Posted May 29, 2008 2:00 pm by with 7 comments

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By Ann Stanley

PPC mistakes – why we make them!

Pay per click is becoming more sophisticated and complicated. The PPC search engines are bringing out new tools and features to help you manage your PPC campaign or target particularly customers. This new PPC functionality is great for the experienced Google Ad Words Professional (GAP) – yet every day more companies are opening their first pay per click account – with little or no experience.

As a Google Ad Words Professional, a PPC practitioner and an internet marketing consultant; I am amazed how often I come across companies that have no basic online advertising knowledge and consequently make the most fundamental PPC mistakes. This article will attempt to identify the most common errors made when using pay per click advertising; but it will also explain how to manage your PPC account to avoid them!

Take part in our online survey to determine our Top of the PPC Flops

We have drawn up a list of 10 PPC mistakes:

1) Having all your PPC keyphrases in one ad group and/or campaign

2) Bidding on generic keyphrases or only using broad match

3) Poor PPC bid management – setting your maximum cost per click too high or too low

4) Starving your PPC advertising budget so your ads are seen intermittently

5) Including content and search networks in the same PPC campaign and/or retaining the content network when it does not perform

6) Selecting the wrong website landing page and/or not tracking your PPC conversions

7) Not optimizing your PPC account in order to improve your click through rate (CTR) and quality score

8) Displaying your PPC ads to customers in the wrong geographical region or including all countries/regions (and languages) within the same Ad Words campaign

9) Using scheduling to turn your PPC ads off so your ads are not seen in the evening or at weekends

10) Not integrating your pay per click advertising strategy with your search engine optimisation (SEO) and other internet marketing techniques

In order to try and create our very own Top of the PPC Flops – we have also got an online survey for you to complete. This will allow us to find out which PPC mistakes are made most regularly and to correlate the results with levels of pay per click management experience.

The PPC mistakes explained and advice on how to best manage your pay per click campaigns

1) Having all your keyphrases in one ad group and/or campaign

When you set up your first PPC account you are taken through a step by step process where you set up one campaign and one ad group. Many users add all their keyphrases into this one ad group with just one ad. This can often contain many unrelated keyphrases.

Recommended PPC ad group structure

You need to divide your keyphrase into discrete ad groups of very similar keyphrases that relate closely together. This means it will be easy to create a relevant ad that has text and a landing page that matches your keyphrases. Using this PPC strategy you will be rewarded with a higher quality score (Google’s measure of relevancy) and a higher click through rate or CTR (% of clicks as a proportion of the number of times the ad is seen or impressions). A high quality score and click through rate means that you will achieve better positions and pay a lower cost per click.

2) Bidding on generic keyphrases or only using broad match

When companies want to be found for as much search engine traffic as possible, they often bid on very generic phrases. For example they may provide a plumbing service in Birmingham, so they bid on the word Birmingham. In addition many new users do not understand the different “phrase match” types, so they enter all the phrases using the default “broad match”. This means that you will be found for any search term combination as long as it contains your original phrase. This will result in unwanted phrases; for example a company bidding for lifts could also be found for someone bidding on face lifts!

Recommended PPC keyphrase selection strategy

When you use the PPC keyword suggestion tool ensure that you only select exact match phrases, ie so you will only appear when the exact phrase is typed in. It does take longer to identify all the different variations, plurals, word orders and miss-spellings, but it will mean that you are only found for the phrases that you want to be found for. If you want to be found for more search engine traffic then have a broad match version of each phrase and make sure you use negative matches for the words you don’t want to be found for.

Generic phrases are less likely to result in conversion (enquiries or sales) and can often be more expensive then the highly specific phrases. When your ad copy is displayed for a generic keyphrase it will appear less relevant than for a phrase that is specific to your product and service. This will result in a low click through rate and poor quality score. If a phrase has a click through rate of <1% it is probably too generic and should be switched off!

3) Poor PPC bid management – Setting your maximum cost per click too high or too low

It is essential to understand the importance of keyphrase relevancy and quality score, as this determines your position in the PPC search engines and the amount you pay per click. Some companies will decide to bid high (in order get position 1-3) and inadvertently enter a bidding war with other competitors. Other companies will bid a low cost per click, irrespective of the positions they achieve. If this results in a positions outside the top 10 then your PPC ads may not be seen! Searchers rarely scan down more than a few pages – resulting in low impressions and click through rates (CTR).

Recommended keyphrase bidding strategy

If you have a very relevant well written PPC ad you can still achieve a good CTR at positions 4-7, without paying excessive amounts to outrank your competitors.

Bidding too low is normally a false economy as it will reduce your CTR’s; it is best to achieve low cost per clicks by having highly relevant ads and great quality scores. Use the PPC estimator tools to set a bid to achieve positions 4-7; then optimise to increase your CTR. This will result in a great quality score; so you should be able to lower your maximum cost per click and still maintain a position in this zone.

