The first website to offer paid advertising was GoTo.com in the late nineties. Advertisers in the early days of digital marketing could bring visitors to their website for as little as a penny per click on GoTo.com. Marketers could get their website found in a variety of search engines at the time by bidding for placement in search results.
This changed marketing and advertising forever.
I’ve been a part of these changes working with clients over the past 20 years in what became known as pay-per-click advertising and today is simply called “ads.”
We have come a long way since the days of GoTo.com and a very basic formula for getting clicks to your website. Google now dominates the world of online ads like no other company has ever dominated advertising because Google owns over 70% of the marketplace for online search.
Google Ads can generate results, but only for companies with the right formula for success.
Let’s take a closer look at a winning formula for success with Google Ads developed from my experience that started with GoTo.com over 20 years ago.
The Formula for Google Ads Success
Success with Google Ads is dependent on many factors making it a challenging digital marketing channel. First, it is highly competitive for most companies, especially those marketing nationally on popular keyword searches. Google has over-engineered Google Ads interface. It is complicated and difficult to use, much more challenging than the early days of GoTo.com.
Another critical issue is Google’s ever-changing editorial policies for ad copy and websites. These policies can be inconsistent, impartial by industry and change overnight. Companies have no control over Google’s ad policies. Finally, it’s challenging to speak to a knowledgeable rep at Google to get help.
There is hope to overcome these problems with a winning, time-tested formula for success. Get each part of the formula right, and you will see marketing results from Google Ads.
Strategy + Google Ads Knowledge + ROI Formula = Google Ads Success
Let’s review each part of this formula in more detail, starting with strategy.
Google Ads Strategy
Doing the right things in Google Ads will get you to your marketing and sales goals.
Strategy defines what those right things are and how to get them done.
Strategy is critical for Google Ads, because of all digital marketing tactics, Google Ads has the highest risk for poor ROI. There are many unknown elements to paid search and often a poor understanding of user intent. This makes Google Ad strategy difficult and also rewarding when done right. Getting the strategy wrong can cost your company money and getting it right can help your company grow.
Here is how to get Google Ad strategy right. It is dependent on the following factors:
- Developing clear marketing and sales goals for Google Ads
- Gaining a deep understanding or prospect or user intent
- Campaigns and Ad Groups built on that user intent
- Landing pages and a company website with highly relevant content matching user intent
- Excellent call-to-actions (CTAs) based on a strong digital marketing funnel that understands the path people take in their customer journey
- Targeting the most productive keywords and removing irrelevant terms
- Google Ad copy that is brief, direct and relevant to the search terms and user intent.
- Setting a budget matching your goals for branding and direct conversions
Start with clear expectations about the actions you want people to take when they see or click on your ad. Work out how to track the overall lift to your business from the awareness brought to your company from Google Ads.
Two Common Google Ad Strategies: Branding and Conversions
The two most common strategies for Google Ads are first, branding your company to build awareness in targeted markets, and second, direct conversions leading to sales. Google Ads is excellent at achieving for both these strategies.
The best strategy is a mix of direct online conversions and branding.
To make these strategies work, you must have a very clear understanding of the prospective customer and develop strong personas so you understand their desires and their pain. Your ad content and landing pages should focus on this user intent, for both impressions, clicks and conversions. One of the most common mistakes we see in Google Ads is throwing out too big a net leading to a disconnect between your campaigns and the intent of the users.
It is important to set a risk threshold for the spend and targets based on user engagement and conversions. The best methods for mitigating risk are testing, trial and error, data analysis and more testing. This helps tweak results as well.
Also, competitive insights help determine this risk threshold and your budget as you bid against competitors. However, best practices in Google Ads in competitive segments can be difficult to determine because of the sheer number of searches and volume of traffic. Millions of dollars can be spent, which some companies are willing to spend to meet their marketing goals.
Keep the focus on your company and avoid going down the path of watching your competitors and attempting to match what they are doing on Google Ads.
Google Reps: Strategy, Budgets and Competitors
This is a hidden secret about Google Ads. There are very knowledgeable Google support reps who can be invaluable to success with Google Ads. The problem is they are hard to find!
Google Ads reps have insights not available anywhere else. Here are a few questions to ask your Google rep, if you are fortunate enough to get their counsel.
- What is a recommended budget to become a market leader and reach our goals?
- Where will Google Artificial Intelligence (AI) be most effective in reaching our goals?
- Are we missing any opportunities in our current campaigns?
