The True Cost Per Conversion of Additional Conversions

Written on June 26th, 2013 by
Categories: Analytics, Conversion

PPC managers have different targets for their clients. One of the most common targets is to manage the campaigns based on an average maximum cost per conversion (CPA).

What many clients –and PPC managers- don’t know or don’t realize is what the true cost of the extra conversions is. Even if the average CPA is below the maximum allowed CPA, the last conversions might be too expensive and maybe even leading to a loss for the client.

Lets have a look at an example.

Example – the calculator shop

Assume you are managing the account of an e-commerce store that sells calculators. They sell for \$25. The profit on a sale is \$15, with just the ad spend to subtract from the profit.

You are currently managing the campaign and you get 100 conversions for a total cost of \$1,000. This leads to a CPA of \$10. The profit for the client is \$500.

The client however told you the CPA could be \$11 if he gets more conversions as the \$11 is still well within his profit margin of \$15. As a good PPC manager you started pushing the best keywords and magically knew to push 20% extra conversions until you reached an average CPA of \$11. So you now have 120 conversions for a total cost of \$1,320.

You are happy, the client is happy and you live long and happily ever after. But should the client be that happy?

If we have a closer look at the details of the additional conversions:

• 20 extra conversions
• \$320 extra budget

This leads to a CPA of \$16 of the additional conversion! He actually lost money on the additional conversions. The profit is now \$480.

A visual representation of the CPA’s and profit margin

Not per definition as it depends on the goal of the client and other factors that we sometimes don’t know as PPC manager (profit margins, life time value of a client, branding value, increase of the market share etc). It’s important that both you and the client are aware of the price of the additional conversions.

Rick Vugts is the co-founder of Visible Online Marketing. Intrigued by both the psychological and marketing and the statistical side of PPC marketing.

Hey Google: Here’s a Better Strategy Than Coupon Spam

Written on November 29th, 2011 by

There’s something completely broken with the logic of doing everything in your power to bring new businesses to Adwords, then arbitrarily making them pay a “newbie tax” combination of high bids/low Quality Score before their first ad has even had a single impression.

How many new businesses (even those who set up their campaigns according to “best practices”) decide to try out Adwords, only to find that they get an automatic 2/10 or 3/10 for their own brandname as a keyword?  What kind of message are you trying to send to these new Adwords customers?

Why bother sending coupons up the nose of every small business only to slam the door in their face before they even set foot inside?

How about this:  If anyone is brand new to Adwords, give them one week to actually see their ads run at a reasonable price.  If their CTR is too low after a week, turn off their ads and tell them to improve the relevance of their ads or find some new keywords.  If their ads perform well, just let them run.

Either that or improve the alignment of your internal business initiatives so that we can at least save some trees and postal stamps by telling the guys that mail coupons ‘there’s really no point’.

/rant

Review: The Genesis WordPress Theme Framework

Comments Off on Review: The Genesis WordPress Theme Framework Written on November 9th, 2011 by
Categories: PPC Tools

When I’m generating landing pages for PPC or SEO purposes, I’m always looking for quicker ways to deploy and maintain my personal and client sites. I’m a

big fan of automating repetitive tasks, outsourcing, and making sure projects have less room for error and a more “templated” approach.

As WordPress is in many ways becoming the de facto standard for the back end of the web, it makes sense that things are evolving quickly in the customization of the WP platform as well.

Case in point: WordPress Frameworks.  “Frameworks” for WordPress layer on top of a base WordPress installation, and themes layer on top of the “framework”.

Reader Note:  I cover a lot of ground in this review, if you want to jump straight to my conclusions on the Genesis framework click here.

Where “Frameworks” Fit into the WordPress Ecosystem

In essence, the model looks like this:

Stock WordPress Install

—————————-

3rd Party Framework that enables customization shortcuts (in this case Copyblogger’s Genesis Framework)

—————————-

“Child” themes that adjust the look and feel of the site itself, almost like “skin” in a way.

—————————-

= Complete site flexibility

There are a few “Framework” options out there for WordPress, but Genesis is the only one I’m aware of that has been directly endorsed by Automattic, the guys who make WordPress itself.  Hopefully this means less hassles for the Genesis developers in maintaining the balance between the open-source reality of WordPress and the pay-for frameworks that make life more livable for webmasters and marketers.

Studiopress is a company that falls under the Copyblogger Media umbrella business, which of course is owned by Brian Clark, Brian Gardner and other top internet marketing professionals.  I’ve reviewed the Premise WordPress landing page system from these guys before, and highly recommend it.

