Archive for the ‘Internet Advertising’ Category

How to test your ad copy for Google AdWords

Monday, July 20th, 2009

In today’s post, I will describe both the ease and importance of testing Ad Copy.

“Ad Copy” as defined here, is the four lines of ad text that the search engines allow in their Sponsored Links section on the right hand side of a search results page.  Here is an example of a typical ad on Google:

roofer ad

  • The first line is the Title of the Ad Copy
  • The second and third lines are the Description of the Ad Copy
  • The fourth line is the Display URL that you want to use for Branding your website.

What exactly is A/B testing?

A/B testing is a commonly used term in statistics where one controls for other factors to measure how Version A of “something” performs compared to Version B.  Within the context of A/B testing of Ad Copy, this holds all other factors constant, and then measures performance of Ad Copy A against performance of Ad Copy B.

As an example, let’s say that you want to indicate in your Ad Copy that you have discounted your product from $50 to $40.  You may now want to know what would work better: “Discounted by $10” or “Discounted by 20%”.  Well, you don’t have to guess.  With A/B testing, you can actually test and know for sure what works better.

What does “performing better” mean?

What does it even mean to say “Ad Copy A is performing better than Ad Copy B”?  There are multiple definitions of “performing better”, all other things being equal:

1)      Which Ad Copy gets clicked more often

2)      Which Ad Copy leads to a higher conversion rate

3)      Which Ad Copy results in more profits

Note that just because an Ad Copy gets clicked more often does not mean that it will lead to more conversions.  For instance, if an Ad Copy overpromises (e.g. “free camera”) which the website itself fails to deliver (no free camera), the Ad Copy will get clicked often, but the disappointed users won’t convert into customers.

Also note that just because an Ad Copy leads to a higher conversion rate, does not mean that it is more profitable.  For instance, consider:

  • Ad Copy A with a 10% conversion rate on an item priced at $20 and
  • Ad Copy B with a conversion rate of 5%, but for an item priced at $200

In this example, Ad Copy B may be more profitable even if it has a lower conversion rate.

What exactly is: “all other things being equal?”

Above, I have used the phrase: “all other things being equal”.  This means holding all other factors constant in the “environment”.  For instance, if we were testing Ad Copy A and Ad Copy B, then one “inferior” way to do this would be to use Ad Copy A today, and Ad Copy B tomorrow.  Then we could measure which one performed better.

The reason this is “inferior” is that external environmental factors could have changed (e.g. new competition) between today and tomorrow.  The right way then to do this kind of A/B testing is by alternating Ad Copy A and Ad Copy B in “real time”, i.e. showing Ad Copy A to a user followed immediately by showing Ad Copy B to the next user.

Implementing A/B testing

A/B testing on the Ad Copy is very easy to set up as all the major search engines including Google provide the infrastructure for this.  Google even has the option where you can ask Google to show the better performing ad more often in an automated manner.  However, if you do use this Google feature, note that Google will use definition 1 (above) of better performing, i.e. the ad that gets clicked more often will be shown more often.

Now that you know how to test and measure the performances of different versions of an Ad Copy, in my next post, I’ll talk about writing good ad copy.

Written by Nadir Hussain, COO, Media Flint, Inc.

Nadir Hussain is an Internet Advertisement and Search Engine Marketing expert. He is both Google and Yahoo certified for their Internet Advertisement programs.  He teaches an Internet based Advertising class both at UC/Berkeley Extension and the Continuing Studies Program at Stanford University.  His education comprises of a Bachelor’s degree in Computer Science & Mathematics from UC/Santa Cruz, a MSEE from Stanford University and an MBA from UC/Berkeley.

Tags: , , , , , , , , , , , ,
Posted in Internet Advertising, Search Engine Marketing | No Comments »

Explaining online local advertising conversion

Monday, July 13th, 2009

Overview

In today’s post, I will describe what Conversion Tracking is, and why it is so vitally important for running profitable online advertising campaigns.