- What are our competitors doing to get results with Google Ads?
A Google rep can help you determine an estimated budget to meet your growth goals.
Talk to your Google rep about your competitors and what is working for them in Google Ads. The rep can see the spend of all your competitors and their online reach. This will serve as a critical benchmark for your company as it competes in Google searches. The rep won’t give you specifics, but they can help you avoid a bidding war.
Bidding wars are common in Google Ads and companies often drive up the price of ads reaching for the top position and attempting to stay there. It is impossible to know what your competitors will do when attempting to price them out of positions in Google Ads. Google loves when this happens because they make more money, but it is not good for advertisers. Competitors know what keywords convert and will target them, this will drive up ad spend too.
The Google rep can also check-in on a monthly basis on your campaigns and provide additional insights as you develop new campaigns, landing pages and conversion points. A Google Ad rep assigned to your account will be critical in helping you and your team better understand how Google Ads work, which is a key part of your formula for success.
We are fortunate at Intuitive Websites to have access to a knowledgeable senior Google rep, contact us to get access.
Google Ads Knowledge
Knowing how Google Ads works is a key part of the formula for success. A good way to understand Google Ads is by knowing the terms used by Google. Here are the term definitions you need to know:
What is Branding in Google Ads? – Branding is the general process of building awareness for your company. It’s the first impression people get from seeing your company name for the first time. Branding is the impression left with people after they see your company for the first time and repeatedly in online searches. Branding is experienced in the Google Ads copy, your landing pages and the company website. The brand is developed based on effective graphic designs, ease of use, user-focused content and resources to support the strong design.
What are Google Ad Campaigns? – Google Ads are broken into campaigns which are set by the market segments being targeted. For example, product and service searches may each need a campaign. This puts a focus on the user and searcher with ad copy, landing pages and key search terms relevant to their needs and intent. These are key parts of Google Ad campaigns.
What are Google Ad Groups? – Campaigns are broken into Ad Groups based on the keywords used in the campaign to target the ad copy. Ad Groups focus the keywords and the ad copy into niche segments. Your landing pages may not need to change for each Ad Group depending on user intent. Without Google Ad groups, keywords would be too broad at the campaign level.
How are Keyword Searches Defined in Google Ads? – There are two ways to look at keywords. The keywords targeted by the Ad Groups and the actual keywords used by people on Google. Both these reports are broken down in the Google Ads account reporting and should be reviewed on a regular basis. Keywords can be broad, in which case Google throws out a huge net and over time the Google machine learning, or artificial intelligence (Google AI) focuses on the most effective keywords and user segments.
How Does Google AI Work? – Google AI works in two key areas. First, it helps find the best performing keywords based on click and/or conversions, and second, Google learns who is most likely to engage with your ads. It can do this because Google knows so much about people using the search engine. For example, Google can mine the data from millions of Gmail user accounts. This includes their search history and the content of their emails. This data mining, and other factors proprietary to Google, drives Google’s AI.
Google takes great pride in their machine learning or AI, but the concern is the time it takes for the AI to get results and ultimately the increase in spend while the Google AI gets up to speed. The Google AI can be used to maximize conversions by targeting searchers most likely to convert based on who has converted in the past. It is recommended to optimize for conversions using Google AI because it is the best use of Google’s targeting to drive ROI and keep the ads focused on your target market.
Google Ads Smart Bidding – A part of the Google AI includes automated bidding to maximize results. This should be part of your budget strategy and watched daily early on to optimize ROI.
What are Negative Keywords in Google Ads? – Negative keywords are search terms you can block in your account settings from displaying your ads. They are critical to Google Ads success. These negative terms must be reviewed daily early on in your campaign set-up and weekly on highly active campaigns. Negative keywords are one of the best methods for improving ROI and managing the overall spend.
What are exact match, phrase match, broad match and modified broad match keywords? – These are important because they drive ROI and budget results. You will find more information on these types of keywords in your Google Ads account. Exact match is just that, it is targeting keywords that match exactly the terms you are targeting. Phrase match allows for the search term individual words to change the order in the phrase. An example would be targeting the term “tennis shoes” and also getting traffic from the search phrase “shoes for tennis”. Both would work to find people looking to buy tennis shoes.
Broad match throws out a big net and is not usually recommended. So when searching for “tennis Shoes” you will get many searches related to both tennis and shoes, but not necessarily traffic from people looking to buy tennis shoes. Modified broad match targets this a bit more and is in between phrase match and broad match.
