How one easy tweak can lower your AdWords costs

AdWords Quality Score (QS) is a complex variable that is assigned to each of your keywords and ultimately influences both your ad position and your minimum bids. Exactly how your QS is calculated remains a closely guarded Google secret, but there are still many methods available that will help you improve your QS, and thus your ROI. Here's an easy one to implement that can have a direct impact on lowering your AdWords costs:

Include a link to a privacy policy on your landing pages.

The AdWords Learning Center indicates that the QS formula takes landing page quality into account when calculating minimum bids.

Furthermore, the Landing Page and Site Quality Guidelines clearly state that privacy is a factor:

"In order to build trust with users, your site should be explicit in three primary areas: the nature of your business; how your site interacts with a visitor's computer; and how you intend to use a visitor's personal information, if you request it… If you do request personal information, provide a privacy policy that discloses how the information will be used."

SEO Roundtable has suggested that lacking a privacy policy might contribute to a low Quality Score.

Quality Score improvements were also reported by Red Fly Marketing following an AdWords campaign overhaul that included the creation of a privacy policy.

It should be noted that a privacy policy is a legal document, and failing to abide by the terms you set out in it can leave you open to legal action. For this reason, you'll probably want to publish only a very general policy, unless you can have it reviewed by a legal professional.

Here's a handy tool that will generate a privacy policy for you.

The Quality Score formula is based on numerous factors, but adding a privacy policy link to your landing pages is a tweak that you can make with minimal effort, and can be an effective part of a larger strategy to lower your minimum bids. Personally, I'm a big fan of easy solutions that save cold hard cash. What about you?

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Two ways to generate more conversions

There are two ways that you can convince a prospect to follow through and act on your landing pages:

  1. You can tell the prospect that your product is the best.
  2. You can tell a great story and let the prospect come to their own conclusion about the value you are offering.

Which method do you think works the best?

Self-formed opinions are much stronger than those that need to be coaxed.

Telling a story is a craft that all PPC marketers need to hone in order to create effective landing pages. A convincing story is one that positions you as an expert, and builds empathy and trust. Two accomplish this, your landing pages need to include:

  1. A compelling reason to believe that you have the answer to the problem
  2. A free offer to justify trust

Give propects the evidence they need to come to their own positive opinion about your offering–it's much easier than trying to convince them of your greatness!

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Are Google local results cutting into your CTR?

For certain search engine result pages at Google, local results are displayed at the top of the listings alongside a Google map:

Google SERPs with Local Map Results 

I'm running some ad groups right now that according to past results should be generating much higher CTRs than they are. Curiously, the SERPs for the keywords in these ad groups are all displaying these local map results. CTR is unaffected on pages without these results.

My suspicion then is that local results are stealing focus away from AdWords ads, which in turn negatively affects click-throughs. This wouldn't be surprising: the map, pointers and star ratings are visually demanding. Once the user is finished looking at the local results, the tendency would be to scroll down, not up.

Is anyone else noticing lower CTR on SERPs with these local map results? 

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PPC is growing up

Steve Rubel initiated a discussion on his blog recently with a prediction about a looming PPC recession. According to Rubel, these are the five reasons that the PPC market will cool:

  1. Clutter
  2. Declining Relevance of Traffic/Transition to Cost Per Action
  3. Rising Costs
  4. Marketers Using Different Ad Formats (video, social marketing)
  5. Search Ads Are Viewed as Untrustworthy

I don't agree with Rubel's prediction. PPC has some maturing to do, but Forrester Research has forecast a rosy future for PPC: Interactive marketing spend in the States will grow to $61.3 billion in 2012.

Clutter will decline as marketers get better at PPC and PPC engines get better at detecting relevance. 

"Traffic is becoming irrelevant unless it results in action." This has always been true. Smart marketers are getting better and better at targeting just those searchers who are in a spending mood. Click fraud detecting technologies will continue to improve. Search engines moving to a Cost Per Action model have a steep climb ahead: if a company's fails at converting traffic, how will these engines reap any revenue?

Rising costs are due to marketers throwing client money at PPC without refined tactics. Smark PPC marketers have been going after long tail keywords for years, and this is a positive trend that will continue. 

Marketers can and will start using blogs, video, and social networks as advertising platforms. The existence of other options doesn't detract from PPC. Some will fail miserably at YouTube promotion, and find the waters of PPC a little more friendly. Variety is good for everyone–advertisers and users alike. (And, this will help with the ad clutter issue.)

Yes, search ads do suffer from a perceived untrustworthiness. That's nothing new. Google et al have work ahead to clean up this image, but in the meantime, fortunes will be made with PPC.

PPC is growing up, but it's not going away. 

