Sep 24

PPC vs SEO

Pay Per Cick (PPC) No Comments »

Search marketing consists of two channels: PPC (pay-per-click) and SEO (search engine optimization). Both channels have advantages and disadavatages you need to consider before committing resources to either approach.

Advantages Of Google AdWords Over SEO

Minimal Impact – Most sites won’t need to make design or layout changes in order to use PPC. SEO often requires site design changes, and these changes can be significant.

Instant – Traffic can start flowing in a matter of minutes once a campaign has been launched. With SEO, traffic can take some time to build, and there is no guarantee it will arrive at all.

Pay On Performance- You only pay when you receive traffic. If you do not receive traffic, you owe nothing. SEO requires a large upfront investment with no guarantees of campaign performance. Traffic and visibility isn’t directly controlled by the SEO.

Precise Keyword Targeting - You chose the keyword terms under which you appear. This allows you to run tightly focused campaigns. With SEO, pages can appear under a wide range of keyword terms, and sometimes these terms are unrelated to your campaign. This can make campaigns difficult to measure.

Precise Tracking And Adjustment – You get instant, precise figures, and you can adjust your campaigns in real time. SEO campaigns can be adjusted, but it is time consuming, and the results of which might not be seen for months.

Landing Page Control – You decide which page search visitors see. With SEO, visitors can arrive on any page the search engine has in its index.

Region Control – You control the regions and countries in which people see the ads. With SEO, you have no control over regions or countries.

Buy Position – want to rank #1? You can pretty much buy it with PPC. SEO is hit and miss affair when it comes to ranking, and ranking for highly competitive keywords can be virtually impossible for new sites.

Control Your Budget – You can specify how much you want to pay for any given period, and you can stop and re-start campaigns when it suits you. SEO is largely an upfront cost, and the campaign can’t easliy be switched off.

Time Control - You can control when your ads are seen. SEO has no such control.

Advantages Of SEO

Given the features and flexibility of PPC, why would people use SEO?

It comes down to two things:

cost per click and trust

SEO has zero cost per click. Of course, this doesn’t mean SEO is free. SEO is time intensive, and time costs money. It can also involve third party costs, such as link buying. However, the on-going cost of a well executed SEO campaign can come in well under that of PPC, especially if good rankings are maintained.

People tend to trust the main listings more so than they trust the paid listings. The main listings receive the lionshare of attention and clicks.

In the study “An Empirical Study Of Paid Listings In Product Search And Purchase” (PDF) the researchers found users to be suspicious of paid results:

For paid listings to yield the financial results that are
anticipated by the business community, it is critical that
consumers perceive paid listings and their descriptions
as relevant to their transactional tasks. The results of this
study support previous findings that this may not be the
case, but also provide some guidance for the
development of paid listings. Participants in the study
showed a bias against paid listings in several ways. They
reported an explicit suspicion about paid listings in their
verbal protocols. They rated the relevance of the paid
listings as lower than the organic listings despite the
content of the descriptions being controlled across listing
type

However, it should be noted that eye pattern studies show both high positioned PPC and organic listings achieve significantly more attention than lower ranking listings, organic or otherwise.

The key location on Google for visibility as determined by the eye activity in the study is a triangle that extends from the top of the results over to the top of the first result, then down to a point on the left side at the bottom of the “above the fold” visible results. This key area was looked at by 100 percent of the participants. In the study, this was referred to as the “Golden Triangle”. Generally, this area appears to include top sponsored, top organic results and Google’s alternative results, including shopping, news or local suggestions.

The Advantages Of Feeding PPC Into SEO, And Vice Versa

Some of the most powerful SEO strategies blend PPC and SEO, taking advanatge of both systems.

PPC is an ideal testing ground for SEO. Typically, the SEO guesses if a keyword term is worth the time and effort of attempting to rank for that term. Perhaps the keyword term doesn’t receive as much traffic as the estimated numbers suggest. By running a PPC campaign on the keyword terms prior to implementing an SEO campaign, the SEO can get more accurate estimate of search volumes. The SEO can also test out the wording of language on landing pages to see how altering the copy to favor search spiders makes a difference to conversions.

Similarly, SEO can feed back into PPC campaigns. Because SEO casts a wide net, traffic logs can sometiems reveal lucrative keyword combinations that the research tools do not.

An SEO strategy, built up over time, should reduce the cost-per-click price of a combined strategy. If a site ranks well for expensive terms, then you may be able to switch PPC bidding away from these terms and use the funds on covering other terms.

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Sep 24

Google Bid Simulator

Google Adwords No Comments »

Google have announced a new Adwords feature called Bid Simulator.

From the Google Adwords blog:

Bid Simulator takes some of the guess work out of cost per click (CPC) bidding by estimating the number of clicks or impressions you could have received if you had used a different maximum CPC bid.

Google have also provided a tutorial video showing you how to work out your value per click, and how to use this value to maximize your profits.

This video provides a great overview of the economics of PPC bidding, then goes onto show you how to use the Bid Simulator tool to arrive at the most profitable bid.

