Searchable’s Guide to Launching your First PPC Campaign!

PPC: Everything you Need to Know (& more)

I’ve been playing around with pay per click marketing on and off for around five years now. Some might say I’m still a little wet behind the ears, others will be dying to hear about my experience. PPC is probably my favourite traffic source (although I rarely turn down any kind of traffic, especially if it’s free!) – so in this article I’ve tried to share everything I know in the hope it’ll help with your campaigns.

Quick Page Jumps:

 

Glossary

Usually you’ll find a glossary at the end of a book, but for the sake of this article I’m going to put it at the very front, because I’ll be using a boat load of acronyms that are sure to confuse a few people.

CPC: Cost per click

CPM: Cost per 1,000 (impressions)

CTR: Click through Rate (Number of clicks per 100 impressions)

PLA: Product listing ad

PPC: Pay per click

ROI: Return on investment

 

Introduction to PPC:

1. High CPC doesn’t mean you have to make a loss

ppcProbably the biggest misconception I’ve encountered in the wonderful world of PPC is that high CPC means a campaign can’t be profitable. That’s absolute rubbish.

I knew a guy who loved blackhat SEO – he was sending tonnes of traffic to his dodgy insurance sites and he was making a fortune. I asked him why he didn’t dabble in PPC – to spread the risk, and remove all the eggs from one basket. He wasn’t interested: “The CPC is too high” he informed me.

If he’d said: “The CPC is prohibitively high and I didn’t get enough conversions to break even after 6 months of testing” I would have let him off. But how can you dismiss the idea of using PPC simply because “the CPC is too high” – it’s ridiculous. It’s all relative – the CPC on insurance related ads is high, that’s a fact. But the potential returns are also massive. It’s swings and roundabouts.

The first example I’m going to cite here is a car. If a garage sells a car for £10,000 and they’re working towards a 50% margin, they make £5,000 net profit for every car they sell. If it costs £5 per click from Google AdWords to advertise their cars, they need to have a conversion rate greater than 1 in 1,000 in order to be in with a chance of making profit. Some people would say that £5 for a single click is preposterous, but really it’s just a numbers game. Even if the company only gets a conversion rate of 10% from their clicks, it still only costs £50 per sale they make – which is a drop in the ocean compared to the £5,000 profit at stake. Obviously this is pie in the sky – a completely made up scenario. But it just goes to show that high CPC doesn’t mean you can’t make a profit. Just look at the insurance comparison sites paying upwards of £10 per click. Would they be doing that if they didn’t make money? I don’t think so.

2. Low CPC doesn’t mean you will make a profit 

So although high CPCs won’t necessarily mean your business makes a loss, a low CPC definitely means you’ll make a profit, right? Well, no, that’s not the case.

I’ve had two first hand experiences where I was driving PPC traffic for under £0.10 per click, but I still had a hard time in making the campaigns profitable.

The first campaign was for a tattoo affiliate product through Clickbank. Sure I could drive thousands of targeted visitors to my landing page every day, but the conversion rate in this particular niche was just a fraction of 1%. Even if I’d reduced my CPCs further I couldn’t have made it profitable. The traffic is cheap for a reason – because it’s very hard to make a positive ROI.

Another campaign I struggled to make profitable was for a cheap cosmetic product. I ran the campaign for several months before I finally made a positive ROI. The CPC was around 50p, but the profit margin on the item was only £1. That meant I needed a 50% conversion rate in order to break even, which is of course completely out of the question. Gradually I managed to increase CTRs and decrease my bids/CPCs, whilst working with split testing on page to wring out every last sale.

3. Don’t let anyone bid for you

I understand the logic behind having PPC networks do your bidding for you – all you have to do is enter a maximum bid. I just don’t trust PPC networks to get the very best ROI for my campaigns though. To that end I always set bids manually – at first I bid high to build up CTR stats, before gradually dropping bids to reduce my spend and kick my ROI into the green.

 

CTR is extremely important

CTR is a percentage figure – it’s a measure of how many impressions your ad receives, versus how many people actually click on your ads. The idea is to achieve the highest possible CTR – if you do this, your CPC decreases – PPC networks trust your ad more, and because it’s likely to be clicked, they display it prominently. Technically you could claim the top spot on Google ads, even by bidding less than your competitors.

google-ru-ppc-ctr

Analysis of CTR% Based on Ad Position in Google (provided by Neiron.ru)

Be careful not to drive unwanted traffic to your site in an effort to increase CTR. I’ve seen people add all kinds of weird and wonderful keywords to ad groups they don’t belong in. I’ve also seen people change ad copies to make false promises just to get people to click them. The only way to increase CTR in my experience is to play with your creative constantly – make them the best they can be.

