Optimize your AdWords campaigns
Thu, Jan 17 2008
By Jonathan Oxer
Many site owners have found that Google AdWords (and the Yahoo! equivalent, "Yahoo! Search Marketing", often simply called "YSM") are very powerful tools for site promotion. Rather than waiting for web users to find their way directly to your site, they allow you to have targeted ads placed selectively on some of the millions of sites in the Google and Yahoo! ad networks.
In many ways it's similar to the old banner advertising model where site owners paid to have their banners displayed on other sites in the hope that users will click the banner to end up on their site. But both AdWords and YSM are much more complicated beasts than the old banner networks ever were, and coming to grips with them can be a bit of a headache.
Part of the problem is that Adwords and YSM are run like a marketplace: you don't just buy banner impressions for the standard going rate of $X per thousand and hope that you get enough traffic (and conversions) through to your site to make it worthwhile. Instead you have to "bid" for specific keywords, telling the ad network how much you're willing to pay to have users see your ad when they search for that keyword or view a page containing that keyword. The ad network then tracks metrics such as the success rate of your ad (ie: the percentage of people who click on the ad when it is shown to them), the number of advertisers bidding for that keyword, and how much each advertiser is willing to pay. It then automatically determines how often your ad will be displayed and how high up the list of ads it will appear.
Sound complicated? It is. And in many ways it's like playing the stock market, because the value of keywords is determined solely by how much advertisers are willing to pay for them and it changes on a constant basis. You don't want to bid too little or your ad will never be shown, and you don't want to bid too much or you'll be paying more than necessary. Get it wrong and you could easily be paying many times as much for your advertising as you need to.
What site operator could be bothered going to all that trouble? Not many! Most business owners have better things to do with their time than track AdWords statistics on an hourly basis, so they just set up an AdWords or YSM campaign and let it run unattended.
As a result there is now a huge industry of SEM (Search Engine Marketing) consultants who will manage your AdWords campaigns and continually tweak them to gain the best advantage, letting you get on with business. Think of it as having a stock broker looking after your portfolio to maximise your return.
But unless you're running a fairly significant AdWords campaign an SEM consultant is probably beyond your budget - it would cost more than you'd save by the increased efficiency, so it's better just to accept that you're paying a premium for your ads and get on with life.
However, things have just got a lot easier with the official release last week of a new tool from Google. It's called Conversion Optimizer, and it's available to all AdWords customers with conversion tracking enabled who have received at least 200 conversions in the last 30 days.
Conversion Optimizer analyses your existing AdWords campaigns and factors in historical performance along with data about the keywords you are bidding for, and then calculates the optimal CPC (cost per click) bid for each auction to provide you the best possible return on investment for your ad campaign. It's entirely automatic: the only thing you need to do is specify a maximum bid limit, and the tool will do the rest. Rather than managing your adwords campaigns by gut feel (or not managing them at all!) it's a simple matter of activating the Conversion Optimizer in your AdWords account and letting it tell you how much to bid.
Site owners who have tested the beta version of Campaign Optimizer over the last couple of months have reported huge savings in their keyword ad campaigns, in many cases dropping the amount they were paying for keywords to well under half the previous level.
Cutting your site advertising costs in half with just a couple of clicks sounds too good to be true, but unless you're an AdWords expert and your campaigns have been hand-tweaked to within an inch of their life you'll almost certainly save money and improve ad performce with this tool. And if you haven't tried keyword advertising before this could be the perfect time to give it a go.
You can sign up for Google AdWords:
http://adwords.google.com/
Yahoo! Search Marketing can be found at:
http://searchmarketing.yahoo.com/