Pay-Per-Click
Strategies for Search Engine
Marketers - Part 4
We continue
with our PPC special, talking
to three very experienced pay-per-click
operatives - Ammon
Johns , Andrew
Goodman from Page Zero Media and
Jim Banks from Web Diversity who
have all kindly agreed to share
their knowledge. Continued
from Part One , Part
Two and Part
3.
We pick up
this week on the topic of Pay-Per-Click
providers....
PD: How do
you decide which PPC provider
to use? What features would
you like to see PPC services
offering that they don't offer
currently?
AJ: A variety of factors have
to come into play. Much like
traditional advertising in
magazines, you ideally look
at demographics, and find the
PPC provider that can be instrumental
in getting your message to
that audience specifically
and effectively.
If your target demographic
is particularly well represented
on MSN, such as the younger
generation who use hotmail
and MSN messenger regularly,
then you may decide that Overture
is the most important PPC to
begin your campaign with giving
you the desired coverage on
MSN search. If your target
demographic were the more web-savvy,
people who own websites or
blogs, then Google AdWords
would be an obvious choice.
Google is also the choice
for those who want to run global
ads targeting a worldwide audience,
from a single interface. You
don't need more than one account
to target more than one country.
You can also target campaigns
specific to countries that
Overture et al have not yet
moved into. Want to reach an
audience in Israel, Thailand
or India? Google lets you do
so, without needing to find
and research the niche providers
in each nation.
Each PPC provider has different
partners, and this means a
slightly different audience.
The differences are not as
marked as in the off-line advertising,
but they still do exist and
can be used to increase ROI
and cost efficiency.
Of course, choosing a PPC
provider also has to take into
account the popularity of the
provider. The most popular
provider will have more rival
bidders, and thus may mean
that you pay more than you
would with a slightly less
popular provider.
Finally,
the minimum bid amount has
obvious bearing for the
smaller companies. Not every
company can afford to spend
10p per click on Overture UK.
With an average ecommerce conversion
rate (converting visitors to
customers) running at under
2%, it takes just over 50 clicks
for many sites to gain a single
customer. With a minimum 10p
bid, that means a minimum of £5
per customer. Then factor in
the popularity effect mentioned
before...
JB: I agree with most of what
Ammon says.
However, we are probably in
different camps relating to
the minimum bids and extracting
ROI.
The
numbers generally are right
and typically the cost
per acquisition might be around
the £5 mark. But, we
tend to set campaigns up on
the basis that products that
might sell for that sort of
level, would benefit from being
sold in bulk (if appropriate),
or should be bundled together
as part of a larger overall
order. The price of the product
is not the issue it's the way
you sell it. Personally if
it's macro products, that's
the sort of thing that I believe
SEO is better suited to, with
PPC you can't carry any excess
baggage on the order log.
We also chose according to
the budget. If a client has
a limited budget we might spend
more time trying to throttle
campaigns to keep within the
budget, in which case Google
Adwords might be more appropriate
as it is slightly easier to
work within budgetary constraints,
but as Ammon said the demographics
of a typical end user will
dictate (all things being equal)
the provider of choice.
Although we always stick to
the main providers, sometimes
we will bring in other smaller
providers to add some critical
mass, often to please the bean
counters that there is an opportunity
to deliver critical mass, as
well as quality. But we never
do that without being able
to track the results. I know
that Looksmart Looklistings
are beta testing using tracking
URL's but until they implement
it properly, even at 15 cents
a click we will steer clear
of that until we can quantify
the results.
Ideally we'd like to make
1000% ROI on every campaign
we run, but sometimes other
factors come into play, but
choosing the right PPC provider
to start with is a good platform,
but unfortunately, it's not
one that most advertisers go
down the road of.
Each of the main providers
have made it incredibly easy
to set things up, and to spend
money, some very clever people
have been involved in the creation
of these cash machines. The
quality of the tutorial material
is also getting better, but
sadly RTFM is seldom applied.