4) Starving your PPC advertising budget so your ads are seen intermittently

When you allocate a low pay per click budget to a campaign Google will either show your ad intermittently throughout the day or you will use your entire PPC advertising budget in the morning. Both these options are unsatisfactory as users will often browse a number of websites before coming back to register or buy. However, you will not get any conversions if they can’t find you again!

Recommended PPC budget setting strategies

One common cause of having inadequate PPC advertising budgets is that a company is bidding on too many non-specific keyphrases. This can often result in some keyphrases consuming the entire budget even when these phrases do not result in any conversions.

Another cause is a poor understanding of how the PPC estimator tools work or how to use the recommended budget feature. You should use these tools to set your pay per click advertising budget; if it is higher than you expected then you may have to delete the phrases that do not convert or those with the lowest click through rate.

Companies that limit their PPC advertising budget often do not understand the cost of acquiring a sale (cost per acquisition or CPA) and how much margin they have when selling their products or services. Once you have calculated your CPA (see below) you should set your monthly PPC budget to achieve the amount of enquiries or sales you need.

5) Including content and search networks in the same ad words campaign and/or retaining the content network when it does not perform

Most of the PPC search engines automatically show your ads in their content network. This means that unless you manually switch off the content network your PPC ads will be displayed on a huge range of third party websites and portals. The content network generally has a lower click through rate and conversion rates. So having all PPC networks in the same campaign can be confusing. It can also mean that there may be insufficient PPC advertising budget left for the better performing search network.

Recommended PPC campaign structure

You will need different campaigns for your search and content networks (and for any geo-targeting where your ads are displayed in different languages or locations – see below). You can create new keyword-targeted campaigns manually and then you adjust the targeting and networks within the “Edit campaign settings”. However if you want to clone your current campaign and all its ad groups, then we recommend that you learn how to use the offline tool “Google Editor”. MSN also offers similar flexibility and will shortly have its own desktop tool to allow you to manipulate your MSN Ad Center accounts.

Once you have your content network running in a separate PPC campaign you will be able to see whether it is performing and your cost per conversion. Depending on your budget and objectives you may decide to switch off the content network if you are not getting a good ROI. With significantly lower click through rates and conversions rates, the content network can be less effective. However, with fewer companies bidding on the content network it is generally cheaper per click and can still work for companies wanting maximum levels of visibility and website traffic.

Note the low click through rate of the content network will not adversely affect the quality score of your search terms.

6) Selecting the wrong landing page and/or not tracking conversions

Some companies spend their online marketing budgets driving search engine traffic to a website with a poor design, content and functionality. Dissatisfied users will hit the back button; so there are no sales or enquiries generated from the site, even though the site received lots of traffic. Even when a site is well designed, PPC ads are often pointed to the homepage rather than a more specific page within the site.

Recommended techniques to measure and improve the conversions on your website

Once the user clicks through to your site you have already paid for this traffic. It is therefore essential to maximise the number of conversions by taking the potential customer to the most appropriate page (which should match the keyphrase they entered). So if they are looking for a specific product you take them to page where they can buy the product. If your site is a brochure site rather than eCommerce site, then you need to take them to a page with interesting content and give them an incentive to contact you or register to receive further information. This will allow you to market to them again, for example using email newsletters.

Once a customer carries out a conversion (a sale or registration) they should land on a thank you page where you can add tracking code from your PPC search engine. This will then feed the data back to your PPC account so you can see which keyphrases result in conversions and the average conversion rate. If you have a conversion rate of 1% and you can only afford a cost per acquisition (CPA) of £25 or $25, then you need an average cost per click (CPC) of less than £0.25 or $0.25.

Once you have PPC conversion tracking on place you can optimise on conversions, for example by deleting keyphrases that consume your budget but have low conversion rates, or by testing different versions of your landing page

7) Failing to optimize your PPC account (to improve your click through rate (CTR) and quality score)

You should not continue to bid on phrases with a low click through rate or leave your new PPC account too long without checking it. This can result in a poor Google quality score, which will result in poorer positions and you will pay a higher cost per click.

Recommended techniques for optimisation of PPC campaigns and bid management strategies

Google quality score takes into account a number of factors that attempt to measure the relevancy of the ad copy and landing page for each keyphrase. One of these factors is the historic click through rate of the individual keyphrase (by match type) and the CTR of the account as a whole.

As soon as an account goes live, a very generic phrase can clock up large numbers of impressions without any clicks. This will immediately have an adverse effect on the CTR of the whole account. It is therefore essential that any keyphrases with high numbers of impressions and a CTR of less than 1% are deleted as soon as possible. This will be easier to spot if the keyphrases have already been divided into very specific ad groups (as discussed above). In addition you should test different ad copy to try and maximise the CTR of the ad group to more than 2%. This will vary by sector and type of phrases, for example brand and product names should achieve much higher click through rates.

8) Displaying your PPC ads to customers in the wrong geographical location or including all countries/regions (and languages) within the same Ad Words campaign

Different types of companies can benefit from using the geo-targeting features offered by the PPC search engines. However when users set-up their first campaign they often:

  • use the default settings ignoring the geo-targeting options
  • lump all the languages and countries within one campaign.

