Winning Results with Google AdWords Second Edition_1 potx

About the AuthorAndrew Goodman is founder and president of Page Zero Media, a Toronto-based search marketing agency offering full-service campaign management for paid search as well as

www.GFX.0fees.net

Winning Results with

Google AdWords

Second Edition

About the Author

Andrew Goodman is founder and president of Page Zero Media, a Toronto-based search

marketing agency offering full-service campaign management for paid search as well as a variety

of related online marketing services for growth-oriented clients such as E*TRADE, Canon, Etsy, Business and Legal Reports, Canadian Tire, and Torstar Digital His blog, Traffick.com, has framed many of the debates in the industry, dating back to 1999 A globally recognized speaker (including an integral role in over 30 Search Engine Strategies conferences dating back to 2002),

he has served as Program Chair for Search Engine Strategies Toronto for the past two years His columns appear regularly in publications such as Search Engine Land, and his sound bites

frequently show up in major media, including The New York Times, The Globe and Mail, The

Washington Post , Fortune Small Business, Business News Network, and Marketing Magazine

Andrew is also a cofounder of HomeStars, a dot-com startup in the home improvement space He served as VP, Strategy for HomeStars from 2007 through 2008

For relaxation, Andrew enjoys inline skating in west end Toronto (sometimes into hostile crowds of picnickers), extreme gardening, watching the Weather Channel, and long walks on Cuban beaches He shares most of these experiences with his wife, Carolyn Bassett

About the Technical Editor

Matt Van Wagner is President and founder of Find Me Faster (www.findmefaster.com), a search

engine marketing firm based in Nashua, New Hampshire, and product architect for DEKE,

an ad simulator and quality control application for the Google AdWords DKI Ad function Matt is a member of Search Engine Marketing New England (SEMNE) and Search Engine Marketing Professionals Organization (SEMPO), and is a courseware developer for the SEMPO Institute Matt writes occasionally about the Internet, search engines, and technology for iMedia

Connection, New Hampshire Business Review, and other publications He has served as a technical editor for Mona Elesseily’s Yahoo! Search Marketing Handbook Matt holds a BS in

Economics from St Lawrence University, Canton, New York, and an MBA from Rivier College, Nashua, New Hampshire

Winning Results with

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For Bill Gates

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Contents at a Glance

PART I The Paid Search Opportunity

1 How Big Is This Market? The Rapid Rise of Paid Search 3

2 A $21 Billion Afterthought: How Google Entered the Advertising Market 33

PART II How to Play the AdWords Game 3 First Principles for Reaching Customers Through AdWords 71

4 Setting Up Ad Groups 115

5 How Google Ranks Ads: Quality-Based Bidding 133

6 Big-Picture Planning and Making the Case to the Boss 155

PART III Intermediate-Level Strategies 7 Keyword Selection and Bidding: Tapping into Powerful AdWords Features 181

8 Writing Winning Ads 213

9 Expanding Your Ad Distribution: Opportunities and Pitfalls 245

PART IV Winning the AdWords Game: Advanced Issues 10 Measuring Success: A “What’s Changed” Report 267

11 Increasing Online Conversion Rates 283

12 Online Targeting 1995–2015: Fast Start, Exciting Future 335

Index 367

vii

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Foreword xvii

Acknowledgments xix

Introduction xxiii

PART I The Paid Search Opportunity CHAPTER 1 How Big Is This Market? The Rapid Rise of Paid Search 3

Targeted Advertising vs Surplus Interruption 4

In the Beginning: Advertising on the Internet 7

Mass Marketing Inertia: Why Do the Old Ways Persist? 8

Google’s Unassuming, Yet Butt-Kicking, Beginnings 9

Search Marketing Facts and Figures 10

Size of the Advertising Market 10

Size of the Online Advertising Market 12

The Growth of Search Marketing 16

Search Engine User Growth 16

Types of Search Marketing 17

Why Pay for Search Traffic? Isn’t It Free? 22

Screen Real Estate, Location of Listings 22

Some Ads Are More Relevant 22

Post-“Florida” Fallout: Algorithmic Changes 22

Control Over Message, Navigation, Timing, Exposure 25

Noncommercial Sites and the Organic Results 26

Organic and Paid Search Strategies: Not Mutually Exclusive 27

CHAPTER 2 A $21 Billion Afterthought: How Google Entered the Advertising Market 33