I think one thing we all agree
on is that PPC is another form
of advertising, and that many
of the rudiments of traditional
advertising will still hold
true. However, there are some
very extreme differences also.
I never forget meeting an
account manager of a major
UK company who was spending
significant amounts of money
on PPC and when I asked about
ROI, they just laughed and
said they were doing it as
a branding exercise, ROI didn't
count.
Well, after our discussion
he realised that EVERYTHING
COUNTS, and that even if your
not planning to sell something
directly, that you must still
measure the ROI somewhere,
be it lifetime value, newsletter
subscription leading to paid
membership, or whatever.
AG: Nice question, Peter. As
you may know it's the subject
of my next book!
I hope this book will be instrumental
in building advertiser awareness
of good and bad practices in
the PPC business, and will
act as a catalyst in promoting
transparency in the operations
of these online advertising
middlemen.
The
cop-out answer here would
be "try 30 services and
track your ROI and keep what
works." That's not practical,
especially now that there are
hundreds of phony PPC companies
who will take all of your money
and give you fake traffic to
show for it. Better to due
a little due diligence in advance
rather than waste your money
on pointless experiments --
that money could be going into
driving more clicks from the
biggest sources (Google, Overture,
and LookSmart), after all.
Most advertisers would likely
stick to a rather short list
of criteria:
- reach
- "quality of reach"
- reliability and trustworthiness (no phony sales techniques or tricky billing
practices) / experience & background of management
- fraud protection
- usability of interface / range of reporting options
- control
- customer service / responsiveness
Some slightly less pivotal
criteria might be:
- willingness
to upgrade interface & add
new features frequently in
response to advertiser demand
- innovation
- a long-term view that promotes the health of the search marketing channel
rather than turning off users
- fair but flexible editorial policies
There are many more detailed
issues to consider and some
will come down to advertiser
taste or industry niches.
As for new features that I'd
like PPC's to offer... many
of the suggestions I have would
be simple modifications of
arbitrary policies, such as
artificial bid minimums, enforced
use of keyword-pattern-matching
like Match Driver, or inflexible
editorial rules.
Most new features that I would
advocate come down to increasing
the level of advertiser control.
As a corollary to more control
by advertisers themselves,
I want to see better account
management on the back end
would allow agencies and consultants
to better manage multiple client
accounts. One key area of control
is the ability to decide what
partner sites one's ads appear
on. Google is the only major
service offering this type
of flexibility, and even there,
it's not all that flexible.
A lot of advertisers, agencies,
and consultants don't want
their ads showing up on Gator
pop-ups or other unpredictable
places. Control is what they
want - within reason, since
there is a lot of convenience
and economies of scale associated
with deploying the same keywords
and ad copy across a wide network.
So
to say it one more time,
what we want in life is very
often control over our own
destiny, allowing for the obvious
need for rules that prevent
participants in the game from
trampling one another's rights
or spoiling the medium in general.
(Remember what happened to "permission
marketing" - it got lost
in the spam.)
Insofar as PPC services place
undue weight on arbitrary editorial
decisions, and the more they
set prices and policies according
to their own interests, the
farther away we get from the
market principle undergirding
keyword advertising auctions.
Google's big shift in February
2002, moving from charging
on a fixed CPM basis to a CPC
auction program, was a giant
step forward and an example
of a company fixing a huge
flaw in its model. Publishers
and ad brokers need to resist
the urge to revert back to
fixed pricing and arbitrary
rules, since the auction model
has proven to work so well.
There remain a lot of impediments
to advertisers seeking a pure
auction, and these impediments
should largely be removed.
That being said, I do happen
to like Google's formula of
rewarding advertisers who have
higher CTR's, because it's
a way to reward relevancy,
which is the essence of search.
Google
and LookSmart are the only
true "search-centric" companies
in the space, unless you count
Inktomi. Overture recognized
this and has acquired two search
engines to shore up their competence
in this regard. It will be
interesting to see how that
works out.
PD: That's
it for this week. Next
week, the real juicy stuff: insider
tricks and tips.
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