PPC Case Study
Renovation Company Overpaying on Their Cost Per Click Due to Unskilled PPC Ad Management
A local Winnipeg renovation company, we’ll call them “XWZ” Construction shows up in Ad Words when the term “Winnipeg Construction” is searched on Google. They are a residential renovation company, and we immediately recognize a problem that may be driving up their cost-per-click on this ad, and that may also be negatively impacting their cost per click on all the other ads running in their account.
Today in SEO and PPC the concept of “user intent” is a powerful factor which Google considers, and which therefore must be considered by site owners, PPC ad managers, or SEO specialists. Understanding user intent requires getting inside the head of the consumer to understand the nuances of what they are most likely to be looking for when they run a particular search.
Applying the concept of “user intent” is part science, part art form – it requires analytical thinking, understanding of user psychology, as well as a clear understanding of the subject matter being searched for. In this instance, when someone is searching “Winnipeg construction”, the intent is likely more aimed toward commercial construction. Someone looking for residential renovations or home building would be more likely to use terms like “Winnipeg renovation company” or “Winnipeg home builders”. The differences are subtle, yet the subtleties make all the difference when it comes to how Google ranks websites or ads (and when it comes to how much they’ll charge you per click for your ad)…
The website for XYZ Construction is very focused on residential renovations, therefore it is very unlikely to convert people (make the sale to) who are looking for construction companies – a term that implies larger scale and potentially commercial projects (and this is where a more in-depth understanding of marketing is required, to understand what leads, or does not lead, to conversions….). They should not have this term included in their ad group.
Why does it matter? Two very important reasons:
Google calculates a “quality score” for every ad you run. How much you pay per click, and how often your ad is shown (and in what position) is strongly influenced by the ad’s quality score.
If your PPC manager understands how quality scores are calculated (as every good PPC manager should), they will structure your ads to have the highest possible quality score based on the many different factors Google uses to reach that score, so that your cost goes down and your visibility goes up – resulting in much better ROI on your ads and increased ad effectiveness. One of the key factors Google considers in calculating your quality score is the click-thru rate of your ad – the percentage of times your ad gets clicked relative to how often it is displayed. Google has it programmed so that ads that get clicked a lot will get displayed more frequently, because its a signal to Google that this ad is satisfying the user’s search query and giving them what they are looking for (Ie – making for a better user experience). A PPC manager with an appropriate level of training and expertise will have mastery of effective techniques and approaches to ensure a high click through rate on your ads which will contribute to a higher quality score (and ad copy is important, but its not everything; there are other factors that would never occur to the average lay-person).
Relevancy is yet another factor that Google always looks closely at in its ranking methods, either for organic search or PPC. So if you are primarily a renovation company but you are showing up when people are thinking more in terms of commercial construction (using the search term “Winnipeg construction”), your ad is probably not getting clicked as much as others, and that’s driving down your quality score, meaning that when your ad does get clicked, you are being charged a higher rate per click by Google than you would be for the same ad if you were able to achieve a higher quality score by keeping all your ducks in a row (in accordance with all those little nuances Google is looking at when determining your overall score). Further, the quality score for a particular ad also influences the quality score for an entire ad group, and for your entire account, so its very important to work on maintaining a good quality score for all ads you are running at all times.
Another problem with running ads for search terms that dont have a very strong level of relevancy to what your landing page is offering is that it does lead to people clicking on your ad, coming to your site, and realizing you are not a match for the term they were searching, which leads them to “bounce” (they leave your site very quickly). Now you have paid for a click from a visitor who left your site right away, which unnecessarily burns thru your ad budget without bringing you a lead.
But worse yet, that “bounce” is also something google is tracking and looking closely at – when they see that visitors from that particular ad tend to leave your site as soon as they arrive there, they lower your quality score (and increase your cost per click) because they can see that your site does not give the user what they were searching for when they ran that search for “Winnipeg \construction”. They ultimately show your ad less frequently, and charge you more per click when they do show it and someone actually clicks it.
When we see a situation where someone has included a loosely relevant term when selecting the search terms they want to run ads for, it immediately screams of an unskilled, unknowlegable PPC Manager (or an amature, DIY ad campaign manager) – someone who really doesn’t understand the intricacies, complexities and nuances of the Google Ad Words ranking system and how Google calculates cost per click.
We can immediately see what happened: When you start to create ads in your Google Adwords account and enter a few terms you want your ad to show for, Google automatically starts making suggestions for related terms you *may* also want to rank for. It will create quite an extensive list, fully expecting that you will carefully edit thru the list and only use those with a high level of relevancy for what you offer (because again without that precise level of relvancy, you are going to skew everything in your Adwords account in the wrong direction and end up paying too much per click, having your ad displayed less frequently, and experience overall decreased effectiveness of Adwords.
Google does not expect for you to do a bulk upload of all of the terms they suggest to you. But this is exactly what many unknowledgable or low-skilled PPC managers or do-it-yourselfers will do – they do a bulk upload of the entire list, without editing to ensure only the highest relevancy terms (terms that really match closely the content on the page of your site you are sending visitors to). BAD IDEA! This is just one of many mistakes an improperly qualified PPC Manager or a DIY Adwords user will make due to lack of knowledge, understanding, skill and expertise in how AdWords works. There is a reason that professional pay per click specialists are continually advancing their knowledge and education on PPC through advanced trainings, courses and certifications, and why they typically spend a couple of hours a day reading up on the days PPC industry news (yes, there is such a thing) to stay on top of the latest developments and changes.
An inexperienced ad manager will look at that huge list of suggested related terms and think this is awesome – the more terms the better, right? They’ll feel like the won the lottery – Google did all the thinking for them, and afterall, if Google is suggesting these terms, they must be good terms to include, right…? (Wrong! Again, that was never what Google intended.) So they will upload the whole list of what could sometimes be hundreds of search terms. This is not what Google has in mind – they expect you to carefully go through the list, carefully considering the relevacny each of these terms in relation to what you are offering, and only select the terms that have very strong relevancy – for the reasons already explained above.
Inexperienced (or sloppy) PPC managers or DIYers don’t apply this level of discernment because 1) they don’t understand why it matters, after all, Google is suggesting it so it must be a great idea, right? Again, Google expects you to edit this list for proper relevancy, not just grab them all. 2) Editing that long list of possible related search terms provided by Google is a laborious and time consuming process, and it requires some careful thought and analysis – many DIYers or less qualified PPC managers don’t feel they have the time or simply cant be bothered to do it.
This is just one of many reasons why its very important to hire a skilled and knowledgable PPC manager with the right level of experience and expertise to run your Google Ad campaigns. To do this well, there is a lot to learn and some of it only comes with experience and a commitment to ongoing study and learning. Managing a Google Adwords campaign is really not a DIY job – its time consuming under the best of circumstances, but worse yet, you may find your ads are much less effective and are costing considerably more than they otherwise would if your campaigns were being professionally managed by someone who really knows what they are doing. Even within the world of PPC Ad Managers, its important to remember that they are not all created equal and levels of knowledge and expertise vary widely.
Want a Google Adwords campaign that truly performs and is results-driven? Talk to us about managing your PPC ad campaigns. Unless you just want to burn through your ad budget. 🙂