What are Impressions in Google Ads? – This is an indicator of how many times your ad was potentially seen by users in Google search results. It is not an indication of clicks and there is no guarantee the user saw your company name and experienced your brand, but it does report your ad was displayed in the search results.
What are Clicks and Click Through Rates (CTR) in Google Ads? – This is an indicator of how many users click on an ad and go to your key landing pages or website linked to the ad. Google also calls this interaction rate. Good Google Ad campaigns and ads will have a conversion rate over 3%. Anything conversion rate below 1% is a cause for concern and further review.
What are Conversions in Google Ads? – A conversion is a measurable interaction with a user. The user is reaching out and is no longer anonymous. Users convert through their preferred method and multiple conversion points or CTAs are needed to meet user needs. There should be several conversion points or call-to-actions (CTAs) on your website and in your key landing pages. Test various CTAs to see what works best. It’s critical to understand your sales and marketing funnels, or customer journey, when developing your CTAs.
What is User Engagement in Google Ads? – This is an indicator of how engaged the user is when visiting your website. Engagement is seen through stats like the bounce rate, pages visited and time on the website. Traffic from outside the U.S. and spam bots can impact these numbers and should be blocked in Google Analytics. Engagement is usually lower for people coming from Google Ads because they may not know your brand. For this reason landing pages matching user intent are very important. Also, your website should be a resource for users and easy to use.
What are Landing Pages in Google Ads? – These are the web pages people go to when they click on a Google Ad. The better targeted the content on these pages to the user intent, the higher the conversion rates. Landing on your website is fine, but targeted landing pages convert at higher rates when they have solid CTAs and best relate to the ads people clicked to get more information and make contact with your company.
What are Display Ads? – These dynamic display ads show up on a variety of websites through the Google Ad network. They have lower conversion and click through rates, but are excellent for branding and expanded reach. The Google Ad network is made up of thousands of websites displaying ads for Google. This is why you see ads showing up on websites related to your recent searches in Google. For example, if you search for tennis shoes in Google, you are most likely to see ads for tennis shoes when you visit a news or information website that is part of the Google network.
What is Retargeting in Google Ads? – This is the online advertising technique used in display ads that follows a user after they click on an ad. This allows ads to display on the next website they visit. For example, a user will click on your Google ads and then go read an online newspaper. A new display ad will appear for your website on that news website. This is called retargeting users in Google Ads. There are restrictions on this approach for some companies by Google.
How does Google Ads Track Phone Calls? – With many searches coming from mobile, it is very common for the phone number on your website to be called by users and tracked as a key CTA. Google has the ability to track phone calls that originated from a Google Ad. Include this in your conversion tracking in your Google Ads account.
Your Website and Landing Pages
Poor landing pages and websites can hurt your brand. This becomes especially painful when you are paying to send people to these pages!
Don’t launch your Google Ads campaigns until your website and landing pages are ready to go.
You must make sure to only run ads when you have excellent landing pages. Your Google Ads key landing pages must follow this checklist:
- Professional layout and design
- Clear tagline in the main banner
- A banner image connected to the tagline
- Static images and content
- Listing at least three key benefits below the header and how you solve user pain and meet their desire
- List your key services or products related to those benefits
- Show your plan for how to do business with you or buy
- Include testimonials, client logos or case studies
- A CTA that works to meet the user’s place in their marketing funnel
- Easy to find contact information with a variety of contact methods
Spend time learning more about website content, how your target market uses resources, website usability and what CTAs work best in your industry. These are the strategies used to improve your landing pages.
Market Segmentation and Personas
This research and analysis is needed to get inside the head of the website visitor and understand their intentions. Personas should be developed for each market segment as they relate to each of your products and services.
Here are a few action items to better understand your target market:
- Determine how people use mobile devices when clicking on ads.
- Write out specific market segments by demographics and create specific personas in each category.
- Develop a brief survey to begin gathering information on users.
- Set up Leadfeeder to track institutional buyers.
There is no doubt marketers who understand their target market get the best results with Google Ads than those who don’t. Are you guessing or have you talked to your prospective customers?
Target Google Ads by Location
One of the best opportunities for solid ROI in Google Ads is targeting by specific regions, states, cities and even zip codes. In fact, you may want to set-up campaigns specifically targeting these areas. If you are marketing nationally, the budget should be maximized for states at a minimum.
Local targeting is one of the great strengths of Google Ads for budget and ROI results.
Another consideration is rural customers who may not have access to your products and services near them. These customers can be targeted by zip code, although they tend to have fewer searches, the conversions rates may be much higher.