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The Ultimate Guide to Google AdWords

The Ultimate Guide to Google AdWordsPerry Marshall is one of the best known AdWords experts around, so I was excited to get my hands on a copy of his book, The Ultimate Guide to Google AdWords (co-authored by Bryan Todd). My first impression was good: the book has a nice feel in your hands, it's well laid out and it's very well written. I felt far more confident about what I'd find inside this book than I did about Joel Comm's The AdSense Code.

The Ultimate Guide to Google AdWords begins with a couple of introductory chapters that can be skipped if you have some basic knowledge about PPC and AdWords. I should note that I reject the concept of "auto-pilot" PPC that's introduced on page 1 and peppered throughout the book. Because of seasonal changes, changing buying or searching habits, new competitors and other factors, a PPC campaign isn't something that can be set up and left to fend for itself. The smart PPC marketer always keeps an eye on market trends and performance statistics, and constantly expands reach by growing and/or refining keyword lists.

Chapter 3 runs through the setup of an AdWords campaign, adding tips and warning of pitfalls along the way. This is a great chapter for any AdWords advertiser to check out (even if it's just to make sure that you crossed your t's.) Next, Marshall writes about lowering CPC, and introduces the "Peel & Stick" strategy, where you remove your high traffic keywords from an Ad Group, then create a new Ad Group for the keyword along with its own ad. This allows you to get your keywords into your ad copy, which always results in higher CTR.

The next chapter is a good primer on how to squeeze more clicks from your PPC investment by properly organizing your AdWords account, using negative keywords, split testing and keyword scrubbing. This is another good read for beginner to intermediate AdWords advertisers, as is the next chapter on keyword selection and crafting killer headlines for your ad copy.

Chapter 7 goes into detail about split-testing, the AdWords advertiser's best friend. Google makes split-testing a snap and Marshall provides a solid crash course in how to put this technique to use. Marshall continues by touching on subjects such as AdSense, image ads and local ads, and follows that up with a chapter on lowering your CPC through relevance, which includes an explanation of AdWords' Quality Score. These last few sections of the book seemed slightly out of order to me. They were also very short chapters. This is when it dawned on me that there was a chance that this book had started out as an e-book or email course–it just has that jumbled, slightly less cohesive feel to it.

Marshall goes on to stress the importance of having a defined USP (unique selling point) for your campaign, but after that the book starts to stray away from the world of AdWords into the more general waters of marketing. It's all good, related info but I missed the tighter focus on AdWords. Email marketing, more on testing, converting visitors (including how to setup AdWords conversion tracking), and visitor value are all on the list before the book settles back down to more AdWords power juice: pursuasive ad copy, untapped ad copy ideas, and finally some basic how-to's for using Google tools like Analytics and AdWords Reports.

The Ultimate Guide to Google AdWords also includes a solid chapter on search engine optimization, penned by Planet Ocean's Stephen Mahaney. Again, this is not directly related to AdWords, but it's good information to have on your side nonetheless. A helpful FAQ section rounds out the book.

Overall, The Ultimate Guide to Google AdWords is a good quality book about AdWords AND marketing. Because the book strays from the tight focus of AdWords I question the title, but this doesn't detract from the quality of the information presented. In the end, The Ultimate Guide to Google AdWords is a good buy, but in my view the definitive guide to Google AdWords is MindValleyLab's AdWords Winning System. I'll review this excellent AdWords guide soon.

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Reducing PPC costs

What advertiser isn't interested in reducing PPC costs? After my last post about the benefits of setting a high daily budget, I thought it would be useful if I posted a couple of ideas about controlling costs without reducing your daily budget.

The best methods for cost control include pausing poor performing ads and ad groups, and lowering your CPC–not by cutting your daily budget. Also, try removing some of your general, higher demand keywords. These probably aren't your top converters anyway and they could be robbing your chance at better performance.

Don't rely on the obvious to control costs: the daily budget. Instead, optimize your campaign by pausing poor performers and general keywords, and lowering your CPC.

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Aim high with your daily budget

A common mistake that many new AdWords advertisers make is to set their daily budget too low. Remember, your daily budget instructs the AdWords system as to how often your ads should be displayed throughout the day. If your daily budget is low, AdWords will deliver your ads evenly throughout the day (provided you have not selected accelerated delivery), and depending on how low your budget is this could result in spotty delivery that will net only low returns. If you set your daily budget higher, you will generate more ad impressions (and more opportunity to generate leads or sales), as well as more market data to base your PPC strategies on, ensuring a more successful campaign.

There is a tendency to be stingy with daily budgets, usually driven by a fear of spending too much in a single day. This is justified, however low daily budgets simply don't generate enough data for analysis, and a key to being successful with AdWords is to test your campaign's performance by the numbers. Since AdWords follows the concept of the law of large numbers, it isn't possible to successfully analyze trends with only a handful of data, which is all that can be expected from a low budget campaign.