StudioPress claims the Genesis framework for WordPress as being suitable for novices and advanced developers, and that the core of the framework is SEO optimized out of the box, cutting down on the time you need to spend modifying your themes and landing pages.

The Highlights

• SEO Friendly – Genesis comes with a solid SEO based foundation, right out of the box. This means you don’t need to tinker with your theme to try and customize every little detail or remove useless code from a theme. Genesis also lets you tweak this further in the theme’s admin section.
• Security – It seems everyday you hear about a website being hacked because of running an insecure WordPress installation. StudioPress took no chances and hired renowned security expert Mark Jaquith to make sure your Genesis powered site is secured with the latest techniques and methods.
• Multiple Themes – StudioPress has dozens of child themes to choose from which let you instantly change the look and feel of your website without having to change any of the code – and all child themes maintain the same features and benefits of the base Genesis theme. For more advanced developers, there’s full documentation and an active support community to help you develop your own custom child themes.
• Options for creating customized landing pages for PPC or SEO.

Installation

Installation was a breeze. Just either upload the Genesis folder to the “themes” folder on your website, and activate the theme via the WordPress dashboard like you normally would. Done and done.

Genesis Theme Settings

This is where  you can set the overall theme settings for your new Genesis powered site. Everything from instant updates, layout options, menu configurations, breadcrumbs and custom headers / footers.

One thing that’s great about the Genesis framework is that they verify the framework is compatible with each an every new WordPress update, and you can enable automatic updates as well as an email notification with an update is available. Keeping your installation up to date is one the most critical tasks for any site running WordPress, and Genesis makes sure you’re always current.

I unselected the option to “Display theme information in the header” as I prefer to keep code bloat down. However I made sure to select automatic updates, as well as have Genesis email me when an update is available:

Breadcrumbs – Everyone knows how important breadcrumbs are not just for users to navigate your site easily, but for bots as well. Genesis makes inserting and customizing Breadcrumbs a snap:

Custom Header & Footer Code – How cool is this? Ever wanted to add some widgets just above your footers? Or load some custom AJAX / Javascript in your headers, without WordPress interfering? Genesis makes this easy as cut and paste:

SEO Settings

Now this is one of the most exciting features of the Genesis WordPress framework. The built in SEO options allow you to further customize the excellent out-of-the-box settings to your liking.

Homepage Settings – Often times the home page of a site is going to be very different than the sub-pages.  You might have different content or be targeting a specific key phrase – the Genesis framework allows you to set a few custom settings including the H1 tag, custom Title and Meta tags as well as Robots meta tags:

This is a very useful feature. The amount of junk that WordPress adds to your headers is incredible (Windows Live Writer anyone?). And while there are plugins you could install to try and remove that code, they come with their own issues. You sure, you could manually remove the useless META data from every one of your WordPress sites, or you could simply let the Genesis framework take care of it with a few clicks:

I would leave them all unchecked.

Robots Meta Settings

Again, while there are many plugins you can install to try and manage your Robots META tags, they often run into problems as soon as you start dealing with custom pages and can potentially result in NOINDEX-ing parts of your site or vice-versa. With the Genesis framework you have FULL control over how the META Robots tag works:

Personally, I would “noindex” author, date and search archives. Depending on how your site is setup and how you’re using Category archives you may want to unselect the default “Apply ‘noindex’ to Category Archives”. You can also apply “noarchive” to various types of pages or to the site as a whole. I generally don’t bother with this, but there are times / sites you may want to apply the “noarchive” tag.

Genesis and the associated themes give you the ability to “hang” custom landing page templates with reduced navigation, no sidebars and tighter calls-to-action off of your site.  It’s also fully compatible with the Premise landing page system as well.  There’s a huge advantage in this, in that Google can see the site behind simply your one or two landing pages and realize that you’re a deep, legitamite advertiser who has more to offer than a single lander alone in the universe.  This helps immensely with their Landing Page Quality Score spidering and scoring.  I can’t understate the importance of this in the current Adwords policy environment.

Also note: Because Google also takes into consideration page load time in your Quality Scores, I recommend you host your Genesis install on a SUPER-fast webhost.  Recognizing the importance of this, the Studiopress team also offers premium high-speed hosting services now as well, I’d recommend having a look.

Summary & Opinion

Having personally gone through the pain of hacking customizations of my own into pre-existing WordPress themes (particularly poorly-coded free themes), I can tell you that you DO NOT want to have to redo all of those customizations every single time you upgrade your WordPress version or theme version.  Genesis makes it easy to ‘silo’ away all of  your customizations so that they stay safe during upgrades to new WordPress releases as well as upgrades to Genesis and child themes as well.

