6 hidden problems that could be plaguing your paid search performance

Most brands assume that their pay-per-click (PPC) agency or internal team has configured their account—and continually monitors performance—in ways that will truly optimize ROI. But all too often, there are hidden inefficiencies in their PPC account structure that are going unnoticed. If that’s the case for your brand, you can expect a domino effect of deteriorating paid search performance:

1. Significant amounts of your budget will be wasted on irrelevant search traffic
2. Search engines will recognize that your ads aren’t being clicked, or that clicks on your ads aren’t leading to conversions, which lowers your quality scores
3. Your cost per click (CPC) will rise sharply, even on searches that are relevant to your product or service
4. You’ll forfeit droves of high-purchase-intent searches to your competitors

There’s one simple way to make sure you’re optimizing your PPC spend

Even in campaigns that seem to be performing well, there are always opportunities to make subtle tweaks in your account structure that will move the needle in short order. You just need a fresh set of eyes to “peek under the hood” and assess the overall health of your account by analyzing:

• How your keywords compare with actual search terms
• How your keywords are organized within ad groups
• How you’re measuring the value of search traffic
• How you’re bidding on traffic of varying value
• And much more

For example, after reading our comprehensive paid search audit and recommendations, a leading specialty insurer asked us to implement our proven PPC strategies. In just three months, the client’s paid search performance improved. When it came to new customers who selected “internet search” or “website link” as the source of their business…

• Quotes increased by 48%
• Binds increased by 31%
• Cost per quote decreased by 50%

Two case studies that highlight the problems a paid search audit can detect (and quickly solve)

Throughout this blog, we’ll reference various examples of problems that we uncovered while running a paid search audit for two brands that later became clients, and the recommendations we gave them for how they could quickly optimize their paid search performance.

Client A is an airline that operates daily nonstop flights between two major U.S. cities. For the purposes of maintaining the client’s anonymity, anytime we make a specific reference to the client’s keywords or relevant search terms, we’ll use “[city 1]” or “[city 2]” in place of the two actual markets that the client services.

Client B is a niche vehicle insurer. For the purposes of maintaining the client’s anonymity, anytime we make a specific reference to the client’s keywords or relevant search terms, we’ll use “[vehicle]” or “[vehicles]” in place of the actual product that the client insures.

Problem #1: Broad match is causing wasted spend on irrelevant search terms

When setting up the keywords in your ad groups, you can assign three basic match types—broad match, phrase match, and exact match—which give you increasing levels of control over how closely a prospect’s search term must match your keyword in order for your ad to appear.

We recommend sticking with the latter two match types, yet all too often we observe the overuse of broad match. Casting a wide net like this tends to “open the floodgates” and gives Google wide berth to show your ads on irrelevant search terms that aren’t going to drive revenue for your brand, potentially wasting obscene amounts of your budget.

Example from Client A’s Audit:

The client intended to bid on keywords like…

“airplane to [city 2]”

…but because they were using broad match, they were unknowingly wasting hundreds of dollars to show up in thousands of searches for…

“sexxy [city 2] show”

“sexxy [city 2] show tickets”

…and the like.

Example from Client B’s Audit:

The client was bidding on…

“low cost [vehicle] insurance”

…but as it turned out, the search term that the client was spending the most money to appear for was…

“cheap [vehicles]”

Four of the six active keywords in this particular ad group were broad match, and over 50% of the spend was going toward unmodified broad-match keywords.

Recommendations to Solve the Problem:

• Eliminate broad match to avoid wasted spend
• Focus spend on best converting phrase- and exact-match terms
• Use phase match to continue to capture a wide range of relevant search terms and discover new keywords

 

Problem #2: Bidding doesn’t reflect the value of each search’s true purchase intent

It’s relatively easy to determine whether someone is searching for general information related to what you’re selling or if they are clearly in market for your specific product or service. If, based on a person’s search query, he or she is expressing a high likelihood of converting, it’s critical that your bids are set properly so that you’re willing to pay a higher CPC to appear in those lucrative searches. This is especially true for exact matches, which will inherently possess more value than broad matches.

Example from Client A’s Audit:

The existing bidding structure placed equal bids across the board, so even though the click-through rate (CTR) was between 43% and 50% for high-intent searches, such as…

“[city 1] airport to [city 2] flights”

“[city 1] to [city 2] flights”

“[city 1] to [city 2]”

“[city 1] airport flights to [city 2]”

…the client was bidding the exact same amount on low-intent searches that had a CTR between 2% and 4%, such as…

“[city 2] hotel deals”

“[city 2] suites”

Recommendations to Solve the Problem:

• Implement a more sophisticated bidding structure to reflect true value of search traffic
• Raise bids for highest converting keywords to maximize high-value traffic to capture as much high-intent traffic as possible

Problem #3: Ad groups aren’t granular enough to delineate varying search value

Sometimes, your bidding won’t reflect the true value of a search’s purchase intent because your ad groups aren’t granular enough. It’s critical that you differentiate keywords of varying value by implementing a highly granular ad-group structure that allows for search traffic to be messaged in ways that are specific to the search.

