Pay-per-click, if set-up and managed properly, is one of if not the most measurable form of advertising available, online or off. If done right, it can be extremely cost effective. If done wrong, however, it can be an absolute nightmare, a literal money pit!
I’ve personally been managing PPC campaigns for 5 years now, and have managed budgets ranging from $300/mo all the way up to $300,000/mo. A recent client wanted some quick PPC optimization, and only had a budget of $500 for that optimization work. After just 5 hours of optimizing, they saw a 300% increase in their conversion rate, and a simultaneous 50% drop in spend. Triple the conversions for half the cost.
So, if you’re ready to learn the secrets of creating an incredibly well performing PPC campaign, read on!
Disclaimer: For steps 1-3, your must have conversion tracking in place, conversion tracking must be functioning properly, and you must have at least 6 months of campaign data. If your campaign does not have all three of these things, skip to step #4. Also, some of these tips apply only to Google AdWords, not Microsoft AdCenter or other outlets.
Steps 1-3 are Quick Wins, Steps 4-10 are Long Term
#1 – Pause every active keyword that had 0 conversions during the trailing 6 months and that cost you money.
#2 – Pause all but the best performing ad in each ad group. If there is only 1 ad in each ad group, skip to step #3.
#3 – Pause all keywords that fall more than 50% above your target cost per conversion (using 3 month averages first, then 6 month averages, then 12 month averages, and making sure that these pauses won’t drop overall conversions by more than 5-10%). If you or your client have not defined a break even cost per conversion, you should do that immediately and prior to starting this step.
#4 – Create keyword silo targeted, SEO optimized, conversion optimized landing pages on the target website. You should have at least one unique landing page for each and every ad group, though two would be better. Not only will this improve your conversion rates, improve your quality score and decrease your cost-per-click, but it will help your natural search engine rankings as well.
#5 – Create keyword silo targeted ad groups. There should be a campaign for every root keyword, and an ad group for every sub-keyword under that. All keywords in an ad group should contain the sub-keyword plus some.
For example, SEO would be a campaign, SEO Consultant would be an ad group, and keywords like Utah SEO Consultant, Provo SEO Consultant, and Expert SEO Consultant would all fit in that ad group. This ensures that all ads showing for these keywords will be extremely relevant for the searcher’s query when they show up.
This is also the time to define negative keywords. If you aren’t familiar with negative keywords, that’s a complicated discussion for another day.
#6 – Create at least 2 but no more than 4 ads for each ad group (using existing ad performance data as a starting point in writing the ads, if available).
For example, ads 1 and 2 should be identical except for the landing page, and ads 3 and 4 should also be identical (but different from ads 1 and 2) and point to the same 2 landing pages. So, landing page A, targeted by ads 1 and 3, landing page B targeted by ads 2 and 4. This way you can get accurate test data on 2 different ads and 2 different landing pages simultaneously. Do not test any more variations that this at one time!
Make sure to set the campaign settings to rotate ads evenly, without which your data will be skewed. You’ll need a minimum of 500 clicks on each ad before you have enough data to make a decision (though more would be better).
Once all ads have at least 500 clicks, turn off the worst performing ads and either start a new test using the winning ad/landing page or leave it alone and move on.
#7 – Once you’ve identified the perfect ad text and landing page combination for each ad group, use Google Website Optimizer to perform A/B tests on each landing page. I recommend avoiding multivariate testing, as it tends to identify correlation but not causality. Try different text, images, form designs, etc., but only one variation at once (that is what an A/B test is, after all).
Test, test, test, until you feel like you can’t improve your conversion rate any further (at which point you should hire a conversion optimization expert to improve other elements of the site beyond your landing pages, like your checkout process).
#8 – Implement Google Call Metrics on each of your campaigns (if available, it’s still in Beta). Not only will this provide more actionable data, but call metrics has been shown to improve the click-through-rate of the ads it is shown in, provides a source of free leads, and allows click-to-call functionality on mobile devices.
Technically you should also add a separate and unique Google Voice number to your website (and ideally to each of your marketing channels, since every marketing channel should have a unique funnel so you can track leads by source).
So, for example, phone # A would appear nowhere except your website, phone # B nowhere except your PPC ads, phone # C nowhere except your print advertising, and so on.
Cost per acquisition per marketing channel is the single most important metric you can track, so make sure you have tools in place to track it!
#9 – If you are currently manually setting bids or bidding by position preference, aim for ad positions 1-5. Positions 3-5 will give you the best combination of decent click-through-rates and lower cost-per-click, while positions 1 and 2 will give you higher click-through-rates but tend to have much more expensive costs-per-click. This is really up to you and your break even cost per conversion.
Assuming you have historical data, picking the ideal Max. CPC bid is simple. Set AdWords to show the trailing 2 months of data, and then use this formula for each keyword:
(Number of Conversions x Target Cost per Conversion)/Number of Clicks
The resulting number is what your Max CPC should be set to. Obviously this formula will only work for keywords that have had clicks AND conversions, so if a keyword has had no conversions simply leave the bid at the campaign default unless Google suggest otherwise.
#10 – If relevant to your niche, you might consider testing geo-targeting, demographic distribution (content network display ads only), device targeting (mobile vs. computer), and day/time targeting.
You might also see some benefit from testing automated bidding methods like Conversion Bidding (either by Max Cost per Conversion, or Target Cost per Conversion). Be careful with these though, because they can do more harm than good if used incorrectly.
Bonus – #11 – If you have content network turned on, look carefully at your historical data for that segment to determine if it is a cost effective channel for your business. For most people, the answer will likely be no, as Google’s content network is notorious for low click-through-rates , poor conversion rates and higher costs-per-conversion (though there are exceptions).
If the content network has never been on, feel free to test it if you would like, but you’ll likely have much better results just sticking to the search network.
When you’re happy with what you’ve achieved in AdWords, move on to the Microsoft AdCenter and transfer what you’ve learned over to an additional campaign there (Microsoft now delivers all ads to both Yahoo and Bing, as well as all their various properties). AdCenter tends to have lower costs-per-click, though also a much lower numbers of impressions, so it can be an effective albeit small source of additional leads.
If you need help setting up a new campaign, or optimizing an existing one, please feel free to contact us. We do not offer ongoing PPC management (with very, very rare exceptions), but we can set-up a new campaign, optimize an existing one, or train you on how to do either or.
We can also help you to set-up extremely targeted ads on Facebook, or run deals through Groupon or Living Social if that is what your business needs.
WARNING: Before you allow any company to work on your PPC, read this first! Picking a Company to Manage Your Pay-Per-Click