Strategies for Optimizing AdWords Campaigns

By , October 12, 2010

I’ve optimized Google AdWords PPC-search campaigns for dozens of clients. I’ve been doing online marketing since 1997, paid search since 1999, and Google AdWords since the service launched.

AdWords strategy starts with your goal: you probably want to sell goods or services; you don’t want “visitors” or “traffic” or “leads” (though those are helpful intermediate measures to watch); you want sales dollars. I can help to optimize your campaign so that you achieve your goal — such as $5 of sales from every $1 spent on an AdWords keyword.

I will consider working on a pure “pay-for-performance” basis, for clients who can already track ROI, but most clients require a lot of setup work to establish accurate and reliable systems to track customers from an AdWords click through a completed transaction, and that work can be expensive. Invariably, my advice includes recommended changes to the client’s web site to improve conversion rates and average order size while reducing cart-abandonment rates.

If you’re not managing your AdWords campaigns based on ROI, with tracking that shows which keywords generate which sales transactions, then you’re wasting money.

Are you making the best use of AdWords features like:

  • Negative Keywords (common examples: “free,” “pictures,” “online”)
  • Differential bid rates for each keyword variation, based on performance
  • Time-of-Day and Day-of-Week Bid Management and Pausing
  • Geographic targeting and bid variations
  • Demographic targeting and bid variations
  • Exact match, phrase match, and broad match
  • Differential bid rates (or exclusion) for “Google,” the “Search Network,” and the “Display Network” (formerly called the Content Network).
  • Improving Quality Score to reduce minimum-bid rates significantly
  • Dynamic Keyword Insertion (Echoing actual search terms in your text ads)
  • Echoing actual search terms on your landing page
  • Text-ad variations (case, sequence, message)
  • Keyword expansion (long-tail )
  • Pay-Per-Call

Another strategy that can be incredibly effective is to design your text ads with the specific goal of “disqualifying” people, or discouraging clicks from consumers who will never buy. Properly managed, “disqualifying language” can allow you to double or triple your bid amounts while improving your ROI.

2 Responses to “Strategies for Optimizing AdWords Campaigns”

  1. Anand says:

    Hey Mark, Just got a question. Why do you think the ‘time of day’ bid management and pausing is important? I mean, it should not hurt even if someone’s ready to buy ‘cheap widgets’ that I am selling even if it is 2AM right?

  2. Mark Welch says:

    In theory, you’re right, but in actual practice it turns out that conversion rates differ significantly for clicks during certain intervals, and for some keywords the difference can be huge. Careful analysis can help determine whether time-of-day or day-of-week adjustments or pausing might be appropriate. In some cases, a cursory analysis might show a time-of-day effect, but then other factors will emerge as the “real problem” (for example, geographic targeting). Pausing or bid adjustments may also be appropriate for local businesses during the hours their offices are closed.

    Clients running “Pay-Per-Call” campaigns will almost always pause campaigns during hours when no staff are available to answer the phone calls, and might choose to reduce bid rates when their best sales staff are off-duty.

    If your competitors are using time-of-day and day-of-week differentials, but you’re not, then your ads will get higher position and higher CTR during off-hour periods, but your conversion rates and/or your average order size will droop during those periods. In extreme cases, most of your PPC budget might be spent during the least-effective hours, and your overall ROI will plummet, which would lead you to reduce PPC bidding, which in turn would worsen the trend.

    There’s a strong temptation to try to “find the reason” for the reduced ROI during certain hours (and often it’s helpful), but even if you can’t find a “rational explanation,” you need to make appropriate adjustments to reflect actual performance. Logically, a search for “Epson 1400 Ink Cartridge” should have the same conversion rate at all hours within a specific country, but if you measure that ROI is higher during specific hours, then you should adjust your campaigns to optimize ROI and maximize profits. (It’s also important to avoid making big decisions based on very small data samples, especially where the difference is caused by only one or a few orders.)

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