Example from Client B’s Audit:

All non-branded and non-competitor keywords belonged to a single ad group. As a result, even though the client was enjoying a 60% increase in conversion rate when “[vehicle]” was included in the search term…

…the client was actually paying a higher CPC for search terms that didn’t include “[vehicle]”.

Recommendations to Solve the Problem:

• Restructure ad groups in a way that effectively groups similar search traffic
• Allow for bids to reflect the true value of the search traffic and optimize cost per conversion
• Write ads unique to each ad group, increasing CTR and quality scores

 

Problem #4: Not bidding on enough keywords to determine what’s driving performance

If you’re not bidding on a diverse group of keywords, then you won’t capture all relevant search terms, and you can’t precisely differentiate the subtle differences in the way people search. You cannot improve your paid search performance if your account simply doesn’t have enough data points to determine what’s working and what’s not—and why.

For example, if you don’t add discrete keywords for “life insurance quote” and “life insurance quote online”, you might never realize that—as is commonly true—people who include the word “online” in their search term tend to convert 15% more often, and so you couldn’t adjust your bids accordingly.

Example from Client B’s Audit:

The client had a total of just six keywords in its primary ad group, so even though there was significantly more value in searches for…

“[vehicle] insurance quote online”

…the client was bidding equally on searches for…

“cheap motor insurance”

Recommendations to Solve the Problem:

• Expand keywords so that they better reflect the wide range of actual search terms, allowing for a truer sense of what searches are driving results
• Allow for more precise bidding to optimize spend
• Improve Adwords quality scores by having keywords that closely tie to search terms, thus lowering costs and increasing clicks

 

Problem #5: Not adjusting bids based on the most lucrative geographic locations

If conversion rates are higher for searches that originate in certain locations, you need to adjust your bids based on that information to improve your paid search performance. Or, even more glaringly, if you’re not allowed to sell your product or service in certain states, etc., you don’t want to waste bids in those places. Many brands assume that their agency is accounting for those obvious details, but you’d be surprised…

Example from Client B’s Audit:

The client’s PPC campaign was driving hundreds of quotes (conversions) in North Carolina and Massachusetts, but they weren’t legally allowed to write policies in those states.

Recommendations to Solve the Problem:

• Adjust location targeting to focus only on states where the client offers coverage, or where rates are most competitive
• Adjust targeting to eliminate wasted spend
• Bid-adjust state-by-state (or even at metro level) based on bind rates

 

Problem #6: Not adjusting bids based on device, timing, response medium, audience, etc.

Many times, performance of your ad will hinge on variables that have nothing to do with the actual search terms, and you need to adjust your bids to reflect those differences.

Device: Ads for your product or service might convert at a 30% lower rate when people are searching on a mobile device vs. a desktop.

Timing: Maybe your conversion rates are, for a variety of reasons, higher on the weekends vs. weekdays.

Response Medium: Perhaps your conversion rates are higher when prospects call vs. getting a quote online (and your call center is open only between certain hours).

Audience: It’s critical to know the searcher’s position along the purchase path before serving them an ad, and you can determine that with the help of RLSAs (Remarketing Lists for Search Advertising), your existing customer file, and other data sources.

Obviously, if a searcher is already an existing customer, it doesn’t make sense to waste money serving them an ad, because maybe they’re just searching for your brand because they’re trying to access your user login portal. There are some exceptions to this rule, however, like if you’re in event marketing and are trying to reach past attendees with information about an upcoming event.

RLSAs allow you to place higher bids on searches from people who have already made some progress through the purchase funnel for your product or service (and/or have clearly demonstrated in their browsing history that they are in market for what you’re selling). These are extremely hot leads that you can’t afford to let slip away to your competitors.

Example from Client A’s Audit:

The client was bidding on searches that sought flight information regarding [City 1], such as…

“[city 1] airport flights”

“flights from [city 1] airport”

“[city 1] flights”

“[city 1] airport”

…but those people hadn’t specified [City 2] in the search terms.

Now, because Client A’s shuttle operated between those two cities exclusively, one might assume that the thousands of dollars being spent on those generic searches was a waste—and it was—but it didn’t have to be.

As you’ll see below, there are ways that the client could have been capturing searches that appeared generic at the search-term level, but that were actually extremely relevant to what they were selling.

Recommendations to Solve the Problem:

• Use audience targeting to improve performance of general keywords
• In AdWords, layer “In-Market for Trips to [City 2]”

Want to be certain that you’re optimizing your paid search performance and campaign ROI?

We’d be happy to run a free paid search audit for your company. Hopefully, you’ll receive a clean bill of health, and you’ll come away with peace of mind knowing that you’re investing your PPC budget as efficiently as possible. If not, you’ll have a handy set of recommendations to whip your paid search into shape and get back on the road to profitable ROI.