For example, I managed to ramp up my click-through rate in no.1 position from 10% up to 30% CTR, as you can see in the screenshot below:

ctr

Ramping up your CTR isn’t easy – it’s a case of split testing lots of different ad copies, and pictures where applicable. It can take months even years to find the perfect ad creative that achieves a mega CTR. My advice is to start off with at least 25 ad copies per ad group, let each one get at least 1,000 impressions, then cut the ads with the lowest CTRs. You can then play around with variants of ad copy from the ads that performed well.

Most people just chuck up a PPC campaign and leave it for eternity. The truth is that a PPC campaign is never finished – you have to constantly test and tweak it to be sure you’re getting the best bang for your buck, aka ROI.

Typically people ramp up their CTR with a bidding strategy – they big high initially to get the ad to the most prominent position. As it gets clicked and CTR increases you can gradually reduce the bid. I’d advise doing this in 5p increments. If your ad falls off the top spot the likelihood is that CTR will plummet, so just put your bid back up by 5p in order to retain the CTR figure. You will hit an equilibrium point where your bid becomes too low to maintain the top spot – or a competitor could outbid you, or someone may arrive with an even better CTR than yours.

 

CPM isn’t all it’s cracked up to be

I know lots of people that rave over CPM, but in all honesty I’ve never made it work for me. Whereas most PPC networks run on a CPC basis by default (where you pay for each individual click received) – some PPC networks allow you to select a CPM option. This means you pay per 1,000 impressions your ad receives. You could get 100 clicks and you’d still only pay the CPM, or you could get 0 clicks, but you’d still have to pay.

I’ve heard lots of stories of people switching from CPC to CPM once they’ve optimized a PPC campaign. My issue with it is that ad networks tend to display your ad much less prominently the second you switch to CPM. They know they’re getting your money whether you get clicks or not – so if they can get away with demoting your ad to the depths of their pages, why wouldn’t they? They want to run off with your CPM money, and someone else’s CPC money.

Making CPM work for me has been a huge task and I just don’t think it’s worth it. The one exception to this rule is POF advertising where the only model available is CPM. My top tip for being successful with CPM is to make your creative as attractive as possible – get a ridiculously high CTR and test it using CPC, then once you’ve got a handle on what’s working well, just switch to CPM.

 

Writing ad copies 

Ad copies don’t write themselves! It’s boring, it’s annoying and you no doubt have much better things to be getting on with. That said, the copy used in your ads is probably the most important thing to be tested in order to increase your CTR.

ad copy

From experience, ad copies that ask a question get the best results – but this does vary. Instead of saying “Buy A New Car”, you could make the headline: “Need A Car?” or even something more creative like: “Tired of Walking?”.

I also ensure every single ad copy has a CTR in it: “Order now”, “Buy right away” – I try to make the ads sound urgent. I never use “today” in ad copies – doing something “today” just isn’t urgent, is it?

Obviously some networks only allow you to use text in your adverts – don’t rush them, sit down and think about them long and hard. Use a notepad and jot down some ideas. If the network you’re using allows the use of pictures you should get a good selection to work with.

When testing copy alongside images things can get confusing, fast. My advice is to try 25 or 50 images with identical ad copy. Once you’ve found the winning images you can then experiment with five different ad copies for each image.

 

Setting up ad groups 

Ad groups are really important – I like to have loads. I always try to narrow down the targeting of each ad as closely as I can. So instead of just advertising “t-shirts”, I’d create a different ad group for each brand of t-shirt that I stock. If I wanted to go one step further, I’d create an ad group for each brand and colour of t-shirt that I stock. I could go further still and create ad groups based on brand, colour.

I really can’t stress the importance of working with small, manageable ad groups. It’s amazing how some ad groups convert like crazy and others don’t. Red t-shirts might convert like crazy with a positive ROI, whereas pink t-shirts may be really unpopular, with a very low ROI. By isolating the ad groups you can see a cross section of what’s pulling your ROI up, and what’s pulling it down.