Recall from my last post that Profit Maximization required measuring different profit levels at different Max CPCs (Cost Per Click) and then settling down on the Max CPC which yielded the most profits.

The important thing to realize that you can set a different Max CPC for every keyword!

Tying a Conversion back to the Keyword

Let’s assume that your Google AdWords ad campaign:

1)      is profitable after subtracting out advertising costs

2)      has 100 keywords that have been bid on.

Now, what if 80 of those 100 keywords are profitable, and the remaining 20 are losing money?   You may still be profitable overall, but it is imperative that you find the 20 that are losing money and take specific action on those 20 to increase your profitability further.

For Google AdWords, when you install the Google Conversion Tracking code on the “conversion page” (the page that signifies that a conversion occurred, e.g. the “Thank you for your order” page, or the “Thank you for contacting us” page), Google knows which keyword search eventually led to that conversion.  In the AdWords reports, Google will clearly show how individual keywords are doing in terms of eventually leading to conversion (and not just clicks).

Acting on Conversion Tracking data

Once you have installed Conversion Tracking, you can now see which keywords are actually generating the profits for you and which aren’t.  This granular level of detail enables you to take action at a keyword level to increase your profitability.

This concept is so simple and yet so powerful that you simply must install Conversion Tracking from “day 1” in every Ad Campaign you run online.

In my next post, we’ll talk about writing good ad copy and testing ad copy in an A/B testing framework.

Written by Nadir Hussain, COO, Media Flint, Inc. Nadir Hussain is an Internet Advertisement and Search Engine Marketing expert. He is both Google and Yahoo certified for their Internet Advertisement programs.  He teaches an Internet based Advertising class both at UC/Berkeley Extension and the Continuing Studies Program at Stanford University.  His education comprises of a Bachelor’s degree in Computer Science & Mathematics from UC/Santa Cruz, a MSEE from Stanford University and an MBA from UC/Berkeley.

Tags: , , , , , , , , , , , , , , , ,
Posted in Internet Advertising, Search Engine Marketing | No Comments »

Paid Search Advertising for Local Services Businesses

Tuesday, June 23rd, 2009

Overview

In my previous blog post, I had described why Paid Search Advertising is so powerful and how to get started with it. Today, I will delve deeply into several important concepts within Paid Search Advertising including:

  • max CPC (cost per click)
  • quality score
  • determinants of ad position and actual cost per click

What is ad position or ad rank?

Recall that when a user searches on Google, a set of links to web pages are returned. The set of links at the right and towards the top of the page (with a light brownish background) where it says Sponsored Links, are really advertisements. Each such advertisement has an ad position starting from ad position 1 (top most ad), and then ad position 2 (the second ad from the top), etc. all the way down the right to the bottom of the page.

It should, perhaps, come as no surprise that the higher up the ad is, the more the chances that it will get clicked, all other things being equal. This therefore implies that you want your ad to be higher up on the page. So this leads to a critical question: what factors determine the position of your ad?

Your Ad Position is determined jointly by Max CPC and Quality Score

Recall that in Paid Search Advertising you pay only per click, i.e. only when your website gets a visitor. All the major search engines (Google, Yahoo, Microsoft) now work this way. When setting up your ad campaign, you decide the maximum you are willing to pay per click (i.e. pay per visitor). Let’s say that you determine that $0.50 is the maximum you are willing to pay per click. This $0.50 then is your Max CPC (cost per click).

Quality Score can be thought of as a measure of the user experience when users search, see your ad, click on your ad, and visit your website. If the overall user experience is good, the Quality Score will be good. So how exactly is Quality Score measured? The different search engines measure it differently. Google, for instance, defines Quality Score at a keyword level, i.e. each keyword has its own Quality Score. In Google, the Quality Score depends on:

1. alignment of the keyword, ad copy and landing page (i.e. is the ad copy relevant to the keyword searched on, and is the landing page content relevant to the keyword searched on and the ad copy clicked)

2. click through rate, i.e. how often does a user click the ad after they search on a specific keyword

3. historical performance of the keyword in question

4. account level performance of your campaigns

5. other factors

Your ad position is jointly determined by your Max CPC and your Quality Score relative to your competing advertisers. The higher your Max CPC and/or the higher your Quality Score relative to your competitors, the higher up your ad will show.

