Knowledge is the Foundation To Success  

Google AdWords News: 

Several of my clients have been notified that they will be included in the new Google AdWords BETA test called “Smart Positioning” which started October 1st.

The goal of Smart Positioning is to place an ad in the most cost-effective position each time it is displayed on Google and the search network, with the end goal of achieving more clicks for the same total cost. Now, it is based on an auction model that does differ slightly from the current auction model, and this is one of the reasons why it is still a BETA feature that is only open to a limited number of accounts.

At first glance, Google AdWords Smart Positioning may seem very much like the position preference settings already found in the Google AdWords campaign settings, however there is a big difference. Smart Positioning calculates incremental CPCs to evaluate the effects on cost and click through rate that would be associated with a higher position for your ad. Once the system determines the incremental CPC for placing your ad in a higher position, it compares the incremental CPC to your maximum CPC bid. Your ad is then placed in the highest position possible, as long as both the actual CPC for that position and incremental CPC are less than your maximum CPC bid. Position Preference simply limits the positions where your ad is displayed without any evaluation as to traffic, incremental cost, and/or benefit.

If you choose to enable Smart Positioning in an existing Google AdWords campaign, Google suggests a one-time increase of your maximum CPC bids that is based on the historical performance of your campaign. New campaigns with Smart Positioning can be launched with whatever bid desired, however Google recommends setting a slightly higher bid than you would otherwise use. It sounds like the extra headroom helps the feature perform better.

Even though Smart Positioning does seem like a great way to test a more automated method to control and optimize bids, I am recommending that my eligible clients do so only on a limited basis. BETA tests are notorious for having difficulties and issues and I would never suggest jumping into this situation with a campaign that is already performing well. It would be best to create a new campaign with a limited budget designed specifically to test this feature in your account.

If you’re interested in learning more about Smart Position and how it may impact your Google AdWords Campaigns, contact a PPC Management specialist today.

Clients, especially new clients, will ask me how much it might cost to be in position one or in the top three on Google. And while they might not like it or think I’m trying to hide something, I really can’t tell how much it will be to be in a certain position. And one of the main reasons why is because of the Google AdWords Quality Score, a dynamic metric assigned to each of your keywords. Quality Score can affect your CPC, your max bids and your position relavtive to your competitors

With a new account, because there’s no history for Google to look at, it may cost more to have a higher position. Over time, as you accrue data, your CPC may go down, but that will depend on your Quality Score. The lower your Quality Score, the more you may have to pay to maintain a position. Sometimes it’s hard to get clients to understand that landing page quality and load times, as well as advertising on relevant keywords, can have a big impact on their bids and their position.

Google has been making the Quality Score more transparent, which is going to be helpful in talking to clients about these criteria. But first, a definition and a little history on the Google Quality Score. According to Google, “Your Quality Score reflects your keywords CTR and the relevance of your ad text and landing page. Keywords with high quality scores are more relevant for users, more effective for your ad campaigns, and have lower cost-per-clicks (CPCs).”

Google first came out with a grade of Great, OK and Poor. Great was, well, great!; OK was middle of the road but not necessarily a bad place to be, and Poor, which usually meant your keywords would go Inactive (not showing at all) unless you bumped your maximum bid to a higher level, from $.50 upwards to $10.00. The problem with this system is that you had really no idea what was wrong because no additional information was given. Did Google hate the landing page, was the keyword considered irrelevant, was the load time on the page considered horrible, was the Google history on this keyword throughout their system so bad that wouldn’t serve these ads at all? We had no clue and no way to help our clients, other than experience and gut instinct.

Then Google added a little magnifying glass next to the Quality Score which allowed you to see a little more information – Keyword Relevance, Landing Page, and Landing Page Load Time. If Google felt that one of those items was lacking, they might tell you or they might not. It just depended. Plus I always felt there should be a Score of Good, somewhere in between Great and OK.

