GAMMA PARTNERS

Maximize Your Spend, Control Your Testing

In too many accounts, we see a significant percentage of “wasted spend.” By this I mean, money being spent on advertising that has already proven itself worthless.

Testing is a part of a mature PPC account. However testing implies using a controlled environment. For example, we often come across accounts that continually run broad match or phrase match key phrases as a continual part of their paid marketing process.

If these types of campaigns are not regularly managed with continual modifications (negative match, eliminating high traffic / non-converters) they can be a tremendous drain on your budget and sink your ROAS.

Consider testing with different match types and other account variables, but manage these in separate campaigns and monitor them daily. Move “winners” into your day-to-day operational campaigns, and pause the losers. Control these tests in separate campaigns with controlled budgets, time and daily monitoring.

Don’t Ignore the Two Metrics Most People Ignore

When we audit a business’ paid search account, clients are often surprised to learn about two metrics that are very important to the success of a PPC account. The first is “impression share,” or something we call, share of voice.  Google defines impression share as the following:

“…the number of impressions you’ve received divided by the estimated number of impressions you were eligible to receive. Eligibility is based on your current ads’ targeting settings, approval statuses, bids, and quality.”

Many advertisers are shocked to learn that their ads are not being triggered 100% of the time their targeted key phrases are searched by consumers.  In our experience, budget is the biggest impediment to reaching a high impression share.

The second metric often ignored is “quality score.”  Quality score can have a big impact on your account performance. Quality score can influence both the rank and cost-per-click of your ads. While the exact ingredients of quality score are proprietary to the search engines, some of the known elements include click-thru rate (relationship of key phrase to ad), landing page (relationship of ad to landing page), and geographic considerations (when applicable).

A high quality score can minimize your cost per click and improve your paid search “rank.”  For example, you might have a lower bid than your next competitor, but your ad may be displayed higher in the list of paid ads if you have a superior quality score. Like all things PPC, continual testing of key phrases, ads and landing page variables are critical to this metric.

Understand the Channel’s True Value

A lot has been written about this.  But here is my take on it. PPC is an acquisition strategy. Businesses should be active in both branded and non-branded search campaigns, but monitoring and measuring them separately. The goal of an acquisition strategy is to bring new customers into your business, and then the hand-off is made to your customer retention program or CRM.

Many clients request a monthly report, and their eyes are immediately drawn to the Spend and Revenue columns where they imply value from. But this relationship doesn’t demonstrate the true value of the channel.  To do that, you need to have an understanding of Customer Lifetime Value.

If you have a strong CRM program, you curate your existing customers and encourage repeat visits purchases or upsells. The value of an individual customer exceeds that one time paid click vs. that one time transaction. If it is a new customer, then the value of that click is much higher. The value of a new customer from that click one-time click should reflect the average customer lifetime value of a customer. It is ultimately these numbers that need to match up against your cost per acquisition from any channel.

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Managing a paid search account is a science. To maximize its value, it requires continual testing, an understanding of how the channel fits in your customer life-cycle, and an even greater understanding of account variables, opportunities and options that can affect your performance.  It is a tricky and ever-changing medium, but when managed properly, it can have a tremendously positive impact on your business’ acquisition efforts.