I’ve heard a lot of people say “oh, that’s fine, I don’t plan on upgrading anyway so it doesn’t matter”.  Those are the same people that often get their sites hacked because their running outdated and unpatched versions of WordPress or their theme.  It’s not a question of ‘if’, more like ‘when’ will you be upgrading.

All these advantages coupled with the SEO and PPC lift you can get from deploying your site in a Google-friendly way lead me to highly recommend the Genesis platform.

The Genesis framework itself is dirt-cheap at \$60, and you can layer your own theme over top of that.  You can also install the Genesis on as many sites as you want with one license.  Studiopres has a TON of child themes or skins that you can use out-of-the-box as well if you add them on to your Genesis order, and they have a bundle available that lets you get them all for \$299, WAY cheaper than they are individually.  All of their licenses include fantastic support for installation and customization of Genesis on your own site.

Try Genesis out now!

Written on September 13th, 2011 by

Some readers pointed out that the example they highlighted in that Inside Adwords blog post was only using Adsense blocks below the fold, and in some cases only in their footer area.  This meant that they were actually in compliance with Google’s advertiser guidelines on the practice of Adwords-t0-Adsense arbitrage.

The New Rules of the Game

The new guidelines make clear that your “intent” as an advertiser is what really matters when they’re determining if you’re an arbitrager or not (bolding added by moi):

As of today, those guidelines state:

Google AdWords doesn’t allow the promotion of websites that are designed for the sole or primary purpose of showing ads. This practice of promoting sites where the main purpose is to get users to click on ads is called arbitrage.

OK, so as long as I really, super-duper promise that the purpose of my landing page is NOT to have a user click Adsense ads, it’s game on…

To illustrate how Google decides whether a site’s “sole or primary purpose” is to show other ads, they’ve provided some handy examples of ‘what’s acceptable’:

Here’s the example they show of an “OK” use of Adsense on an Adwords lander:

Now, here’s the example they give of a page where “the primary purpose of the page is to show ads”:

OK, so it seems the biggest determining factor here is the placement of the GIANT Adsense block, here it’s in the highest-CTR area, the Top-Left.  Got it.

This is why today my interest was piqued by an Adwords search ad from a site that is typically a ‘publisher’ site, not an advertiser per se.

Perhaps after Panda, the folks at “unnamed-answersite.com” have determined that arbitraging their Premium Adsense Feed (the one that REALLY makes Google’s ads look like your own site content) is a better business model than chasing the SEO Dragon.  After all, if Panda left you with no profitable free traffic, but a highly-coveted Premium Ad Feed from Google, you might as well put that feed to good use.

Which goes to this jewel of a landing page (click to enlarge the awesomeness):

As you can see, they have managed to artfully insert their Adsense ads not only in the top-left money spot, but shove their own offering to the sidebar where Google feels their Adsense ads could acceptably go.  Well played.

Guidelines Are Changing, Time to Get Over It

In the past I‘ve railed against the crap Google has looked the other way on, but lately I’m becoming a lot more pragmatic.  As Aaron has pointed out time and time again, Google has different rules for different players, and Adwords is no different.  The double standards are what they are, so if you have the ability (via brand recognition or relationships) to push the envelope on the advertiser guidelines you might as well do it.

The above is a great example of how to do arbitrage effectively in today’s guideline environment, and the risk that imitating them if you’re big enough and getting whacked is pretty low judging  by the current state of Adwords policy suspensions (or lack thereof for big accounts).  Google is currently much more likely to “work with you” to remove things they may have an issue with in the future than they have been in the past, so you might as well shoot for the stars.

Of course, this model isn’t going to sustainably work for smaller, independent players without brands or businesses that suddenly launch out of nowhere on a mission to arbitrage as many Adwords clicks as they can:  They’ll see you coming a mile away if you go from ‘zero to hero’ with a brand new site, but established brands who have Adwords account teams and a long-standing Adwords track record can leverage whatever ROI-maximizing opportunities Google drops in their lap.

It’s good to be the King…

Time to Play ‘PPC Ad Copy Survivor’ : BoostCTR Review

Written on August 30th, 2011 by

About a year ago I chatted with David from Boost CTR about his new business, designed to get writers to compete in contests for their advertiser customers to see who could write the highest CTR ads.