It’s boring and it’s a pain but segmenting your ads as much as possible really does reap rewards. You might see a £5 spend on one ad group results in £100 worth of sales, whereas a £100 spend on another ad group has resulted in no sales at all. If you just had broad groups it’d look like everything was “OK” and breaking even. By isolating ad groups and demographics you can see exactly what does and doesn’t convert – helping you to achieve the highest possible ROI.

Ad-Group-Ideas-Example-11-1024x590

 

Relevant landing pages

When I first started playing around with PPC all those years ago, I used to direct all traffic to my site’s homepage. That’s the logical thing to do, right? Well, it seemed so at the time.

The only way to link with PPC ads is to deeplink. And when I say deeplink I mean, if you’re advertising a Ralph Lauren t-shirt in red that’s large, you need to link to that specific product page. You shouldn’t just link to your homepage, or a general Ralph Lauren category page. You need to make things as easy as possible for visitors – take them to the page for the exact product they’re looking for.

If you don’t run an ecommerce website and you’re advertising a website that offers tattoos, don’t just take users to a general tattoo page if they clicked through looking for “butterfly tattoos”. Take them to a page containing butterfly tattoos!

This sounds so obvious, so simple – but if you go and click on some PPC ads you’ll soon see how many ads just direct visitors to any old page, expecting them to find what they’re looking for themselves. You can dramatically reduce bounce rates by getting users to where they need to be at the first time of asking – significantly increasing your ROI at the same time.

Another reason why you should segment ad groups so they’re narrowly targeted is so that you can direct users to the specific page they need. If you just target people looking for t-shirts in general then you can’t deeplink to the exact type of t-shirt people are searching for.

The only exception to the rule is “brand” keywords. So when you search for “Argos” for example, you’re taken to their homepage. The same goes for Tesco. It’s generally a good idea to compete on PPC for the name of your website, just so competitors don’t siphon off customers that are actually looking for your site.

 

Picking keywords 

Some people build keyword research up to be some ridiculously difficult task. The removal of the Google Keyword Tool has admittedly made it somewhat more difficult, but it’s still fairly straightforward. The more you practice keyword research, the more you run with keywords you’ve researched, the better an idea you’ll have as to what does and doesn’t work – the better you’ll get at picking keywords.

I could write a book on keyword research but I’m going to be brief in this section – simply put a “seed” keyword into Google’s Keyword Planner and you should see a few suggestions for keywords related to your seed keyword.

Be sure to choose keywords carefully to ensure you receive traffic that’s relevant – otherwise your ROI will be poor because you’re paying for traffic that won’t convert. For example, when you search for the keyword “watches” you’ll see all kinds of suggestions like “free watches” and “cheap watches”. If you’re selling high end watches that cost several hundred or even several thousand pounds each, it makes very little sense to target people looking for a free watch – or even a cheap watch.

Target only keywords that will bring relevant traffic to your website. Targeting people that aren’t looking for what you have on offer is a waste of everyone’s time, and of course your money.

As I’ve said before, a PPC campaign is never, ever finished because user habits and trends are always changing. Don’t be afraid to cut out keywords that are no longer profitable – don’t be afraid to experiment with new keywords either.

Match types & negative keywords

There are three different match types when advertising on networks like AdWords and Bing Ads: Broad, phrase and exact match. Here’s what they all mean:

Broad match: this is where you enter a keyword like “headphones” – your ad will then be displayed for all queries containing the word headphones, as well as related phrases like earphones.

Phrase match: this is where you can target keywords contained as part of a phrase. Again using “headphones” as an example, if you set your campaign to use “headphones” as a phrase match keyword, you’d get traffic for things like “cheap headphones uk”.

Exact match: this is where your ads are only displayed if the keyword entered by the user matches your campaign’s keyword(s) exactly. If you’re advertising for the exact word “headphones”, your ads will show up when a user searches “headphones”. If they enter “headphones uk” however, your ad will not show up.

(You can read more about match types here.)

Match types are very, very important indeed. Using exact match keywords allows you to target keywords very precisely – this can be an issue in niches with low traffic figures though because your ads may never be trigged. Broad matching is a great way to blow a load of money with very little return. Phrase match allows you to find some common ground, but spending can still get out of control if phrase match isn’t managed correctly.

To that end, you should always make use of negative keywords. If you’re targeting “headphones” on a phrase match basis and someone enters “free headphones uk”, your ad will be triggered. Obviously you don’t give headphones away for free, so having your ads triggered for that search it pointless. To that end, you should enter “free” as a negative keyword – so anyone else that searches for headphones with the word “free” in the search query is not given the chance to click your ad.

