Category: Google AdWords

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Get the AdWords Time Machine Cranked Up Again

If you are in this business, you’ve heard it too… “I used to have such great results on Google AdWords back in 2006. Why can’t you just roll my account back to those settings. Surely I will get more clicks and activity at a cheaper price!” There is no time machine that can turn back the clock to give you clicks and performance that you used to have in the past on Google AdWords.

Here are a few changes that I have seen in the last eight or so  years that have impacted advertisers on AdWords. I will only list ten, but you can leave a comment with the ones you have seen too.

  1. Introduction of the quality score based on your keywords, ad text and landing page.
  2. Highly competitive bidding from new advertisers bidding on your keywords pushing up the market price per click. In one year I saw a 33% increase in click costs.
  3. Increased use of technology to manage bidding from specialized programmer interfaces. AdWords now has many of these tools available to use as rules in accounts, but before only the big companies with special programming staff had access.
  4. Tremendous variety of ad choices from text ads to video ads. We used to only have one choice text ads on Google.com.
  5. Proliferation of the publisher network through AdSense. There has been an improvement in the publisher network, but it has been pretty awful and rife with fraud previously before Google wised up to the issue of robot ad clicking.
  6. Issues of using trademarks in your ad text and keyword list. It used to be you could use them and then trademark owners have gotten very testy of even demanding you remove them from your keyword list in the US even when Google says you don’t need to go that far. In some cases, it has made it impossible for some legitimate businesses to promote their product and service on AdWords. I know of several specific cases.
  7. Google AdWords providing account set up and management services directly to businesses and putting themselves in direct competition with firms such as my own. Remember when they did this in the early days of certification.
  8. Instituted a program to certify account managers. I managed AdWords before there even was a certification program. I’ve seen the tests be tough, easy, and they are tough again. I’ve even had people ask to pay me to take the test for them. No I haven’t done that, I am offended to be asked to do so, as it hurts the professional credential I work so hard to keep.
  9. Introduction of TV, newspaper, and telephone into AdWords. We don’t have the option to buy AdWords ads in print newspapers, but we used to. Telephone started out as a totally different beast and only to a few select advertisers. Remember the green click to call phone icon. I like the new phone integration much better and am getting great success using it for my clients.
  10. Remember the early days you could create AdWords ads and target your Google Places page all from within the control panel. I liked that much better than AdWords Express. There was better control, but we cannot do that anymore.

These are just a few of the changes that I personally have seen. Each one has had an impact of advertisers as AdWords has matured into the vibrant ad platform that it is today. So sorry, there simply is no going back what AdWords used to be it has morphed over the years into a very cool, high tech valuable tool that will drive sales and website traffic. It is much more complicated but more powerful than it was before. With this power comes significant market acceptance and competition for the available clicks, sorry, but that’s progress.

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Reviewing Ad Profitability: ROAS – Metrics Part One

ROI also known as ROAS (Return on Ad Spend) is just one important metric to monitor to make sure your AdWords advertising plan is working for you. The formula for ROAS is shown below:

((Sales less AdWords Spend) divided by AdWords Spend) times 100

This yields a percentage that is an important figure to keep in mind when you evaluate if a Google AdWords budget is working properly to yield a return for your business.

If your ROAS is above 1% you are creating more sales than your expense to advertise. Here’s and example. A typical sale generates $4,800 of income. You spent $400 on AdWords to generate the sale, your ROAS is 11%. If your typical sale generates $4,800 of income but you spent $1,400 on AdWords to generate the sale your ROAS is 2.42%.

The subjective part comes when you try to analyze what is a satisfactory number for your ROAS figure. This varies for each business. For most businesses you really should be at a number higher than 1%.

For businesses selling products online, the ROAS is fairly straight forward, but how about when you sell a service or are looking to add a new patient to your practice. In this case, a review of Cost Per Acquisition may be more valuable tempered with a review of ROAS as well. The key is to generate more sales than it costs to advertise to get them. This takes much more analysis than just running reports in Google AdWords,;you really need to measure your AdWords ad spend against reports on your company’s overall profitability to determine if AdWords is really working for you.

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How Do You Know How Much a Click Will Cost on AdWords?

So you want to try AdWords, but want to make sure you will get performance. You understand you need a high enough maximum cost per click to be in the auction and your daily budget needs to be high enough to support your maximum cost per click to get AdWords to serve your program, but how do you estimate for planning your cost per click to see if you can even afford AdWords?

Google AdWords has a tool that will allow you to see estimate cost per click figures. You can visit the tool here. If you have an AdWords account when you click the link, AdWords will send you to the tool page within your own account so you can benefit from your own account history. What I recommend with all new potential AdWords advertisers is to run a few keywords that they consider important to their business to get an idea of where the bid auction is to that an effective and practical monthly click budget can be set.

Make sure that when you use the tool that you select in the drop down menu for columns the “Approximate CPC”. Remember this is an approximate. In my experience is has even been on the low side. The figures you will typically see will be for the United States by default if you are in the US, but make sure that you are not seeing global results. You can reorder the data with your selections. The local search column is not to be confused with “local” like in your region. Local in this case means your entire country based on your initial tool settings.

Do not budget your AdWords program based on the numbers you see in the tool. Remember every chance you have for a click once your program is running will be based on an auction. The figures the tool gives you should be considered a range and the real costs will typically be higher.

Once you have an estimated cost per click, then factor in how many realistically priced clicks you want per day to try to achieve your marketing results. You may find out that your budget of $2,000 per 30 days you thought you wanted to spend will simply not be enough when your click cost may be $10 per click. Additionally you may have felt you wanted to run 6 ad groups but can realistically afford only two to run or you will parse your budget between too many programs.

Although AdWords says you can set your 30 day click budget and maximum cost per click to anything you want, they also have the option to not serve your program if your settings are simply not competitive in your marketplace.

For more AdWords help, make sure to visit our website to read about our AdWords management services.

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Is Your Daily Budget Keeping You Out of the AdWords Auction?

Not only is your maximum cost per click a factor in deciding if you are in the Google AdWords auction, but your daily budget may be a factor keeping you out! It is important to understand a few things first. AdWords account managers will talk about your 30 day budget spend, and it needs to be high enough to support your accounts daily budget based on your maximum cost per click. Not your average cost per click, but your maximum cost per click.

Here is a fine example of a client who by having a low 30 day click spend has effectively kept Google AdWords from being able to serve his account for best performance.

30 day click spend $150
Daily budget $5
Typical max. CPC for other clients in the same industry $6.50
His maximum CPC based on his daily budget $5

As his maximum CPC is constrained by his daily budget, can never be set at a level to truly be in the auction, he gets spotty click results and sometimes Google cannot even spend his $150 monthly budget.

In scenarios like this what we see happen is that an account manager gets desperate and starts adding broad match keywords to an account in an effort to get low cost traffic. Here are some of the results we then see when that happens:

30 day number of impressions 11,930
Clicks in 30 days 36
CTR in 30 days .30%
Average position 6.8

It looks like the account is performing, but look at the impressions. They are high and the CTR is low. This account is getting clicks, but they are typically poor quality and untargeted clicks because the client has set the daily budget too low and so can never raise the maximum cost per click to get in the keyword auction.

This is just one example of problematic account performance. In some cases as you monitor clients such as this you will even see Google saving up money to try to serve their program by even going a day or three without any clicks at all and then getting a few clicks a day or so later.

If you are looking for a savvy AdWords manager we invite you to read our client reviews. We resolve AdWords problems all the time and do work in some cases on an hourly basis to help re-mediate AdWords problems.