If the writers’ ads performed better than the customer’s control ads, Boost CTR gets a small commission.  Pretty simple yet brilliant value proposition for Adwords advertisers who want to see if they can jack their CTRs, which in turn earn them higher Quality Scores and lower CPCs.

Four Challenges to BoostCTR’s Model

It’s kind of like the TV show “Survivor” for ad copy writers.  I wasn’t sure if it would fly however for four specific reasons:

1. Would enough decent writers actually participate in the contests to get some decent results?
3. Would said writers toilet my brand by running ads that weren’t a fit or appropriate for my campaigns and my business?
4. If I gave Adwords API access to BoostCTR would they be able to steal my campaigns and compete with me?

Add to that from an entrepreneurial standpoint: Could BoostCTR carve out a decent business even though they don’t offer soup-to-nuts campaign management, a bid management system or keyword research solutions like most of the PPC performance enhancement platforms offer, aka. “Can they make a successful business by focussing on ad performance improvement only”?

Well, it’s now a year later and their business is booming with a whack of big-name advertiser clients, so I guess so…:)

How it Works

OK, so here’s how BoostCTR works for me as advertiser:

• After I’ve submitted at least one ad group, BoostCTR’s expert writers compete against each other to beat my best ads.
• I only pay when BoostCTR is able to beat my current control ad. (I can track either CTR or conversions to determine the winner.)

Here’s some screenshots of the advertiser UI (Click to Enlarge):

From what I’ve see in Google ad copy lately, many, many PPC managers could use a hand in the ad copy department, so a bit of fresh blood writing for you can’t hurt here.  In fact, it’s not uncommon for PPC managers to split-test a few ads, then leave the best performing ad uncontested for months at a time.

Then there are active PPC managers who’ve been writing ads for the same business for years. They’re always testing new creative, but they’ve gone through all their best ideas and need a fresh perspective from somebody who’s seeing the account for the first time.

It’s kind of similar in many ways to ’99designs’ where web designers compete with their mockups to earn your business, but you only pay when you find a winner…except here we’re talking ad performance improvement.

Sounds awesome, but what about the questions I mentioned above?  Read on…

What Do You Know!? Good Writers Can Write For Anything…

So were they able to find pro writers to compete in my ad contests?  Yup, in fact I’ve heard from a few people I know quite well in the PPC biz who bang out great ads for them on the side. It turns out they now have hundreds of writers competing in the time since I originally spoke to David, their CEO/Founder.

Can they write for my niche?  Apparently so, CTR and conversion improvements on winning ads averages around 30%.  Some see bigger boosts, others smaller, but they regularly beat the control ads which is the whole point.

Check out some examples here on their “Win of the Week” blog.  (In one case they increased an ad’s CTR by 415%)

Campaign Data & Privacy

BoostCTR has thought this through pretty well and their security measures are tight. For instance, when you submit an ad group to BoostCTR only a handful of the broad search phrases are included for writers to see. No other data is included, so search volumes,CTR, and profitability are never revealed.

BoostCTR writers rely pretty heavily on their own research and experience, as well as any information you include in your creative brief. The brief includes any specific requests you may have for how new ads are written.

While I don’t have control over who writes for my account or what ads are submitted per se, I still get the final say when deciding which ads to test and which ads to reject.  The creative brief I whip up ahead of time for the writers helps prevent ad submissions that I’m not comfortable with. But even if you do get an ad I don’t like, I can reject it.

*When I reject an ad, I can also send comments back to the writer so he knows how to write better ads for me on the next round.

The Good and Bad of Crowd-Sourcing

If there is any downside to BoostCTR, it’s that you can’t choose or put a face to who writes for your contests. It is bonafide “crowd-sourcing” — an anonymous group of people who all work to improve your PPC ads. That said, the writer or writers who end up working on your ad groups may change depending on the time of day, week, and month you post new contests.

On the flip side, this lack of choice saves you time. Rather than worrying about the person writing for you, you can divert all your attention into deciding whether or not to run the ad or ads that have been submitted, which is a lot faster and easier.

And while this approach is a bit unorthodox, it’s worked well so far. BoostCTR already has a stable of “Big Name” clients including CafePress, Expedia, 99 Designs, Beach Body, and many more.

Personally I don’t care who writes it as long as it lifts myCTR and is appropriate for my campaign.  I’m looking for improved numbers vs. personality.

Who Should & Should Not Try BoostCTR

Obviously, if you’re ad spend is under \$250 a month, or if your search volumes are low, then BoostCTR probably won’t be a good investment for you, try growing your traffic first.

But if PPC advertising is a big part of your marketing, and you’re spending thousands of dollars a month, you need to try it.