I always try to think up as many negative keywords as possible when creating the campaign. I then look at traffic logs on a daily basis to see what keywords have been searched for to trigger my ads. Usually I find two or three new negative keywords to add to my campaigns on a daily basis. This site offers a fairly comprehensive list of negative keywords if you don’t fancy compiling your own. I strongly recommend compiling your own, or at least going through this list to ensure you’re not turning away potential traffic that is relevant.

 

Search network versus display network

On AdWords and Bing Ads you’ll have the opportunity to select your targeting options – you can have your ads triggered on the search network, or display network, or both.

The search network is basically where your ads appear around the organic search results. The display network is where your ads appear on third party websites. Typically search network CPC tend to be a lot higher than display network CPC – that said, search network traffic tends to be a lot more targeted.

Creatives differ between search an display networks too: On the search network you can only use text ads, whereas on the display networks you’ve got the option of using pictures and other media.

My experience with the search and display networks varies – I’ve always had better results and a better ROI using search networks. That’s not to say display networks don’t work too, but I’ve never had any amazing results using them.

 

Bing Ads 

Bing Ads is much like Google AdWords, except in my experience it tends to receive a whole lot less traffic. That said, running campaigns on Bing Ads is definitely worthwhile and a lot of the time the CPCs are cheaper than AdWords (due to the fact there’s less competition). Some of the statistics I’ve collected over the last few years even suggest the conversion rate from Bing Ads is higher than AdWords – the only issue being there isn’t a great deal of traffic there for the keywords I predominantly target.

Recently I’ve started to use Bing Ads as a testing platform for new campaigns and new keywords. What’s the point in throwing a load of money into gathering data using AdWords, when I can use a platform that’s virtually the same, that won’t eat up as much of my cash? I test new keywords, landing pages, ad copies and more on Bing. When I know what works and what doesn’t I simply transfer the settings to my AdWords campaigns.

As I’ve said though, Bing is a platform you should definitely advertise on because it does have its own merits. Sure it doesn’t send as much traffic as AdWords, but the ROI is usually better, and it adds quite a few thousand pounds onto my bottom line each year. It’s also a case of diversifying from being reliant on just one PPC source.

 

Facebook Ads 

Facebook ads are a great way to drive traffic to your website, they’re also a great way to drive traffic and likes to Facebook fan pages. To be completely honest, Facebook is the PPC network I’ve used the least, but recently I’ve been working hard to get to grips with the ins and outs of it.

Whereas most other PPC campaigns target users based on keywords, Facebook allows you to target users based on the information they’ve entered on their profile. So if you want to target 26 year old lesbians that live in Atlanta and play Halo on the Xbox, you can.

I’m not a massive fan of sending traffic to my own websites with Facebook ads. Whilst it’s possible to get clicks for less than 5p each, it’s a tough slog to get them that low. I also find conversion rates to be particularly low – even when linking to pages I have lots of success with on Bing and Google AdWords.

My dislike for sending traffic to my own websites doesn’t mean I don’t use Facebook ads though. Instead I send traffic from Facebook ads to the fan pages of my websites on Facebook itself. That way I can get a few likes and start to build up a community. I don’t see Facebook likes as being too different to having email addresses on a list – it’s all about building an audience you can forge a relationship with and eventually market to.

 

Google’s Product Listing Ads

Fairly recently Google decided to roll out a new type of advert called Product Listing Ads. They show up on the search network, usually just above organic results. They contain a picture of the product you’ve searched for, and if you click it you’re taken to the advertiser’s website.

AdWordsProductListing

In my very short time using PLAs so far, I’ve found them to be a lot cheaper than traditional search ads – sometimes up to 75% cheaper. They also convert an awful lot better too – currently my conversion rates for PLAs are double that of traditional search ads. So I’m paying less money and getting more conversions – seems like a great deal to me!

As more people start to use PLAs I fully expect them to become more and more expensive, but as it stands I’m happy with the returns I’m seeing on them. Setting up product feeds and working within the Google Merchant Centre is a real pain, but it’s worth it. PLAs aren’t triggered by manually entered keywords either – instead you can group them according to which category they reside in on your website, and then Google automatically displays them to relevant searchers. You can enter negative keywords on your PLA campaigns to stop them triggering when not relevant.

Ecommerce sites are the only type of site that can benefit from PLAs, if you own an ecommerce website they’re well worth looking into.