Last month, Google posted a message about changes coming to the Quality Score information, which would happen slowly through some Google customers. In the the next few days that change will be universal through all Google AdWords accounts. We’re seeing it now in the majority of our clients, and it’s very interesting. There’s three main changes that I see:

1. There are no more “Inactive Bids.” There’s now a message that says “Bid is below first page bid estimate” with a dollar amount that shows what Google recommends the bid be at to show on the first page. I totally loved the bid estimates for some of my clients’ terms. Granted they’re not the most targeted keywords, usually due to the insistance of a client that they need to be advertising on terms that they have no landing page or information on their website about, but $49 to be on the first page seems a bit excessive, in my book, especially when their average position for this term month-to-date is 4.0, but we’ll see what happens.
2. The data in the Quality Score column can change based on the range of time you look at. Google now calculates the Quality Score at the time of each search query. There’s a message in the Keyword Status column that says “Ads rarely show due to low quality score” when I look at the Today date range, but it just says Active when I look at past data. It’ll be interesting to see if that message changes based on the amount of data Google has to look at.
3. The Quality Score grades of Great/OK/Poor actually have a little more meaning. On a scale of 1 to 10 with 10 being the best and 1 being horrendous, Great is from 8 to 10, OK is from 5 to 7 and Poor is 1 to 4. It tends to be more helpful on the Poor and OK grades, in that if you have a 1/10 rating, you know you’re really, really Poor, as opposed to almost OK if you’re at a 4/10.

This information will help us make better decisions on what to do with certain keywords, particularly poorly performing keywords. And I think it will come in most handy because I’ll be able to give my clients more information about a search term and how it’s doing or why a bid is so high. And hopefully they’ll understand how important landing pages that are relevant to the search terms and ads that we create really are. There’s a synergy between the three that sometimes clients have a hard time understanding, and this additional transparency from Google on the Quality Score can help me have hard data numbers that may clarify this for them. It could also cause more “data analysis paralysis” as I blogged about last time, but only time will tell.

I love PPC management, and a huge part of that job is looking at my clients’ PPC data and making decisions based on what’s happening in the account. But sometimes you can get so overwhelmed by the data that it’s hard to know what to do. One of the owner’s of JumpFly calls it Analysis to Paralysis.

Data is good, data is important, data is what you should be looking at to make decisions based on what’s best for what’s going on in your account. But there are some things to keep in mind when you’re looking at your PPC data.

1. Nothing stays constant over short periods: a keyword that performs well one month may tank the next month and rebound the following month. Looking at too small of a time frame of data can really hurt you in the long run. Make sure you look at the keyword and its history over time.

2. Make sure to have enough data to make a good decision: having enough data is easy when you’re talking about search terms that gets hundreds of clicks a day. But what do you do when a search term might get only 10 or 15 clicks per month? You give it time. And unfortunately, there’s no hard or fast number of clicks or amount of time that you need to give to a search term to see if it works.

3. Look for trends but don’t spend so much time looking that you lose your mind: you know that old adage, “When you can’t see the forest through the trees?” That’s particularly true with PPC. Sometimes, if you spend so much time immersed in the data analysis, you can’t view your PPC campaign objectively, which makes it harder to make decisions.

4. View your account objectively: No matter how strongly you believe that a keyword should work, if the data proves otherwise, lower the bid or turn it off. For example, you’d think that for a company that sells golf shoes, the keyword “golf shoes” would be a great term. Actually, it’s not. People who search “golf shoes” tend to be in the research phase of their search, not the buying phase. So “golf shoes” spends a whole lot of money, but converts only rarely. This also includes the area of “ego bidding,” which is bidding high on keywords just so you can be number 1 for that term, regardless of the payoff.

5. Make sure you can track conversions: if you are an ecommerce site, looking for lead generation, selling services, no matter what you are doing, with very little exception, you MUST have conversion tracking in place. Conversion tracking, especially for ecommerce companies, is incredibly important. If you sell online and you’re average order is $47, and I can’t tell how much it costs for you to get that conversion, then I can’t tell what words are producers and which are money suckers. Conversion tracking lets me get you the best ROI possible – if a search term spends a lot but rarely converts, I can put that money someplace where it will payoff. I’ve had a clients how have told me that search terms don’t or won’t work without even trying them, just because they “know.” How do they know? Even if you’re a service company, you need conversion tracking – if you’re average service is $200, and it costs you $150 to get that lead, is that cost effective?

6. Test, test and retest: if something doesn’t work once, it doesn’t mean it won’t ever work again. It might work if you used a different landing page, or tried a lower position or tried site targeting.

All these items above rely on data analysis to know what works and what doesn’t, but remember, don’t get so caught up in the analysis that you forget to step back and look at the account as a whole.

Something New in the Data:  Google now separates data Search from Content.  Read the Google Blog for more information.