Monitor Google Ad Performance by Time and Day
In a perfect world, your company would be open 24-7, just like your website. In reality, most businesses will need time to respond to inquiries from Google Ads. The good news is people understand business hours and tend to spend more time online during business hours. Google Analytics and Google Ad reports provide an accurate gauge for when people visit your website.
Generally, people convert at higher numbers early in the week during normal work hours as Internet usage is highest during the work week. Yes, people are not always working; they are often searching the web for both personal and business needs.
People searching after business hours still want what they need or desire 24-7. For this reason, it is critical you have systems in place for speedy response times when people inquire from Google Ads.
The company that responds the fastest to a lead from Google Ads often earns the business!
However, messaging on the website should be clear. It does not matter when you contact our company, we will respond the next business day if the office is closed. Make response time a competitive advantage.
Google Ad’s Role in Multi-Channel and Cross Channel Marketing and Branding
Users will click on a paid ad to find your company website. They will later return by going directly to your website or by using organic search terms in Google. People use various methods for staying in touch with a brand and need multiple impressions before they move forward with a conversion or before they buy. In addition, they often forget they first clicked on an ad to find your company!
Because of this, all your digital marketing channels contribute to branding and growth and must work together with Google Ads to drive marketing results and sales.
Track brand impressions in search over time and watch for growth from direct and organic traffic, social media and other sources as a result of your Google Ads reach. This is a way to measure the branding impact.
ROI Analysis: Conversions Versus Impressions (Branding)
As we discussed, both branding and conversions are important and budget dependent in your Google Ads campaigns. Conversions are strategically based on ROI and seeing a return immediately for the spend. Impressions are part of a long term strategy and require an investment with a delayed ROI coming months or even years down the road.
As a part of your formula for success with Google Ads, you must take into account both branding and direct conversion when determining ROI. Start by determining what percentage of spend should go to branding. Once that’s done you can use a formula to track what campaigns, Ad Groups, ads and keywords produce the best ROI. Based on this data, you can turn off what does not work and accelerate what does.
Let’s take a look at an example of how this works.
Let’s start with a recommended budget of 20% for branding and 80% for direct conversions to measure ROI. Once you set these parameters a formula can be developed to determine ROI. The ROI formula is as follows:
Average Customer Value (Lifetime Value) – Cost per Conversion (CPC) = Gross Profit
Gross Profit x 20% cost towards branding = Branding Expense per Conversion
Gross Profit – Branding Expense per Conversion = Target Cost per Conversion
Now we’ll plug in a few numbers to see how this works.
Example:
$200 Average Customer Value (Lifetime Value) – $100 CPC = $100 Gross Profit
$100 Gross Profit x 20% (cost towards branding) = $20 Branding Expense per Conversion
Cost per Conversion Target = $80
This means any cost per conversion over $80 may not provide the ROI you desire from Google Ads. This sets a targeted conversion rate cost that takes into account the impact of branding expenses.
Summary
For many companies, Google Ads present a growth opportunity not to be ignored. Google Ads can drive excellent ROI in the targeted opportunities to find new market segments and build awareness about your company. This results in growing sales.
There are many challenges to overcome with Google Ads, yet when the challenges are met, most companies have a tremendous opportunity to reach new markets and grow their sales.
What they need is a winning formula. Put this strategy together and make the formula work for your company.
Strategy + Google Ads Knowledge + ROI Formula = Google Ads Success
One Last Word on GoTo.com
In case you are wondering, GoTo.com became Overture, which was purchased by Yahoo, which was in turn purchased by Verizon. Yahoo sold off their paid search to Microsoft in 2009. What’s left of GoTo.com can now be found by searching on Bing, Yahoo or when using Microsoft Ads.
Action Items
- Outline your Google Ads strategy as defined in this post by using the formulas above.
- Start with keywords, campaigns, Ad Groups and ad content.
- Develop a process for a regular review of Google Ad data and reports.
- Optimize the content and CTAs on your website and landing pages.
- Get a meeting with an experienced Google rep, contact Intuitive Websites for help.
- Determine the percentage of brand impressions in your total Google Ads budget.
- Watch for negative keywords daily in the first week of your campaign launch.
- Determine the percentage of spend going to branding and conversions.
- Set weekly meetings to analyze and review Google Ads results with your team.
- Keep going strong with SEO efforts as they are critical to your digital marketing success and Google Ads compliment organic search results.
