippers, we can see no benefit to the advertiser from this new feature.
Our
AdWords Training Courses
cover the different Match Types in some detail. Google's introduction of Expanded
Broad Match has already made life more difficult, by compelling advertisers to make extensive use
of Negative keywords, or avoid Broad Match altogether.
Automatic Matching simply makes this problem worse and - in our opinion - is little better than running
ads on the Content Network. Google seems to agree as - like Content ads - automatically matched
ads do not contribute to your Click-Through Rate (CTR).
Automatic Matching also contradicts Google's rules on relevance. What's the point of writing
highly-targeted landing pages if the keywords around which they're designed aren't accurately matched?
If you're selling specific models of Samsung TV, how would you feel if Google matched your ads to
searches for models you don't have in stock? This was the experience of one unhappy client in the
US trial.
Google currently plans to make Automatic Matching an opt-out feature of AdWords (as with Content
Network ads). Forget to opt-out, and it won't just be a "bigger boat" you'll be needing - it's a
bigger budget.
|
|
|
|
Copyright © AdWords Magic
|
|
|
|
