Recently I achieved a number one organic ranking for one of my SEO clients and was anxious to see how much additional revenue the ranking would result in. The keyword was the number three revenue generating keyword for the clients Google AdWords campaign so I had very high expectations for the new organic ranking.
To my surprise, though revenue from the organic ranking increased, it didn’t increase near as much as I expected. Yet at the same time, revenue from the paid keyword had nearly doubled. As it turns out, the paid keyword was ranking number one as well so many of the customers were clicking on the ad first, then clicking on the organic listing. Since customers clicked on the paid ad, the Google cookie attributed the sales to AdWords, yet the organic listing made the sales.
So, when you’ve achieved a number one organic ranking but you don’t see a jump in revenue from the keyword, see how the keyword is doing in AdWords… AdWords takes all the credit.
This brings up another question…is it worth the expense to rank number one in AdWords when you have the number one ranking in the organic results? My answer: it depends on what it costs to rank number one in AdWords. If the keyword is very expensive (you’re barely breaking even or have a negative ROI), I’d try reducing the max CPC. If it’s not terribly expensive (you have a positive ROI), I think its worth the expense of ranking high on the paid ads for the exposure, branding, etc.
Update: Danny Sullivan also disputes Scoble’s predictions. Thanks Danny.
If you happen to see Robert Scoble’s video on the death of Google, consider yourself fortunate. I somehow got through 1 and half of the 3 part presentation and I just couldn’t listen to it any longer.
I don’t like to bash on anyone and it’s not really worth my time to do so. However, sometimes people just need to know when someone is giving them bogus information, especially if its coming from someone who is considered an “authority” on the topic.
Well, fortunately for you, Rand Fishkin at SEOmoz wrote an incredibly long post about how Scoble has it all wrong and just isn’t making sense.
By the way, if you’re reading this Scoble, if you’re going to use a whiteboard, it might be a good idea to make it so viewers can read what you are writing. One more word of advice (not necessarily relating to this video): I have a hard time respecting your opinion when you keep talking about yourself when you do presentations.
So I just logged into my adwords account and got a notification that Google will be changing the way the CPC formula works for ad placements for ads that display above the organic results. Straight from Google:
In the current top ad placement formula, we consider your Quality Score and your actual CPC, which is determined in part by the bids of advertisers below you. Even if you have a high quality ad, if advertisers below you are not bidding very much, your actual CPC may not be high enough to qualify your ad to appear in a top position.
With this new formula, instead of considering your actual CPC, we’ll consider your maximum CPC bid, which you control. This means that your ad’s eligibility to be promoted is no longer dependent on the bids of advertisers below you. Therefore, if you have a high quality ad, you now have more control to achieve a top position by increasing your maximum CPC.
Your actual CPC will continue to be determined by the auction, but subject to a minimum price for top spots. The minimum price is based on the quality of your ad and is the minimum amount required for your ad to achieve top placement above Google search results. As always, the higher your ad’s quality, the less you will pay. And you will never be charged more than your maximum CPC bid.
So, even if you’re ranking number one on a keyword, if your bid isn’t high enough, your ad will only show up to the right. I like how I can now have control for it showing up above the organic listings but I don’t like how I have to bid more, even if my ad is the most relevant. I wonder how Google will determine the minimum bid to be placed at the top of the results.
By the way, Google says it will be going into affect in the coming weeks. I wonder how this news will be received and how it will affect my campaigns. This will be interesting.
So today we got an invitation to try out Google’s Pay-per-action (read affiliate program) and it’s got an obvious problem: the cost structure — you have to set a fixed dollar cost for an action (in most cases, a sale). This is a problem because if you have a product line with a wide range of prices, the justifiable cost per action (CPA) will vary based on the price of each product. The cost should be a percentage of the sale — just like affiliate networks do it.
With a fixed cost, I can’t figure out a justifible CPA that would attract affiliates. The only option we’re left with is to put a reasonable CPA for the majority of our products and watch it carefully. To be honest though, I don’t see this being any more effective than AdSense so if AdSense doesn’t work for you, CPA probably won’t either… hopefully I’m wrong.
