The Mistake That Hurts Most PPC Ad Accounts

Trying to do too much too soon prevents progress from happening

Default settings lead new advertisers astray

The default settings on Google Adwords do new advertisers no favors. It’s easy to make the mistake of setting all the keywords to broad match and to optimize for clicks, because that’s the way that it’s set up to encourage new advertisers to do.

If you’re an enormous company, you can afford to waste tens of thousands of dollars a month or more just figuring out how searchers are looking for your related terms and how they interact with your sites. For most people, who work for small to medium businesses with less than $20 million per year in revenue, that kind of poorly targeted spending isn’t sustainable.

The result of using a lot of broad match keywords is that, without preparation, you waste your budget on an enormous number of irrelevant search terms that are unlikely to convert at a low budget level.

Google at a fundamental business level cares much more for the needs of advertisers that spend millions of dollars a month or more. Those major brands can afford to spend inefficiently, because they often have such broad offerings that the incremental lifetime value of an additional customer is enough to justify wasteful spending.

For most people, or just major brands that want to get a real advantage over the competition, it’s necessary to be more aggressive in controlling the risk on the account.

You have to look beyond what the keyword planner tells you to bid on

What’s easy in Adwords is to use the Keyword Planner pointed to a product or service page, take the keywords that it suggests at face value, and then to put them together into ad groups that make intuitive sense.

While this can work for certain products and certain terms, in most cases, especially when the budget is tight, it’s not likely to generate results without a lot of spending and tweaking over time.

Keeping it simple to start increases your chances of keeping it profitable

Complex accounts have more points of potential failure

When budget is constrained, the account has to be positioned less aggressively at the beginning. The budget should be concentrated onto keywords that are already converting or are likely to convert due to close match between what customers are looking for and what your business is offering.

Using more qualifying language in the copy, such as price information, or using intrinsically qualified formats like Shopping ads, can help you reduce the risk on new campaigns.

Get the higher margin offerings selling first

Additionally, it’s critical to make smart choices about what you start advertising for when you have a lot of products or services available at your website. It’s easier to advertise high margin products with direct response advertising like search ads — the reason for this is that it’s much more challenging to go through the keyword discovery process to completion when you’re selling a mixture of high and low margin products. You have more margin to give up before you start making a loss on each sale from a new customer.

Customers have no idea what your margins are, and they may very well wind up preferring your highest margin items due to factors that aren’t related to the price. The point is that you have more margin to work with when you’re building the account to start with, and it’s easier to get to success. Once it’s selling, it’s a simpler process to optimize from there than it is to try to optimize ads for products that aren’t selling at all.

How to build out from early success

Start with exact match, then broaden from the keywords that convert

The goal of search advertising, for most companies, is going to be to make sales rather than to just grow traffic to your site. Because of the way that keyword match types work, it’s going to be easier for you to broaden the account at the points where it’s already converting. In that way, you can re-invest profits into figuring out other exact match and phrase match keywords that you can separate into high-performance ad groups and even campaigns of their own with separate budgets.

This differs from the typical method, which the majority of search advertisers use, in starting with a lot of broad match keywords, occasionally stumbling into something that converts, at far greater expense than a more cautious, measured, data-driven methodology.

Capture the visitor as a customer to decrease the cost of each new sale

If you think about the businesses that you’re loyal to, in most cases, you probably had to make at least one purchase before you saw the relative higher value of that merchant as compared to its competitors. People may not even realize what unique value you offer until they buy multiple items or services from your company.

Encouraging repeat engagement through social media, newsletter subscriptions, and loyalty programs will help you get more from the rest of your advertising efforts. By making sure that your company is doing this at the same time as its other advertising efforts, you can get more from the traffic that you attract, and keep a longer sales funnel running.

Risks and Returns In ‘Pure Play’ Digital Marketing Strategies

Marketing strategies that rest on a single channel of customer acquisition have become much less popular over the last couple years. There are various reasons for this: the internet is becoming more of a settled business environment, there’s more competition on every conceivable channel, and service providers like Google and Facebook have taken to charging more money to businesses who are trying to reach customers using their services.

Whereas in 2010 or 2011, a company like Zynga was able to use viral recommendations to fuel rapid growth at a low cost, changes to platform rules across all services have made it so such strategies are no longer feasible for companies operating at any scale without a carefully considered strategy and well-executed tactics.

Anyone who relied on a pure play strategy over the last several years can tell you how they’ve had a major impact to their business from an update to the Facebook Newsfeed algorithm of a Google Search update like Panda or Penguin.

If you’re relying on a sole source for incoming traffic, here are some points for your consideration:

Knowing the risks

  • You’ll see an immediate drop-off in organic traffic or a spike in your cost per acquisition without warning. It can be as quick as one day to another.
  • You can have your company or a website that you own penalized by the service, with limited recourse available.
  • The service provider that you’re working with may not be capable of adapting to changes in the sole service you were using to generate traffic.
  • Your websites may need to be restructured significantly to handle changes that you can’t control.
  • All your revenue can be shut off without warning, leading to cash flow issues.

Understanding the potential returns

  • Using one service to drive traffic makes for a simpler overall marketing strategy.
  • It can be cheaper to manage up-front.
  • It requires less learning to remain current on.
  • It’s easier to find and hire experts in a sole marketing channel than it is to find generalists with high expertise in all the channels that they use.
  • It’s cheaper to optimize traffic coming in from a single source.
  • Requires less investment in alternate landing pages and customer on-boarding sequences.

Making better decisions about your marketing mix

In general, pure play strategies have more potential returns in the short run. They can also generate superior long-term results if and only if you speculate correctly about future policy changes in the marketing channel that you’re using.

For long term management of your marketing risks, it’s better to rely on a mixture of traffic sources appropriate to your campaign goals. Unless you have reliable moles working in all the major online platforms (which is a good idea), you have to hedge your bets. Comparing customer acquisition costs on different channels by running frequent tests will also help you to increase the effectiveness of your spending.

The larger the company, and the more significant the spending, the broader the mix that generally needs to be used.