What is the relationship between Max CPC and the amount actually paid per click?

The easiest way to describe the relationship between Max CPC and actual amount paid per click is by considering a straight auction where the winner pays $0.01 more than the next highest bidder. So here too, you will pay less than your Max CPC, and just enough to beat the next highest bidder. Of course, because Quality Score calculations also figure into the equation, this amount will not simply be $0.01 more than the next highest bidder.

In my next post, I’ll delve deeply into the critical tradeoff between getting more visitors to your site and paying more per visitor. I’ll also discuss how all this can be neatly linked together in an effort to maximize your profits and what that even means.

Written by Nadir Hussain

COO, Media Flint, Inc.

Nadir Hussain is an Internet Advertisement and Search Engine Marketing expert. He is both Google and Yahoo certified for their Internet Advertisement programs. He teaches an Internet based Advertising class both at UC/Berkeley Extension and the Continuing Studies Program at Stanford University. His education comprises of a Bachelor’s degree in Computer Science & Mathematics from UC/Santa Cruz, a MSEE from Stanford University and an MBA from UC/Berkeley.

Tags: , , , , , , , , , , , , , , , ,
Posted in Internet Advertising, Search Engine Marketing | 1 Comment »

Measuring your local online advertising

By Seth Cohen
Friday, June 19th, 2009


measure“Half my advertising is wasted, the trouble is I don’t know which half.”

John Wanamaker, 1838-1922, department store owner and considered the father of modern advertising

Is your advertising working?  How do you know?

A survey of local small businesses found that almost one in ten had no way of knowing if their advertising was effective or not.  Another 20% relied on the companies they spend their advertising dollars with to help them figure out how well their advertising worked.

Local Online Advertising Goals

Before you start local online advertising for home services, you should clearly decide on your goals:

  • Who are you trying to reach?  (age, gender, income)
  • Where do they live/work? (neighborhood, city or state)
  • What are you trying to get them to do?  (come to your store, call for a quote, visit your website)

This all sounds pretty basic, but the more thought you put into the process before you begin, the more focused your local online advertising dollars will be.  This focus will help you choose the correct message and figure out the best way to reach your ideal customer.

  • If you are trying to reach busy moms, morning radio when they are getting kids ready or shuttling them to school might be a good opportunity.
  • For young professionals, advertising through keywords on a search engine or on local websites may allow you to reach them even if they don’t watch a lot of TV or read the newspaper.
  • For homeowners looking for help with home repair, participating in an online community, such as HelpHive, can allow you to demonstrate your expertise and reach people who are actively searching for your type of business.

Is your advertising working?

After you decide on your goals, your target customer, and where to place your advertising, you need to make sure it is working.  These are some simple tricks you can use to make the most of your advertising budget:

  • Measurable.  Use measurable advertising such as keywords through a search engine.
  • Unique Codes.  Use a coupon or coupon codes in print, direct mail, newspapers, radio or outdoor marketing.  Use different codes or offers on each different type of advertising.
  • Ask Source.  Ask customers how they heard about you.  Be consistent and keep a notepad or tally by the telephone or cash register so you don’t forget.
  • Unique phone numbers.  Use different toll-free numbers on different marketing materials.
  • Test.  Use different versions of advertising to see if one style or message performs better than others.
  • Measure.  Measure increases in your business, such as increased sales, foot traffic, telephone calls, or visits to your website before, during and after the campaign.  And remember, sometimes it takes a while for customers to contact you.

You may not be able to measure 100% of all your advertising dollars but following these suggestions should get you above the 50% mark.

Seth Cohen is an online marketing expert previously with Spot Runner and Ebay.

More about Seth Cohen

Tags: , , , , , , , , , , , , , ,
Posted in Internet Advertising | No Comments »