Four Advanced PPC Mistakes

by Richard Fergie on August 31, 2012 · 5 comments

There are some mistakes that you can’t make as a beginner; when you know a bit more about how things work you really can gather together enough rope to get in real trouble. These are all mistakes that I’ve made myself and, with the exception of one, are mistakes that I continue to make. I think I’m getting better though.

Source: techiemania.com

Not considering time/effort trade offs when optimising
These days Google are telling everyone to split mobile traffic into separate campaigns to improve performance. And this does improve performance; mobile traffic is different so segmenting it means you can set appropriate bids and use better ad texts.

The key question is “how different from the average is this segment?” For mobile the answer might be “very different” so the extra work involved in managing twice as many campaigns will be worth it.

For tablet traffic or people in Newcastle searching between 1800 and 2000 (to use a more extreme example) the answer might be “not really very different at all”. In this case it is important to consider how much time it will take to optimise for this segment effectively.

Doubling the number of campaigns, as in our mobile example, does not require twice as much work (thankfully!) and the amount of extra effort can be reduced even further by effective automation. This type of thing is what the best bid management tools are good at but the point still stands; will this change be profitable once the extra time taken to manage it is included?

Optimising for the wrong metric
PPC novices are well known for optimising for the wrong things: I think Google’s revenues would take a shareholder scaring dip if it wasn’t for all the people optimising solely for click through rate.

What many more knowledgeable practitioners don’t realise is that they make similar mistakes. Some examples of these (in increasing order of how hard they are to get right):

  • Optimising for conversions instead of revenue
  • Trying to maximise revenue instead of profit
  • Not taking into account repeat customers and lifetime value
  • Selling lots of one product whilst other lines rot in the warehouse

Because paid search is so controllable it is in quite a unique position in that the actions taken by the account manager can be quite different in each of the cases mentioned above.

I can’t say that I’m 100% there at getting this one right myself. The main barrier is a communication one and that means it is difficult to solve. People who do not work in online marketing see paid search as just another advertising channel so they communicate with whoever is running it in a similar way to how they would talk to TV or print or
something else. They do not know what PPC is capable of so they won’t tell you that the priority this quarter is to shift the weird coloured curtains so that they don’t have to be sold at a loss to make room for next season’s range.

Obsessing too much over ROI
This one could be merged with the point above but it irritates me so much when I come across it that I’m going to do it separately.

Imagine you have two friends, Billy and Bob. Billy says to you “if you give me £1 then I will give you £2 back”. Bob says “if you give me £1 then I will give you £5″. In this case the rational thing to do is to keep giving money to Bob until he won’t play the game any more and only then start giving money to Billy. Budgets are assigned to the channel with the highest ROI until another channel has a better one.

Now your friend Google comes along and says “for every £1 you give me, I will give you £1.50. But don’t sweat paying me, as long as you promise to do it within 30 days I will give you the £1.50 now”.

Google has the lowest ROI out of our three friends but the net-30 payment agreement means that we can play with Google without it damaging our cash flow. This means we can continue to bankrupt Billy as the same rate we did before even though we are also paying Google.

You need to think about return on investment when you have restricted cash flow to divide between competing projects. Do not even consider it otherwise; try to optimise for something more important instead.

Thinking tactically rather than strategically
The best piece of paid search advice I have ever been told came from Jonathan Beeston at a conference. He gave a talk on how to think strategically rather than tactically. Before that I was up to my neck in tweaking ad texts and bids to try and figure out any kind of clever way to increase PPC performance by a few percent (or at least enough to look good in my monthly report). Now I am still up to my neck most of the time but every now and then I try to rise above it and think the big thoughts: “How can I use paid search to double the size of
this business?”

Strategy work is harder because it takes longer. For someone who is used to PPC, where changes can be pushed live in minutes or seconds hearing that your idea is still in the IT work queue so you won’t get your faceted landing pages this year is a bit depressing. But good strategic work is always going to involve things other than the AdWords interface – suck it up; when it works you’ll feel great!

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{ 5 comments… read them below or add one }

Jonathan Beeston August 31, 2012 at 10:27 am

The biggest error is not being able to see the wood from the trees. I think you’ve done a great job summarising how that affects PPC management. (And don’t worry, the cheque’s in the post.)

Jayne Reddyhoff September 3, 2012 at 6:42 am

Good article! I particularly like the question in your last point ‘how can I use paid search to double the size of this business?’.

Not only is this directly valuable for your client, but in addition talking to them about this can help them to see how different PPC is from some other advertising channels. And that will help with your second point.

I have always prided myself on our business focused approach to running PPC campaigns for our clients, but I fear we do not rise above the day to day as much as we should. I’m inspired to do better!

Nick Hurst September 3, 2012 at 7:41 am

Good post Richard, I definitely agree with your bit about segmentation. From my personal experience you can lump tablet and desktop together and get just as good results as splitting them. But mobile most certainly has to be separate as you have said so you can target those higher posistions.

Katie Saxon October 8, 2012 at 5:04 pm

Ah gotta love the incredibly segmented and granular account – seen that a few times. While I can see that it has worked, it’s hard to push an account like that forward because it just takes so long to manage!

Aaron October 8, 2012 at 5:08 pm

I love love love the first point. All to often we’re doing stuff that we feel like we should be doing bc of best practices, but never really think about the return on effort.

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