In summary:

  • Determine your max profitable CPA
  • Determine your conversion rate
  • Calculate your value per click
  • Adjust your bids so value per click = ICC (Inceremental Cost Per Click)

This tool, whilst useful in terms of taking a lot of trial and error out of bid setting, will provide marginal benefit in areas where the keyword auction is fierce. If the auction is busy above you, then you’re still going to need to raise you bid a lot for minor increases in volume.

Indeed, some of the recommended bid prices seem very high. The danger is that some people may see this as a helpful autopilot, when really it’s just another “suggestion” tool. Be wary.

The tool is possibly most useful when there is moderate activity in the bid range. Andrew Goodman suggests that Bid Simulator might help a lot in terms of saving cash on the low side:

Case by case, it gets interesting. Take, for example, an account where you figure you’ve done a great job whittling average CPC’s down to 23 cents. Now on a lot of the keywords that you’re getting for 15 cents, you’re not doing great ROI-wise, but you’re reasonably content since the price is low by historic and industry standards, you don’t feel like risking the effort to go down to 11 cents. I think the bid simulator may be helpful in helping advertisers decide when to take risks like that. Shaving those few pennies on lukewarm keywords, across several hundred keywords and a thousand clicks a day, can add up to a lot of saved cash you can then turn around and devote to better performing keywords or channels (or simply, profitability).

Also, as it is a simulator, your actual mileage out on the real Google may vary.

Here’s a presentation on how to use the bid simulator within your Adwords account.

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Sep 24

Online Ad Exchanges – Watering Down the Water

Affiliate PPC No Comments »

How do ad networks that nobody has ever heard of create enough inventory to pull in premium advertisers? It’s simple: create it!

A recent MediaPost article was titled Half Of Ad Impressions, 95 Percent Of Clicks Fraudulent. From that article:

Many of the sites in these exchanges use multiple layers of I-frames, which further complicated efforts to track campaigns. Sites are able to hide fraudulent traffic behind numerous layers of nested I-frames, leaving advertisers blind to in-view data, according to the study.

Mpire believes the default trafficking behavior of many RON buys is to include fraudulent and well-known botted sites. Gluck writes in the study that not all marketplace or exchange traffic is bad, but rather simply includes nefarious inventory that ad networks could block, but for some reason do not.

If you are a legitimate advertiser using these networks, they are stealing your money. If you are a legitimate publisher your inventory is being priced down because it is being priced against, compared against, and often sold in a bundled package with pure fraud. Even if you choose not to sell ads in the ad exchanges, your media is still being compared against the garbage, and the garbage is driving down the perceived value of your inventory. Thus many of these ad exchanges are a perfect mixture of the tragedy of the commons and a market for lemons.

A few years ago I remember listening to a sleazy affiliate marketer talking about how mixing your traffic in with other traffic was a benefit. No wonder, as guys like him were working the iframes + pushing cookies + using bots to view pages and click ads and fill out lead generation forms. He was operating at a criminal level, stealing from whoever he could, but had yet to go to jail.

Every network that collects leads has buckets of different quality levels. SEO and search PPC tend to be toward the top, as search is pure as the snow. And then the volume guys tend to fill up quota with trash. On average the quality is good enough to keep selling it, but the premium quality stuff is being discounted by the people who are mixing junk into the equation.

In the comments section of the above MediaPost article Sylvie Chen added

When we designed a Behavioral Targeting Ad system, it was quite obvious that RON Ad networks always exhibited a higher click thru rate but very low click to buy rates. Our suspicion was that these sites had some mechanism that ’simulated actions’. When we analyzed the IP addresses, the first node was always the same, clue to either bot controlled or site controlled robot clicks.

These simulated interactions make it seem like there is some value (chalk it up to brand, or some such), but unfortunately if a bot clicks your ad that does nothing for branding ;)

How big of a hit are some publishers taking from this fraud? Well Yahoo! didn’t allow advertisers to opt out of their content network when buying search traffic, and consequently some of their search traffic was priced at only ~ 1/3 of what the same click would cost from Google. It is no wonder Yahoo! had to sell off their search assets when they were being out-monetized 3:1 on core keywords (due in part to fraudulent traffic partners). And the cost to non-search publishers in these ad exchanges is likely even greater than it was to Yahoo!, since there is so much more watered down inventory (relative to legitimate inventory) in such ad exchanges. At its worse, about half of Yahoo!’ Searches ad clicks came from search, whereas some of these ad exchanges have their legitimate inventory measured in the single digits!

This leads back to why the price of a search click is often higher than what some affiliate networks or advertisers pay for leads: because the search traffic is real & targeted, unlike a lot of robotic and incentivised traffic sources. Search converts higher, and often has a higher average conversion value.

Plus who has time to sort through thousands of fake leads each month? They not only offer no value, but they also waste time that could be spent further qualifying and servicing the legitimate leads!

Want to read the Mpire’s full report? Download it hear.