Google AdWords allows you to dynacially match a searcher’s query. Aaron Wall explains it in this post. It’s definitely helpful but it’s got a couple of drawbacks to consider before implementing.
First, if you’re bidding on broad keywords like ‘dvd player’ and you sell cases for dvd players, if you use keyword insertion for the ad, searches are going to click on your ad thinking you sell dvd players… not the kind of traffic you want to be paying for. This is probably a bad example since you shouldn’t be bidding on that keyword anyway but it clearly gets the point across.
Also, regular google users can tell which ads are dynamically generated and which ones aren’t. Why does that matter? You probably already know… usually those advertisers don’t have what you’re looking for (thanks ebay, amazon, and other lazy advertisers). If you do keyword insertion, I highly recommend capitalizing the W in keyword so that all of the words in the title of the ad are capitalized — it makes it looks a little less dynamicically generated.
One good reason to use keyword insertion is to get around use of trademarks (or inability to use them). For example, if you sell iPod cases, you can’t put the word iPod in your ad but you can do the insertion code. Yet, I have seen some sites place the word iPod in their ad without using insertion. I’m not sure what it is they’re doing. Do you know?
A little over a week ago, I was shoked to log into our our AdWords account to discover that our brand keywords, terms we have registered the trademark for, were inactive because they were deemed “irrelevent” and to activate them, we had to increase the minimum CPC to $1.00. What the… ? Our site is the most relevent for those keywords!!! Needless to say, I was not impressed.
I contacted Google in an outrage. They got back saying that the ads (which showed the store name) didn’t include the keywords in them. The rep recommened creating an ad group for the store name keywords and one for the brand name keywords. In the meantime, after our ppc management company (which I’m anxious to write about and will soon) had uped the bid to $1.00 afterwhich Google imposed a minimum CPC of $5.00!!! Something’s not right here Google.
Our ppc manager called me the following day to tell me he had been on the phone with Google for about an hour. Turns out they had recently done an update to AdWords which put significant weight on the ad text and, I believe, the landing page.
Fortunately, Google credited us for the pricey keywords fessing up to the mistake.
Well, I just did some searches on the issue and it sounds like this problem has been going on for weeks. I’m surprised it took so long for us to be affected.
If you’re new to renting links, text-link-ads has a comprehensive white paper on the subject. If you’re not new to renting links but you haven’t read the paper, it has some good link building tips.
Though TLA will tell you anything to get you to buy their product, the paper is, for the most part, right on. It actually mentions other methods of building inbound links. One thing that is inaccurate in the paper, however, is how long you should wait to see results. The paper says you should wait at least 90 days… that may be the case for Yahoo or MSN, but for Google, it’s a good six months or longer for competitive terms.
It appears that google is in the middle of an update… pagerank’s are going up and down all over the net.
This tip actually applies to traffic from any channel but its definitely something you can do to improve your return on ad spend and justify your cost-per-conversion for ppc ads.
Before killing a costly adgroup, make sure you’ve offered everything searchers may be looking for when they click on your ad. For example, try selling different variations of your product… different colors, different lengths, different brands, etc. If you’re only offering one or two varieties of a product, a searcher will be more likely to go with a competitor that offers a more depth product line.
If sales to businesses make up a majority of your revenue, you may want to consider reducing your max cpc outside of business hours. Allow me to explain…
Say you have a product that you make $10 profit per sale and businesses buy five of them on average while consumers only buy one unit at a time. See where I’m going? With businesses, you’re probably making a decent profit when you’re spending less than $40 on advertising per conversion (hopefully much less to cover your other expenses) but with consumers, you don’t have as much room for advertising after your other expenses (overhead and operations).
This logic mostly applies to advertisers that sell to both business and consumers. If your product is only searched for by businesses, then you don’t have to worry about the advertising bill being run up outside of business hours.