Instead, aim high with your daily budget! Even though it's a bit scary inputting a daily budget that feels outside of your financial reach, you can still monitor your spending throughout the day and pause the campaign if your spend is going beyond what you can afford. It's more likely however that your high daily budget won't be met.

For example, I manage a campaign where the maximum we can afford per day is $500. I get much better performance out of the campaign however if I set my daily budget at $1000. At the end of a day, my spend usually hovers around $400-500, fitting perfectly within the range of what we can afford. I monitor the account throughout the day to make sure we aren't going over budget, and if this is not something you can do, then it might be wise to stick with a lower budget. (Sorry, but the best AdWords accounts are not setup and then let loose to wander freely. Successful AdWords users have a finger on the pulse of their account activity on a daily basis.)

In the end, setting a higher daily budget will not only result in additional impressions, but will also provide you with the meaningful data you need to accurately project costs versus sales, and ultimately determine your daily profit (or loss). Knowing your average CPC and comparing it with your actual sales will allow you to adjust your daily budget and bids in an informed way, ensuring a profitable PPC campaign.

UPDATE: This information is now almost four years old so I can't speak to the accuracy of it, but check out the revered AdWords Advisor (a Google employee who provides AdWords tips & tricks in various marketing forums) on Google's calculation of the suggested daily budget. Note the daily budget optimization tip at the end: reduce the number of keywords by weeding out poor performers.

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Leapfrog ahead of competitors with bid gaps

I have an advanced bidding technique for you that will drastically improve the performance of your campaigns: taking advantage of bid gaps to increase your positioning.

What is a bid gap? A bid gap is the amount of money between two advertisers who are competing for positions on PPC search engine programs.

How can you take advantage of bid gaps? Stop rounding off your bids! When you round your bids off to the nearest nickel or dime, you are doing exactly what your competitors are doing and you're all missing out on the bid gaps. For example, let's consider these ten advertisers:

Position CPC
1st $0.50
2nd $0.45
3rd $0.40
4th $0.40
5th $0.35
6th $0.35
7th $0.35
8th $0.35
9th $0.25
10th $0.15

If you bid $0.26 cents for your ad, you would attain the 9th spot. Increasing your bid to $0.36 however would move you all the way up to position 5.

Knowing that your competitors are mostly sticking to round numbers, you can leapfrog ahead of the pack if you bid using odd numbers. It's an easy technique that can generate almost immediate results for the savvy PPC marketer.

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Click fraud: A good reason to avoid Google's content network

A new study has come out that suggests that the problem with click fraud is much bigger than what Google and Yahoo! are admitting to. This article is an interesting read all the way through, but AdWords advertisers will want to pay especially close attention to the end of the piece:

Click fraud doesn't appear to be a major problem when the ads appear on Google's and Yahoo's respective websites, Milana said. The trouble starts cropping up once Google and Yahoo deliver the ads to other websites that are part of their vast marketing networks. "They just don't know what happens beyond their own firewalls," Milana said of Google and Yahoo.

What does this mean to you? Disable content network distribution of your ads! Surely, there are advertisers who are getting great returns from their ads being displayed on the AdWords content network, but it's not for the feint of heart.

A good practice is to run some tests with content network distribution, monitor the metrics of those tests, then judge your ROI form there. This is not recommended for new AdWords users–get your accounts tuned for performance first, then experiment with more advanced techniques such as this.

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AdWords should show keywords when creating text ads

When crafting your PPC ad copy, you should be incorporating your keywords into your text. Why? Because Google will highlight in bold the keywords in your ad that match the user's search query. For example, if your ad text is:

Blue Widgets
Great Prices on Blue Widgets
Free Blue Widget with Every Order
www.BlueWidgets.com

and the user searched for "blue widgets", then your ad will be displayed to the user like this:

Blue Widgets
Great Prices on Blue Widgets
Free Blue Widget with Every Order
www.BlueWidgets.com

As you can see, the bold text really makes the ad stand out! For this reason, including your keywords in your ad copy can drastically increase your CTR.

Google has some of the world's top geniuses on staff, but I dare say that their usability department at AdWords is under performing. Along with my other recent suggestions for improving the AdWords MCC interface, I'd like to point out that Google could really improve the usability of the interface with another simple modification: when creating a text ad, the Ad Group keywords should be visible on the same page! This simple change would encourage better quality ads, since advertisers would have their Ad Group keywords right in front of them, making it much easier to incorporate them into the ad copy. As it is, I have to keep two tabs open in Firefox to create good ad copy: one for the Create Text Ad page and another showing my Ad Group keywords.

I understand that when you're looking really closely at something it can be hard to see the obvious, so I'll continue to point out these little usability tweaks to Google AdWords support, because in addition to being really smart folks they're also pretty good at listening to suggestions.

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