(NOTE:  I asked David for a trial for PPCblog readers, here’s the “ONE FREE CONTEST” Link Here They Provided)

I have to eat some crow here BTW as well.  I personally was not sure their model would pan out, but they’re kicking butt at this and have now even expanded into doing Facebook image ads, something that’s a major pain due to the fickle nature of FB CTRs and requirements for constant freshness in your ad creative.

Congrats to David and team (Now including Tom Demers formerly from Wordstream – good guy that Tom) on building a successful model by really hammering on one key pain point for advertisers: lifting conversions and CTRs with better ad copy.

Go give it a try!

PPCblog Review: Mixrank Competitive Ad Research Tool

Written on August 17th, 2011 by

I’m always on the hunt for new ways to data mine the competition.

After seeing a beta Adsense competitive research tool called MixRank reviewed by VanillaCoke on the Seobook blog I thought I’d take a bit of time and check it out for myself.  I was also curious to see how it compared with another competitive research tool I’ve reviewed for PPCblog called WhatRunsWhere.  You can read that review here.

In this example I’m looking to dig up data in the health vertical.

First thing you’ll notice when you perform a search on MixRank is the handy auto-suggest feature on the field, ordered with the biggest advertisers on the top. Type in one of you’re broadest keywords and you’re likely to get a whole list of domains who you’ve never though of checking out. I started with health… and clicked on the first result healthline.com

The results appear quickly and when the page comes up it’s logically broken up into text ads, banner ads, and traffic sources.

Starting with text ads, I’m able to immediately see healthline.com’s top variations. The default sort is based on ad frequency, but all the columns are sortable, so by clicking on the publishers column, I can see which ads are getting the widest site distribution. Conveniently, all data is exportable for  those of us who like to crunch data from all directions in Excel.

Flipping to the Ad Reach tab, I’m able to see a graphical representation of the total publishers reached per ad. This is the same metric as the previous screen, but in this case its charted over time, enabling me to quickly spot ads that are being ramped up or phased out. This is also great reminder that summary data can be deceiving. All time best performers aren’t always what works best right now. You need to see ad trends, and with this feature they’re quite clear to see.

MixRank’s best performers tab is pretty self explanatory. It graphs ad performance (based on impressions and average position) over time. Once again, immediately pulling out the ads that are going to be your biggest competition.

On to the banner ads section. I like that MixRank allows you to download all the banners from the ‘download all’ link. I do wish there were some metrics in this area to help me determine which banner ads are performing the strongest, and/or which sizes are getting the most play, but even just having the images and the last seen data (available by clicking on the images) is valuable. Certainly useful for inspiration/strategy on ad design.

MixRank’s  traffic sources section details all the sites healthline.com is getting impression share on. As well as the following data points:

• Uniques – estimated number of unique visitors
• Last Seen – the last time MixRank saw the ad
• Days Seen – number of days in the last month MixRank was shown the ad
• Average Position – the advertiser’s average position in the AdSense block

For PPC, this is great for identifying sites that could be well suited to your campaigns. It could also be a way to identify where you’re competition isn’t getting traction – and an opportunity to either exclude the domain or optimize your ad content and outperform them.

On the flip, as an Adsense publisher also, taking a look at some of the better performing sites was a bit of an eye-opener on what types of verticals I can optimize for. 🙂

Summing up, if you want to get a leg up on your competition, here’s what you’ll get from MixRank:

• the competition’s text ad copy and relative performance
• the domains where their ads are showing

While there’s no shortage of spy tools available for Adsense data, going through them, you find that many are so complex that you can’t just get in, get the data and get out without losing a whole chunk of your day.  So far, MixRank appears to be good at distilling the data down to useable, actionable bites.

The *beta* version of MixRank, which is being offered while they ramp up, is also laced with teasers for features that are on the way. I’m quite keen to see what they have in store for the ‘keywords’ and ‘best traffic sources’ tabs.

For the time being, MixRank is free, so go sign-up for the beta and give it a spin. As with all of search tools, it takes a little time for them to build up their database, but so far they’re tracking 93K+ sites, so you’re bound to learn a thing or two.

REVEALED: Google’s Top 20 Most Expensive Keywords

Written on July 19th, 2011 by

I’ve been wanting to try out sensational headlines for a while now heh:)

Based on data from their massive in-house keyword research database and Google’s Keyword Tool, the team at Wordstream compiled the top 10,000 most expensive English-language keywords over a three month period, and then sorted them by niche.