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Sep 24

Why You Must Test & Change Your PPC Bid Strategy

Pay Per Cick (PPC) No Comments »

Years ago some noted PPC experts like Perry Marshall recommended bottom fishing AdWords for deals in some competitive markets, claiming that as searchers moved down the listings they were more pre-qualified to make a purchase.

Google’s ad quality score algorithms, bid prices, editorial standards, and the competitive landscape of paid search have changed to where it is much harder to find deals with nickel and dime clicks. Google favors smaller tight lists of keywords over broad mix and match ad groups. And, in an attempt to kill off many forms of ad arbitrage, they made a decision to recycle leading ads against the long tail vs letting longtail advertisers get those clicks for cheap.

27 minutes into this video Dan Thies claims that their sales per click dropped off as their ads moved down the page.

Today George Michie published a blog entry on Search Engine Land about why position bidding wastes money, claiming that the value of traffic doesn’t vary by position (though stating it does vary by time of day and day of week).

The next time someone tries to engage you in a discussion about “finding the right position” for a particular term, remind them that the value of the traffic is measurable; but the cost of a position is unknown, and unknowable, changing based on the whims of your competition. Bottom line: don’t let your competitors run your search program.

Mr. Michie linked to a PDF titled An Empirical Study of Search Engine Advertising Effectiveness – though that statistical study focused on one advertiser in the automotive group. None of these citations should give you a clear optimal bid position strategy, but all should give you encouragement to test your market and find out what works best for you.

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Sep 24

Google Adwords Trickery – Be Relevant

Google Adwords No Comments »

On the face of it, Adwords is a pretty simple system. You bid for keywords, visitors pay per click, and the aim is to get the most visitors for the least money.

However, as anyone who has used Adwords will know, there are a number of tangles and traps, mostly designed to maximize revenue for Google.

The Google business model for Adwords must simultaneously achieve two – seemingly contradictory – goals. It must keep the bid prices high, whilst also keeping the relevance of the advertisements high. Google will not relegate relevance for higher bid prices.

Because Google Adwords works this way, this provides the bidder with opportunities to maximize value from the system, without bidding excessive amounts. One of the best approaches to Adwords is to simply “be more relevant”.

Here are five tips to help you, keeping relevance in mind.

1. How To Increase The CTR Of Individual Keywords

If you’ve got a keyword that matches the following criteria:

  • High number of searches
  • The Ad text is too general

You can quickly raise the CTR of the keyword by simply moving it into it’s own new group and writing an ad specifically for it. This makes the ad more relevant for the keyword, as opposed to getting lost in more general group. Experiment with the Ad copy until you hit the sweet spot.

2. Play To The Known, Not The Unknown

You’ve got to get your message across very quickly, and you only have a few words to do so. To make matters worse, many others links are competing for visitor attention, and the SERP results display more words than you advertisement is permitted.

So go with the familiar. Be hyper-relevant to the visitor by talking about concepts they already know and understand.

If you need to introduce a brand new concept with a test ad, you’re going to find it tough going. Instead, repeat the keyword term in your ad title, and then use ideas and concepts that the searcher is already familiar with. If your concept takes a lot of explaining, then the place to do it is on the landing page.

Focus your efforts on getting the click first.

3. Significantly Reduce Your Bid

Not getting much, if any, response from campaigns with high bids?

Drop ‘em.

This will refocus your attention on the campaigns and ads that actually do work – the terms that are most relevant to your bottom line. If you put most of your effort into what is working, rather than what isn’t, you stand to benefit more. It’s the old 80/20 principle at work. Focus on the productive, not the non-productive.

Secondly, your poorly performing words might not be worthwhile, in terms of ROI, at $2.00 per click, but might do just fine a 0.20 cents per click. Traffic numbers might drop, but so too does the cost of acquisition. If you can make that equation work for you, then it can often pay to get out of the bidding war.

4. Watch the Time

Do you monitor the time of your conversions? You should, mostly because many other advertisers won’t bother.

Use Ad scheduling to display your ads at times of the day when you’re converting the most. This technique works because chances are you’re addressing slightly different needs at different times of the day.

For example, people might not feel comfortable pulling out their credit card in the office to pay for a personal online purchase, but they will do so at home. The relevance of an ad might differ for the same visitor, depending on the context – in this case, at what time of day – they see your ad.

5. Hang Out Where Your Customers Do

A lot of advertisers have problems making the content channel work for them. But this is mostly because the content market requires more effort. The advantage are that the click prices are substantially lower.

Search on the keywords you target, and look at the top sites in the main search results. You want to make a list of all those sites that run Adsense.

Next, you need to isolate those sites where the visitor is likely to have commercial intent.

For example, if site A is about buying electric guitars, as opposed to, say, the history of electric guitars, site A is more likely to deliver real buyers. The advertisements are appearing in a more relevant context for purchasing.

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Sep 23

Google AdWords Strategy – Part 3: Other Google AdWords Strategies

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3. Other Google AdWords Strategies

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