Tracking 

Lots of people will tell you that the key to the success of your PPC campaigns is to track them – and by this they mean installing the code snippets provided by Bing, Google and Facebook. One of the very first campaigns I developed was for a telephone lead generation site, so it wasn’t possible for me to use the conversion tracking features offered by PPC networks. I did find a way to keep a track of conversions and ROI – I would check traffic logs each day and see which keywords had sent traffic to my site. I’d then look at the movement of the user and marry up the user’s activities with the call logs on my phone. 99% of the time I could identify which keyword users had searched for in order to click my ads and find my site.

Sure, it’s a very time consuming way of doing things, but it allowed me to gather important data regarding which keywords converted and which didn’t. It also allowed me to calculate an accurate ROI for the campaign as a whole, and for each ad group.

Most of my campaigns now use the tracking features offered by the different PPC networks, but I still have a few telephone lead generation campaigns where I do things the old fashioned way! For one campaign I have a list of every keyword that’s ever converted for the last two years – now that’s thorough.

Tracking your spend, which keywords searchers use, which ads they click – however you do it – is the only way in which you can improve your campaigns and work out the overall profitability of them. You should track everything you possibly can – the more data you have available to you, the better you can make your campaigns.

 

Conversion rates 

Conversion rates are the business end of PPC. Good conversion rates are the mark of a successful campaign. Poor conversion rates usually signal that there are bucket loads of improvements that can be made to your campaign. The problem with conversion rates is that they vary wildly across different industries, across different countries, different PPC networks. Conversion rates literally change with the weather.

My experience of conversion rates is varied. For one particular campaign I was working on with CPCs over £5, I managed to achieve conversion rates of just over 20% before I messed with things a little too much, and never managed to regain such high a percentage of conversions. I’ve consistently managed to achieve 15%+ on my conversion rates for this campaign, however.

I’ve also experienced conversion rates of sub 1%, especially in the cosmetics and tattoo niches. I gave up on tattoos altogether some time ago, but with cosmetics I persevered and I’m currently looking at conversion rates of around 5% – even with lots of testing and tweaks. The only reason I’m even hitting 5% is because I’m using Google Product Listing Ads on that particular campaign.

What I’m trying to say here is that there’s no golden conversion rate number you should aim for. Some people will be in niches so profitable a 1% conversion rate is something to be happy about. Other people will find that even on a 10% conversion rate, their PPC campaign isn’t profitable.

Conversion rates also greatly depend on the quality and design of your landing page.  Read this HubSpot article on 7 key design tips for high converting landing pages.

Expect rubbish conversion rates in the first month or two – then use the data you gather between different ad groups to introduce more winning ads. Remember it’s not just the campaigns themselves that need to be constantly tested, it’s the pages on your website that visitors actually land on too.

 

Losing money on PPC

I often ask friends and business owners why they don’t use PPC – the overarching response is that they don’t want to lose money, or they’ve already tried it and they lost money. Make no mistake about it, 99% of people will lose money on PPC initially (I even do it on purpose so I can gather lots of data). That loss may carry on for a few weeks or a few months, but it shouldn’t be viewed as a loss. Instead, you should see the loss as you purchasing data and information. Once you’ve got enough data to work from you can say: “Right, this keyword doesn’t convert so I’ll remove that – this ad doesn’t work so I’ll take this out. That keyword converts really well so I’ll increase the bid, and this ad has a wicked CTR, so I’ll replicate it with some subtle changes.”

PPC definitely requires some “investment” shall we say. Once you’ve been through the motions and started one successful campaign it just becomes a habit. At first constantly tweaking and testing new things is really annoying – but again it just becomes a habit. You might have hit a 20% CTR using a new ad copy but let me tell you, there are always improvements to be made in PPC. The problem is you might think you’ve cracked it so you might stand still – but your competitors won’t!

There are few better ways to drive traffic a website the second it goes online. PPC isn’t just a short-term traffic strategy though, because if you nurture your campaigns correctly it can reap massive rewards in terms of ROI.

About the Author: This article was contributed to Searchable.co.uk by Nick Whitmore. Nick is an online marketing fanatic and owner of http://www.contentwriting.org.

Adam Grunwerg

Mr grunwerg has written 22 post in this blog.

Adam Grunwerg is the founder of Searchable.co.uk and has numerous years of experience in SEO, inbound marketing developing brands online. He has also previously written for the Guardian, SearchEngineJournal and AffiliateFYI.com.

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