Catalyst Search Matters Search Marketing Blog

The Search Engine Marketing Professional Organization (SEMPO) recently released its annual industry survey and it includes some truly remarkable findings. One such finding is that spending on paid search marketing was approximately $8 Billion (U.S.) in 2006 and that number is expected to double over the next five years. This is obviously a testament to the value that paid search marketing can provide, but it also begs some key questions. Am I getting my moneys worth from my paid search campaign? Is my campaign producing a positive ROI? Should I spend more, or less?

Businesses of all shapes and sizes have jumped onto the paid search band wagon in a big way. Why? The answer is plain and simple, paid search marketing works. It can drive herds of visitors to your website. It can help develop brand awareness. It can improve sales, and so much more. But it can also be a big sink hole for your marketing budget if you don’t pay close attention to the results you’re getting.

Like any marketing expense, the value of a paid search marketing campaign should be measured in terms of its return on investment (ROI), and not in terms of the number of impressions your ads receive or the number of visitors the campaign produces. In the paid search marketing world, the number of impressions your ads receive is inversely proportional to the success of your campaign. If nobody is clicking on your ads, you’ll get lots and lots of ad impressions. On the other hand lots and lots of clicks isn’t necessary a good thing either. Untargeted or undesired visitors simply increase your costs. The key is to attract qualified visitors who will ultimately lead to increasing your sales numbers.

Here are five tips for avoiding the common pitfalls associated with paid search campaigns that reduce your ROI:

1. Avoid Broad Search Terms.
   For example, if you sell eye allergy medication, avoid bidding on the term “allergy”. Information seekers searching on the term allergy could be looking for a medication for food allergies, or pet allergies and even though your ad text may clearly state you offer an eye allergy medication, you will receive inadvertent visitors. More specific terms cost less and attract more targeted visitors.
2. Utilize “Exact” or “Phrase” Match Options.
   Using broad match options in your paid search campaign is nearly as bad as buying broad search terms in the first place. For example, if you bid on the search term “eye allergy medication” but set the match type to broad, then your ad will still show up when an information seeker searches on “allergy”. Setting the match type to exact or phrase match will insure that your ad only shows up when an information seeker searches on “eye allergy medication”. You should also consider adjusting your bids based on the match type settings. Visitors who come from an ad that is set to exact match are usually more valuable than a visitor who comes from an ad on broad match.
3. Utilize Negative Search Terms
   Negative search terms are used to further refine when ads are displayed. For example, if your website is about multiple sclerosis, one of the possible search terms could be “MS”. Unfortunately MS is also used in many searches related to Microsoft products, so negative keyphrases for “MS” would include “Office”, “Windows”, “Vista”, etc. Utilizing negative search terms is critical to keeping your ROI high.
4. Sponsored Search Versus Content Match
   In general, sponsored search ads (the ones that appear along the top, right side, or bottom of a search result page) generate higher quality visitors than content match ads (content match ads appear next to relevant content on a network of sites that get paid to display ads from the major search engines). Why? Because when information seekers are proactively searching on information, they are more engaged in the information discovery process than they are when they are reading articles that may contain, but not be focused on, the subject of the search term. Since content ads run on an expanded set of websites such as the New York Times, The Wall Street Journal, etc, they can generate a very high volume of visitors, but often times these visitors are “tire kickers” not buyers, so they will negatively affect your ROI.
5. Local Search Versus National Search
   All three of the major search engines, Google, Yahoo, and MSN Live now offer enhanced capabilities for running localized search campaigns. Localized campaigns can be defined in a number of ways, including: a radius around a city, a set of states, a region of the country, etc. Localized campaigns are a great way to adjust your ad messaging by region, and they enable you to adjust your bids based on the local level of competition. To use the allergy example again, if your company sells a medication for airborne allergies, then it probably makes sense to limit your campaign to the southern states during the winter and expand it into the northern states in spring. Running a campaign for mold spore allergies in Maine in January may generate some visitors but they probably won’t be in the buying mode until spring, so you’ll end up paying for twice as many clicks.

Ask your paid search campaign manager if they are following these best practices to produce the highest ROI possible for your campaign. If they are, then you’ll be in good shape to determine if your ROI justifies spending more or less in the future. In many cases you will find that some keyphrases are producing much better results and others, but that is to be expected since every keyphrase has varying degrees of relevance to your product or website. I’ll talk more about that topic in my next article.

If your campaign manager is not utilizing these best practices, then its time to find a new campaign manager.