Here’s how it breaks down, see if you can spot your niche in here (click image to enlarge):

Written on July 5th, 2011 by

Perhaps you’ll find this scenario familiar:

Your Adwords search campaign for “Vocal Lessons” features a fairly broad, say two-word keyword phrase like “can’t sing”.

You notice that the conversion rate is OK on this keyword, but the cost-per-conversion is a bit high. You’ve tried tweaking the bids on it to get it more profitable, but it’s still just barely profitable.

Looking into it more deeply, you run a Search Terms report to see how Google matched your phrase-matched keyword to actual user queries.

You notice that the exact match [can’t sing] has generated a lot of clicks but no conversions, whereas the exact match [why can’t I sing] is the search that’s actually driving the conversions on that “can’t sing” keyword.  In fact, the cost-per-conversion and conversion rate on that exact [why can’t I sing] keyword are fantastic, and you would like to get more of that ‘hot’ traffic and those cheap conversions.

So, you decide to add that exact search, [why can’t I sing] to your adgroup as a keyword on its own.  Maybe you also raise the bid a bit on it to try and improve your ad position, hoping to grab even more conversions.

Then something strange happens:  After a little time has gone by, you notice that that exact match keyword, [why can’t I sing], isn’t converting at all anymore.

What happened to those sweet, sweet conversions?  You even bid up trying boost your ad position and that should give you more conversions shouldn’t it?  What’s happening here?

Blood From a Stone?

A good friend of mine (with an infinitely higher level of PPC skill than mine) once told me a few years ago: “Geordie: You just can’t buy more conversions”.  This was his point and it applies both to Display Network placement campaigns as well as Search:

Sometimes Google’s ‘mad scientist’ mix of bid, placement, matching tech, and other factors combine in your favour and find pockets of traffic that for whatever reason, be it ad-to-keyword performance, bid, match type voodoo, or whatever, creates a ‘conversion sweet spot’ where the traffic ‘just works’.

That’s great news, but you can find yourself getting ‘conversion greedy’, trying to make that ‘perfect storm’ of elements spit out more conversions.  It just doesn’t always happen.

In fact, more often than not I’ve found the opposite happens: One element (the exact match keyword) has been yanked out of the perfect storm and the entire sweet spot up and disappeared. Now, not only do you not end up with more conversions than you had previously, you can often end up with none.

Again, you ‘just can’t buy more conversions’, or put another way, ‘you can’t get blood from a stone’.  If something is working, and working exceedingly well, you may be best off simply leaving it alone.

Another Approach to Tweaking the Keyword’s Profitability

“But that phrase-matched keyword was barely profitable overall, you can’t just leave it like that!”.  That’s true.  However you can make adjustments another way without messing with the mojo.

For example, if the Search Terms report shows, as it does in our example above, that when Google matches [can’t sing] to your phrase-matched “can’t sing” keyword, you net a lot of clicks but very few (if any) conversions, you can try adding the exact match [can’t sing] as a negative keyword for this adgroup only.  This will filter out exact match searches for [can’t sing], but won’t stop your ad from showing on [why can’t I sing], the query that nets you the most conversions.

* What can you do if you’ve tried isolating the keyword or placement and conversions went South?  All is not lost, often you can revert to the adgroup’s previous configuration and bids and things will right themselves.  This often works, but nothing is ever guaranteed in Google-land.

The Only Route to More Conversions

The bottom line is that sometimes you just need to accept that you’re getting the best quality and quantity of traffic Google can give you on a particular keyword scenario or Display Network placement.  Of course, you need to be profitable overall with your phrase-matched keyword, but it is completely possible to ‘mess up the mojo’ with what is working and shoot yourself in the foot by trying to get more for less.

If you want to garner a higher volume of conversions, you often need to move on and find another ‘sweet spot’ or ‘perfect storm’.  The only way to do that is to keep testing new adgroups until one presents itself.  What you’ll find is that there are pockets like this everywhere.  In one of my campaigns, a scenario like the one mentioned here has netted over 28,000 conversions over 4 years.  Having learned this lesson the hard way, I’ve let sweet spots like that lie and work their magic over time.

Have you run into this scenario before in your Search or Display Network placement campaigns?  Share in the comments!

PS: Don’t miss our PPC Blog’s Greatest Hits List, it’s got all of our top PPC blog posts nicely organized for your viewing pleasure:)

Written on June 28th, 2011 by

Movie trailer ads?  This is the key monetization area you’re pointing out analysts?

Movie trailers are not going to make Google their next bajillion dollars from search traffic.