Both of these strategies can result in poor performing campaigns and the ads being seen by the wrong customers.

Recommendations for using PPC geo-targeting

The key strategy for setting up geo-targeting is having an account structure that allows you to have different campaigns for each target market (with different budgets for each). If you are a company selling a local service you can select cities, or use the mapping functionality to select an area on the map (eg 20 miles from your office). You may also want a national campaign to target customers outside of your area but are using location-specific phrases for a service or product in your area. For example a landlord based in London that needs a plumber for his rental property in Birmingham.

If you want to export or target international customers then you need to set-up different campaigns in your own language to target specific countries. If you want to target customers in foreign languages, then you need campaigns for each of the different language/country combinations. However you will also have to choose keyphrases, write ads and have landing pages in each language – in order to ensure high click through rates and quality scores.
9) Using scheduling to turn your PPC ads off so your ads are not seen in the evening or at weekends

Many companies try and pre-empt their customers’ search behaviour and turn their ads off out of office ads – particularly when they are trying to reduce their costs. They are then surprised when they have good traffic to their sites but lower conversions than they expected.

Recommendations for using PPC scheduling

Using the reports functionality in your PPC account it is possible to view the searching behaviour of your customers by time of day. You can compare this to your registrations and sales. Depending on the sector it is very common for people to search at different times from when they act. Peak internet traffic is on a Monday – when people return to work and use the internet. So many people search during work hours but they are not necessarily able to get their credit card out to purchase goods, or they don’t have time to complete an online registration. They will often transact online when they are in the security of their own home. Many people work from home or in the evenings – so even a pure business to business service may still benefit from “staying open” out of office hours.

The PPC scheduling tool is very easy to use but we recommend that you run your campaign 24/7 and test when the traffic peaks and when people convert. If you run your PPC campaigns when your competitors decide to turn theirs off, then you may achieve higher positions and lower costs due to the lower levels of competition.

10) Not integrating your pay per click advertising strategy with your search engine optimisation (SEO) and other internet marketing techniques

Pay per click is often used as a quick fix to drive traffic to a new site or a site that is not search engine friendly (eg because it has been built using technology such that cannot be spidered). Other companies will try search engine optimization (SEO) as well as pay per click, but they do not integrate their strategies.

Recommendations on integrating your pay per click and search engine optimisation strategies

We believe that your SEO strategy should be fully integrated with your PPC strategy. In fact we often recommend that companies carryout some form of pay per click test campaign before undertaking an SEO project. This has a number of advantages

  • to quantify levels of traffic and to determine which keyphrases drive traffic and which convert
  • to prioritise keyphrases – so we focus on phrases that are costly to purchase through pay per click or have good levels of traffic
  • to identify keyphrases that are not worth optimising – that is phrases that are very specific or very cheap so that they do not warrant creation of new optimised content
  • to find any weaknesses in the site – such as poor landing pages, weak calls for action etc

Once you have the target list of phrases you will need to go through a step-by-step process to create optimised content for your site (including an ongoing link building strategy). You can then review your positions in the search engines and determine whether you can switch off you PPC ads as your organic traffic increases.

This is an entry to Marketing Pilgrim’s 3rd Annual SEM Scholarship contest.

  • Excellent article Ann. Some of these mistakes are being made by even “seasoned” search marketers. The biggest mistake IMHO is #10. Often different agencies are responsible for PPC and SEO and therefore the client is wasting money.

    PPC + SEO = Better ROI

    David Temple’s last blog post..SEM Scholarship contest, step it up!

  • Online surveys that pay are a very big business on the Internet. These help those who develop products, services or programs to be able to gauge the markets response to new development concepts.

  • hey, i m calculation the CTR but i m not able to get the right answer, would anybody let me know what is the exact formula to calculate CTR??

    i m using this one!

    Impression * No. of Clicks / 100 = ?

    is it right??

    Please let me know!!!!!


  • Hi William
    the calculation is number of clicks divided by the number of impression x 100. eg if you have 50 clicks and 1000 impressions the click through rate will be 5%.
    I try to achieve an average CTR of more than 2% for each ad group (for search network only – that is the content network is in a separate campaign).
    So I generally pause any phrases with a CTR of less than 1%.
    I hope that helps?
    kind regards

  • Hi, great article. I’ve made some changes for my google ads now based on what’ve you written.


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  • dean jackson

    I’ve spoken with a lot of PPC companies, but the most important thing that you can actually do to your marketing campaign is landing pages. Most companies sell you 1 single thing such as web design, or just Google Adwords, or just popups, or just retargeting etc. This is completely ludicrous because while 1 thing may make a difference in a stable marketing campaign, there is no single element that is a make or break element in online marketing, you need the entire package, and then hone/optimize from there. My business revenues increased by over 60% in two months once I picked a good agency that did more than just PPC, but also did my landing pages, retargeting, banner ads, etc. In fact, I’ve got Simon’s phone number right here, you can talk to him too. Just give him a call at 302-401-4478 .