I think we can all agree that an online presence is indispensable for any business or organization. For many, that presence begins with a website and a Facebook page. These are great first steps in digital marketing, and both are tools that can be updated and refined over time.
The next step for most businesses is to increase visibility and engagement through paid online advertising. PPC ads are incredibly customizable, and are a huge part of respected brands’ marketing budget. Even for small, local businesses, PPC is a logical next step in growing business. In a Google search, paid ads show up first; leaving organic listings and even local listings in the dust, as you can see in the graphic below. Often, paid ads occupy the entire first half of the page, and if your customer is on mobile, they probably comprise the whole screen.
So, what exactly is a PPC ad? Well, you’ve likely noticed Adwords ads that show in the top of a Google search accompanied by the little yellow ‘Ad’ box or Facebook ads that appear in the newsfeed or sidebar of Facebook. These are both forms of PPC (pay-per-click) advertising. PPC is one of the most efficient and targeted ways to get your business noticed. And, unlike traditional ads, with PPC, you only pay when the user clicks on your ad. The concept is beautifully simple, yet there are some definite tricks of the trade to keep in mind. In the next couple paragraphs I’ll walk you through the PPC process.
Step 1: Keyword Research
Let’s begin with a hypothetical company. Say you own a shoe company in California and you want to reach customers looking for boots. You might turn to PPC ads to target those people. Step one is to determine through keyword research, the language your customers are already using to search for your product, and then use that language in your ads.
This research can be done in the Adwords Keyword Planner. If you are targeting the term “boots,” you can type this into the Keyword Planner and it will produce a list of related words and phrases (aka Keywords) to choose from. Next to the keywords, you’ll find the search volume (average searches per month) and recommended bid (cost per click) for that keyword. This is very valuable data, as it predicts whether or not your ad will appear to your target audience.
When choosing keywords for your ad, it’s important to think critically about the customer’s intentions. Most aren’t interested simply in ‘new boots.’ Or, if they are, it’s just a recreational search, not a buying mission. Serious boot customers might search for things like:
“Flat riding boots with buckle,” or
“Steel-toed leather work boots” ← Long-tail Search Terms
The keyword ‘New Boots’ would likely come with a hefty bid price, let’s say $10 per click. Whereas the more targeted searches above could be significantly less…maybe only $0.15 per click. They are obviously less common search terms (called long tail search terms), but the customer is much more ready to buy when using these very specific terms.
Step 2: Creating a Quality Ad and Landing Page
PPC is more or less a big online auction, with bidders competing for their ads to be seen. Where your ad falls in the auction is called Ad Rank. Ad Rank is a combination of two factors: Maximum CPC (Cost per click) Bid and Quality Score. Quality Score is assigned at the keyword level. The overall structure of an Adwords account is designed with campaigns at the top, ad groups located within each campaign, and ads and keywords within ad groups. When choosing keywords, it’s important to think not only about the suggested bid price of that keyword, but also about it’s quality score, which, in a nutshell, is a measure of how well your keywords, ads, and respective landing pages match each other, and how established your website is.
Most would agree that compelling ad copy is a must, however, a clear and concise website or landing pages can be extremely important in increasing your ad’s rank as well. A relevant, easy-to-interpret, optimized (read: What is SEO) website creates both a great user experience, and sends a signal to the search engine that people are finding what they’re looking for on your page.
This video from Chief Economist at Google, Hal Varian, explains in plain language how the ad auction works and the factors that determine your ad’s position.
An important pitfall to avoid in PPC advertising is buying into the ‘pay more for the ad, make more money’ paradigm. The two are not necessarily correlated. If a company is running expensive PPC ads, yet seeing few conversions, that’s bad business. As you can see in the graphic below, a company is spending a lot of money on Campaign 4, but only seeing an 8% conversion rate, which makes each conversion more expensive.
On the other hand, there can be value in bidding on broader, high-volume search terms. It is harder (read: more expensive) to win the bid for these terms. However, spending money on ads and seeing less conversions in the beginning of an ad campaign can simply be a sign of natural growing pains. Perhaps your ads are building a loyal following, and the conversions will catch up with and surpass spending.
Step 3: Constantly Adjust
PPC ads are constantly changing, because they’re driven directly by consumers (or search-engine users). The language people use is always evolving. The marketplace for a given product can be in flux as businesses open or close or change their advertising tactics. This is why the most successful PPC campaigns are also the most closely monitored.
It’s key to setup conversion tracking to see what kinds of ads are working, and adjust accordingly. Another strategy is to run comparative ads (known as A/B testing) over the same duration to see which ad attracts more visitors or produces more conversions. Staying current on how your ads are performing and how the keywords are evolving will keep your campaign competitive.
Why Use PPC Advertising?
- It’s Affordable – Many companies invest a lot of money into PPC advertising. But effective online advertising doesn’t have to break the bank. A PPC ad budget is completely customizable. Limits per day or per month can be set, such as setting a cap on spending at $5/day or $100/month.
- It’s Nimble – A PPC ad can be tweaked and tailored, in budget, audience, keywords, landing pages, and much more, and in many cases, results can be seen within hours or days, unlike other advertising formats, that can lag weeks or even months behind a marketing move.
- It’s Trackable – Many PPC platforms have all the tracking tools you need built right in. You can track everything from impressions to conversions to certain actions a user makes on your site. Google Analytics is a great tool for consolidating all of the information from the various PPC platforms you might be using.
- It Adds Diversity – The best business results come from the overlap of the three main branches of marketing (website, social media, and paid advertising). Even if all is well in the optimization department, your website might not be visible on the first page of a Google search, as that space is becoming more and more occupied by paid ads. Diversifying allows customers to find your business by several means.
Understanding the ins and outs of PPC advertising is vital to any business that wants to flourish in today’s tech marketplace. Hopefully this three step guide to PPC advertising will put you on the right track to begin or improve your digital campaign.
This is just the first in a series of blogs on paid advertising. Be sure to check back for future posts: What is AdWords Quality Score, PPC Ad Types: FB, Google, and Bing, and The Evolution of PPC.