Google needs to extract a higher eCPM from search traffic if it’s going to keep growing. Display ads can’t do it all.

CPC is for Suckers

Let’s start putting the pieces together here:

One of the biggest (in fact, highest-CPC advertiser models) is lead generation.  Think insurance, financial products, enterprise software, services offerings and the like.

If you’re Google, how do you extract more revenue from these advertisers when CPCs have already seemingly hit the ceiling?  CPC just can’t do it.  You need to think bigger.  Much bigger.

Some might say “you could go to a CPA model”.  They’ve already done that, and it’s too inefficient:  CPA requires the advertiser to actually convert that traffic.  And most landing pages and conversion funnels suck.

The Thin Edge of the Wedge: “Adwords Communication Extensions”

On the surface, letting a user request a call-back right from your leadgen search ad sounds like a great idea.  So you take your Google rep’s advice and agree not to opt out.  After all, as your rep will point out, “your competitors are already in the beta, and their CTR is 1000x higher than yours – you’re losing leads as we speak!!”

Of course, most advertisers will stay in the beta (I say “stay in” because it’s an opt-out program) with eyes wide open.  They can tell from the pitch docs and FAQ that Google is arbitraging the lead to them, keeping the end user’s actual contact info hidden via Google Voice functionality and Craigslist-esque email address masking:

Pssst: The First One’s Free

Hey, what do you have to lose: the leads are FREE!  (If you believe they’ll stay that way you need to quit this business ASAP).

Google runs all kinds of betas, but this is the most important one they’ve run in a LONG time.  It could reshape the future of Adwords as a platform.

One key here is that Google needs you, Mr. Advertiser, to participate and not opt-out.  Once your sales team gets used to “hot” leads that come in almost instantaneously from Adwords search ads, they’re unlikely to recommend you pull the plug later on.

But what Google needs most of all is for ALL of the advertisers in the top lead gen head term auctions to participate in the beta and the full rollout.

Even an idiot can see in advance that Google is getting into the lead arbitrage business here, and the leads will eventually have a cost.  You might even question the fact that there’s zero lead qualification going on here either.

But what’s going to get missed here ties back into the bigger picture:  How do you go from earning an eCPM of \$15 on a leadgen click (or even, say, \$45 eCPM from a Communications Extensions lead CPL lead fee)?

Answer: Why charge for a lead once when you can charge for it 8 times? Wow!  Now you’ve gone from \$45 eCPM on a SERPs page to \$200 +.

(Click to enlarge the horror)

One little button and now “it’s best for the user” to “compare advertisers” with Google submitting the customer’s lead information to ALL of the advertisers on that query because, you know, the customer wants to compare:)

And even better for you as an advertiser, you don’t have to worry so much about CTR and getting as many clicks as you can off of your ads because “Google gives you ALL of the leads!”  Imagine!  With Communications Extensions you get a shot at every lead Google can drive.  Too bad they also give them all to your competitors as well…

“But, but! those leads aren’t going to back out for all of the advertisers so there’s no way they’re going to keep participating in the comparison auctions”.

Advertisers are going to go “back to good ol’ CPC bidding again, screw this.”

Oh really?  Sadly, that option is no longer available as a bidding method for lead generation campaigns.  Google discontinued it before they rolled out the “advertiser competition” button.

So now here we are:  All I have to do is set a daily lead budget and Google decides when to send me “the good leads”.  In fact, I don’t even have to pick keywords anymore, let alone manage bidding on them.

“At first, the ROI was horrid and the leads were coming in completely unfiltered, but we couldnt’ go back as CPC bidding disappeared.  Lately though, their algorithms have been better at knowing when a lead is more likely to convert and so we’re scraping by, but nothing like the old days when we were better at optimizing our funnel in-house than our competitors.  Now when we complain to Google about lead quality and pricing though they just tell us we should sharpen our pencils a bit more because, hey, “the users much prefer this new model”. – Longtime Adwords Leadgen Advertiser X

Something similar was said when advertisers saw their avg CPCs go up to \$30 in competitive lead generation verticals.  Google’s job is to push the pricing envelope right to the edge of advertiser bailout, “then back it off just little bit” (Remember the “Creepy Line”?).  That’s how all product pricing works: find out what the market will bear at any given time and charge it.

Further to that point, who is it exactly that can’t pay what Google is now charging for leads?  Other aggregators and comparison engine sites perhaps?

Sounds like they need to get cut out of the lead chain as they’re not providing ‘added value’! In fact, sending leads to other aggregators would effectively be a “bad user experience”, so time to shut their Adwords accounts down, don’t you think?