AdWords Gets Its Start 33

How to “Speak Google”? 34

Google Responds 35

Predecessors and Competitors 37

Major Predecessors in Search 37

Major Predecessors in Paid Search 44

ix

x Winning Results with Google AdWords

The Growth and Evolution of AdWords 50

Early Version Challenges 50

Google as Referee: Complications of Multiple Stakeholders 52

How Google’s DNA Influences the AdWords Game 57

PART II How to Play the AdWords Game CHAPTER 3 First Principles for Reaching Customers Through AdWords 71

Through the User’s Eyes: Profit by Understanding Searchers’ Love Affair with Google 72

Do People Really Look at the Ads on Google? 79

Why Users Love Google 81

More Thoughts on User Intent 83

Measurable and Nonintrusive: The AdWords Difference 84

Request Marketing 84

Google Calls It “ROI Marketing” (Not “Spend and Hope”) 85

Fast Feedback Cycles and Rapid Evolution 86

Online Advertising Pricing: Why Pay per Click? 87

Self-Serve, Pay as You Go, and Self-Learning 89

A Sales-Generation Machine That’s Yours to Keep 90

Before You Start: Planning, Third-Party Tools, and a Reminder 92

Work Backwards: Assess Which Third-Party Tools Will Be Needed 92

Real-Time Auction on Keywords and Phrases 93

Billing 94

Key Metrics and Terminology 94

Impressions, Clicks, and Clickthrough Rate 94

Cost per Click, Maximum Bid, Bid Discounter, Total Cost 95

Ad Position, Bidding Wars, and Reverse Bidding Wars 99

Limit Vanity Searching Internal to Your Company 100

Conversion Rates 100

Return on Investment (ROI) 101

Account Basics 101

Structure: Accounts, Campaigns, Groups 102

Entering Basic Account Information 103

Key Campaign-Level Settings and Possible Opt-Outs 106

CHAPTER 4 Setting Up Ad Groups 115

Why Grouping Keywords Makes So Much Sense 116

Google’s Strange Advice on Ad Group Size 120

Getting Very Granular with Groups 121

Organize, Organize, Organize 122

Multiple Persons Managing the Account 122

Post-Click Tracking 123

Contents xi

Bottom-Line Performance (Ads Match Keywords) 123

Avoiding the Horrors of Overlap 124

Naming Campaigns and Groups 125

You’re in Charge: Reevaluate Structure Every Few Quarters 125

Writing Your First Ads 126

Editorial Review 127

Responding to Controversial Editorial Disapprovals 127

Quick Tips 128

Time Lags and Special Rules 129

CHAPTER 5 How Google Ranks Ads: Quality-Based Bidding 133

Encapsulating the Concept of Quality-Based Bidding 135

Quality Scores Are Based on (at Least) Three Broad Types of Data 135

Historical Data 136

Predictive Data 136

Opinion and Arbitrary Determinations 137

Paid Search Ranking Formulas: Past, Present, and Future 137

Paid Search 1.0 138

AdWords 1.0 and 2.0 138

AdWords 2.5 and 2.6 138

AdWords 3.0 139

How Ad Ranking Works: The Letter of the Law, and Beyond 139

The Goal Hasn’t Changed 139

Keyword Quality Score for Ad Ranking 140

Keyword Status 142

Landing Page and Website Quality 142

Content Is Separate from Search 143

Case Studies 143

Big Hair and Mistaken Identity: Is Google Thin-Slicing You into the Doghouse? 144

Case Study 1: Media Company, Slow “Quality Score Digout” Process 145

Case Study 2: HomeStars, Tighter Targeting and Speculation on Website Quality Issues 147

Addendum: AdWords 2.7—The Latest Development in Quality-Based Bidding 150

Fixed Minimum Bids Are Gone, Because Quality Score Is Now Calculated in Real Time per Query 150

