<< by on February 17th, 2012
As a Search Marketing Agency, we have a lot of employees that are obsessed about squeezing every bit of performance possible out of our clients Pay Per Click Advertising. Search Marketing User Interfaces give multiple metrics to help advertisers see how they are doing. But as an agency that deals with millions of PPC clicks every month, we learn pretty quickly with the scale of the data we get to work with what metrics really make a difference in delivering conversion/lead/sales success and what metrics don’t.
If conversions are the goal of your advertising, then the first rule of managing your PPC account is “Not all clicks are created equal.” PPC is a “meritocracy”. The clicks that convert get all of the love, affection, increased max Cost Per Click bids and Budget. The keywords that don’t convert get minimized with lower bids and eventually even paused. There is no such thing as a “No keyword left behind” in a successful PPC account. It’s possible to do a keyword “reclamation project” by improving the post click experience of keywords that historically not converted with custom landing pages, but you still have to rely on the data at your disposal on what you decide to do with your keywords.
The Problem: All Keywords Are Not Created Equal. But Click Through Rate Treats All Words Equally
Aggregate numbers are often the measurement that clients or executives look at to try and understand how their accounts are performing. For the most part, that’s what they should be looking at. The “Bottom Line” is what matters to them. But the “Bottom Line” aggregate metrics for Click Through Rate are a little bit flawed. Aggregate click through rate measures total clicks divided by total ad impressions. The majority of an advertisers clicks do not lead to a conversion, but aggregate click through rate cares just as much about the non-converting click as it does the converting click.
If you manage bids by conversion performance, you are going to be reducing your max Cost Per Click bids on keywords that don’t convert and as a result will usually be lowering your ad position on the page. The problem is that click through rates for ads at the bottom of the page are typically much lower than click through rate for ads at the top of the page. When you lower a bid and an ad position, you have to also know that you will be lowering the click through rate on that keyword and at some level the aggregate Click Through Rate.
As illustrated above, from a recent study on Search Engine Journal , ad position has a significant impact on click through rate. If your costs per conversion are prohibitive, then you may only be able to justify bidding enough to be well below the fold on certain keywords. As a result you should expect to receive almost half the click through rate that you would receive when having an ad position at the top of the page. Here’s the thing you need to know about this kind of a move…It’s the right thing to do.
What’s the Alternative to Aggregate Click Through Rate?
If conversions are your goal, then the measurement you need to be paying attention to to know if you are improving your Pay Per Click advertising is Click Through Rate on Converting Keywords.
You obviously want to get as many clicks as possible on the keywords that generate your leads/sales/conversion actions. Appropriate actions to accomplish that goal might include
- raising maximum cost per click bids
- use of keyword match types (especially exact match keywords)
- use of negative keywords to eliminate irrelevant search queries triggering ads to show
- breaking out top performing keywords from poor performing keywords into their own campaign to maximize budget allocation on them
- writing ad copy that matches the keyword searched in order to get more bold text in the search ads
- using ad extensions to that tend to raise click through rates
- Using Google Direct Connect to get Social Recommendations appearing on ads
It’s easy to utilize filters to calculate if you are improving your click through rate on converting keywords, and taking the steps above should help you improve your conversion volume on the “pre-click” side of your Pay Per Click Advertising.
If you start improving your post click experience on your poor converting keywords with a better landing page experience, you can then take the same steps to improve your click through rates.
Aggregate Click Through Rate is a metric that clients immediately look at when we deliver reports, but with a little steering and education they see it’s flaws. There are benefits to boosting it in terms of Quality Score, but if conversions are your priority you need to work on increasing the post click landing page experience first, then start working on improving click through rate performance. It’s all a matter of priorities.