So: now we’re just down to the raw providers, and all the middlemen but Google have been cut out.  Now we’re getting to the real meat on the bone: deep pocketed corporate spenders, not ‘glorified affiliates’ (as lead aggregators come to be known internally).

And you know what? This model has worked so well on search, Google announces it’s rolling out to the Display Network as well: Your display ads will now have a little extenstion on them that will allow the user to ask for a call-back. (This may already be happening BTW.)

Whoever has the user’s attention has all the leverage.  Advertisers are plainly being told this right now via the Communications Extensions beta.  This is no longer your customer.  This is Google’s customer.We will protect our customers’ contact data, and you will not see it.”

Interestingly, but surely unrelated, right around the time this beta was being floated, Google took away the ability for advertisers to put phone numbers in their ad headlines or sitelinks because users would apparently be confused, expecting a phone number to act like Skype right off of the Google SERPs rather than a phone number you would dial with a telephone?

Google has have enough ads to run against enough of head queries that organic results are less and less necessary.  Now they can funnel the customer directly through to Google properties and capture their actions, simply reselling them multiple times to advertisers who have no  choice but to ‘pay to play.’  This is all without even considering the ramifications of Google Advisor.

The Spoiler

Of course, we can only speculate as to how far Google will go to monetize their search results.  If recent history is any guide however, the envelope will get pushed right to the edge.  How many of us would have predicted this five years ago:

The spoiler in all of this for Google however is governmental regulation.  Even as recently as last week US and European government agencies have made it clear that they have a problem with competition getting shoved off the end of the envelope.

Final Thoughts

If Google has done the work of earning the user, and if the user trusts Google to handle negotiations for them in selecting vendors for products and services, then good on Google.  Lead-reliant advertisers just need to carefully think ahead about where this marketing channel is heading and what their plan will be when it finally gets there.

Inside the New Google Display Network Performance Metrics

Written on June 15th, 2011 by

Some clever eyes spotted this as early as late last week, and yesterday Google officially announced it:  You can now see your “Relative CTR” compared to other content ads (text or display ads) shown in the same ad spots on the same content network pages.

Google also now says that your ‘relative CTR’ is a ‘good indicator of your content network quality score (not that that’s a big surprise though, we’ve always pretty much known content QS was driven by CTR relative to other advertisers’ ads in that same ad spot).

How to View Your Relative CTR

You can view your “relative CTR” rating at the campaign or adgroup level. To see it, go to “Customize Columns” and check the box to display it. This works in the All Campaigns screen as well as when you drill into a specific content-only campaign:

To evaluate these numbers, HIGHER IS BETTER.  Anything below 1x is “below avg” and will likely have fewer impressions that “above average” 1x adgroups.

So if my relative CTR is 2.3x, I have a 2.3 times better CTR for that adgroup than my competitors.

If my relative CTR is .8x, I have a 20% worse CTR than the average CTR for that adgroup.

How To Use This Data

Now you can clearly see with it which adgroups desperately need new ads: ads that can get a relative CTR above 1x to bump out your competitors. Work on new ads for these right away, and evaluate your relative CTR for that adgroup daily until you get up over 1x. Then keep going to improve even more if you want to really lock your competitors out.

If you use the date selector to look at a longer period of time (say the last 30 days) you can get an idea of how the competitive landscape moves and shifts in your campaign. You’ll also be able to tell when a competitor comes up with a killer new ad that’s forcing down your relative CTR, reminding you to go check the ad out on your top content placement pages and see what’ they’re doing and beat it:

Impression Share % for the Display Network is Also Back

Google has shown you your campaign’s Impression Share % column for a while now, but for Search campaigns only.

A while ago a similar metric appeared for display network only campaigns, but then disappeared.

Google is now showing Impression Share % again for display campaigns. This shows you how much of the total display ad or content ad pie you’re getting for your campaign.

To enable it, on your All Campaigns screen, click “Customize Columns” and check the box for the “Impression Share” column. You’ll then see it likeso:

Overall, we’re seeing a lot more information on what’s happening behind the scenes in the display network auction: very cool. Prior to this you just had to make assumptions about what to tweak and rely on fuzzy metrics like avg position and actual CPCs.

Out of interest’s sake, in my top content campaign that gets around 50 million impressions a month, all of my relative CTRs are over 2x, which might be why that campaign has 73% impression share.

One More Thing…

This feature isn’t live yet for all advertisers, but should be by the end of July.

In what ways can you envision using this new data?  Share in the comments!