Keywords Are Never, Technically, Inactive 151

“First-Page Bid” Offered as a Data Point 152

Quality Score Detail Intact 152

Glass-Half-Full Reaction: New Opportunities 152

What Hasn’t Changed: Strategy 152

xii Winning Results with Google AdWords

CHAPTER 6 Big-Picture Planning and Making the Case to the Boss 155

How Valuable Is Search Engine Marketing to Your Business? 155

Strategies for Small vs Large Companies: How Different Are They? 157

What about Affiliate Marketing? 159

B2B, Retail, Independent Professional, or Informational— What Is Your Business Model? 160

Business-to-Business 160

Business-to-Consumer 161

Professional Services 161

Information Publishing 163

Assess Your Sales Process 165

What’s Your Goal: Retail Sales, Leads, Registrations, Buzz, Subscriptions? 165

Cost per Acquisition, Cost per Order: Two Brief Case Examples 169

Difficulties in Forecasting 173

Forecasting Cost per Click and Click Volume 173

Forecasting Clickthrough Rates and Conversion Rates 175

An Alternative to Forecasting: A $2,000 “Testing Budget” 175

PART III Intermediate-Level Strategies CHAPTER 7 Keyword Selection and Bidding: Tapping into Powerful AdWords Features 181

How Matching Options Work 181

Exact, Broad, and Phrase Matching 181

CPCs on Different Matching Options 185

Keyword Research 185

The Google AdWords Keyword Tool 185

Keyword Research Tools and Tips 187

Keywords You’re Already Using 191

Examples of Unsold Keyword Inventory 191

Benefits of Being the Only Advertiser on a Phrase 193

Keyword Brainstorming: It’s about Them 195

Solve Your Target Market’s Problems 196

Keyword Variations: Plurals, Verb Forms, and Misspellings 199

Going Narrow 201

Keyword Progression, Initial Quality Scores, and Troubleshooting 202

Proceeding with Caution to Avoid Low Initial Scores 202

Disapproved Keywords 203

Approaches to Bidding and Ad Position 203

What Do We Know about Ad Position and Visibility? 203

Do Your Bids Have a Sensible Purpose? 205

Contents xiii

Set and Forget? Using Goal-Based Bid Management Tools 205

How to Use Powerposting to Bid at the Keyword Level 207

Making Bulk Changes Quickly with the AdWords Editor 208

Software Saves Time with Keyword-Level Tracking 209

Dayparting 209

Dealing with Foolish (or Rich) Competitors 210

CHAPTER 8 Writing Winning Ads 213

Targeting and Testing: Key Principles of Web Advertising 213

Imagine the “Perfect Ad” 213

Cater to People and Keep Yourself in the Game 214

How Your Ads Look to the User 215

Impact of Media Type and Location 215

Fitting Big Ideas into Small Spaces 216

Adopting the Right Tone 216

Addressing Multiple Priorities 221

Maintaining Accuracy 224

Getting the Most Out of Your AdWords Ads 225

A Technique for Ad Refinement in Stages 225

Getting Help from the Experts 227

Six Rules for Better AdWords Copy 228

Some Ideas for Testing Ads 233

How Split-Testing Works 233

Ideas for What Variables to Test 233

Tracking Results 240

Statistical Significance in Testing 241

Moving from Ad Content to Campaign 242

CHAPTER 9 Expanding Your Ad Distribution: Opportunities and Pitfalls 245

Getting the Most Out of the Keywords You Know 246

Deal with Your Lowest-Quality Keywords 246

Two-Word Broad Matching 248

Expanded Broad Matching: Disable Only if Necessary 248

One-Word Broad Matching + Negative Keywords 249

Advanced Technique: “Go for the Tail” 250

Building on Success: Hypothesize, Extrapolate, and Profit 252

Upping the Bid and Movin’ On Up 253

Content-Targeted, or Contextual, Ads: Take a Second Look 254

Ads Appearing near Content 254

Advanced Uses of Content Targeting: Current Affairs 258

Trademarks as Keywords (“Competitor Words”) 259

Exporting Your Successful AdWords Campaign 260

Google’s Main Competitors 260

Google Ad Planner 261

Offline Marketing 263