8 tips for optimizing in-house PPC campaigns

The decision to bring a pay-per-click campaign in-house can be a daunting one. Many small- to medium-sized companies may not be able to justify the expense of hiring someone to do it. Or maybe an agency just "doesn't get" your company, your customers, and your processes.

On the other hand, you may need that expertise and knowledge to make a PPC campaign work and deliver a reasonable ROI, right? That's the situation I faced when I made the decision to bring my company's campaign back in-house after working with two different agencies. It has been two years, and in that time, our sales are up an average of 25 percent per year for 2008 and 2009. Certainly there are other forces at work here, but an effective in-house PPC campaign is a major factor.

Our embroidered logo apparel company is currently managing campaigns on Google, Bing, and Business.com totaling more than 1,400 keywords. For the top 20 percent of our keywords (the ones driving the most conversions) our click-through rate (CTR) averages 14 percent and our conversion rate averages 17 percent. So how have we arrived here?

Success in the PPC arena starts with having a solid marketing skill set. Good marketing, not good technology, drives PPC success and ROI, and once you have a solid marketing foundation, success in PPC is much easier. The fundamentals of marketing include 1) knowing your customer and 2) knowing your value proposition or your unique selling proposition. PPC advertising is just a vehicle for you to deliver that message to your target market or customer.

If you or your organization has a strong marketing skill set, managing the campaign in-house and delivering a strong ROI can work for you. If you do not, managing a PPC campaign in-house might not be a good fit for your company.

The PPC learning curve is steep, but not impossible to climb as long as you concentrate on the fundamentals. There are more than enough resources available in the marketplace to teach you the mechanics of creating and managing a PPC campaign. Here are eight tips to help you get started:

1. Learn the ropes
One of the books I started with was "AdWords for Dummies" by Howie Jacobson. I am generally not a fan of the "for Dummies" series, but this author does a really good job laying out the fundamental techniques for PPC.

I also recommend attending a PPC conference. I have attended three in the past four years and I learn something new each time. My personal favorite is PPC Summit, but there are others available across the county. When choosing a conference to attend, look for one that is specific to PPC. A more general search marketing conference with a PPC component might not give you enough "in-the-weeds" information.

As with most things, you have to stay on top of it. The learning is continuous. I attended a PPC Summit this fall and was amazed at what I learned even though I have been doing this for some time. As with most things related to the internet, change is constant.

2. Stay focused
If your company offers a wide variety of products, it would be really easy for a PPC campaign to get out of control. The narrower your product or service offering, the easier it is to achieve good ROI.

I know Facebook and Twitter are all the rage right now, but I have hesitated adding them to my marketing arsenal. One of the reasons: I don't want them to become a distraction for me. For my company, PPC really moves the needle in terms of sales and ROI. I want to make sure I am maximizing my PPC efforts before adding another technique to the marketing mix. I am a firm believer in doing fewer things well, versus trying to do many things only marginally well. 

3. Increase ROI
There are a number of strategies to drive up ROI. In the early days of PPC, CTR was the metric that everyone counted and measured. But that has changed. Number of clicks matters less if people aren't buying or converting. Conversions matter more than clicks. Cost per conversion is what you need to concentrate on to drive ROI. How do you do that? Keep reading.

4. Manage your keywords
Not all of your keywords are converting at a cost-effective level. Work to lower that cost by testing different ad positions, ad copy, landing pages, etc. But at some point, if that keyword is still not performing, you have to get rid of it and concentrate on others that are more profitable.

5. Test ad positioning
Test the position of your ad listing. Some keywords might convert better in position four versus position two. And position four is cheaper per click than position two. True, you may get fewer clicks, but they might be better quality clicks.

6. Experiment with geo-targeting
One strategy that I am testing right now is geo-targeting. I have taken my cost per conversion to a state level. Some states convert well, and others don't. Therefore, I do not advertise in those states where my conversions are more expensive. I have chosen to do this on a state level, but it can also be done using countries, regions, cities, and even neighborhoods.

7. Improve your quality score
Your quality score on Google affects your cost per conversion. The lower your score, the more Google is going to charge you for a click. Work to raise your quality score and that will lower your cost. Any quality score less than seven is hurting your campaign.

8. Try other search engines
There's no question Google is the 800-pound gorilla in the room. It has the most searchers and can deliver the most eyeballs. But conversions on Yahoo, Bing, and others cost significantly less. My conversions on Business.com cost half as much as my conversions on Google. Granted, the traffic delivered by the other search engines might be less than Google, but to drive ROI, you have to consider quality as well as quantity.

There are more ways than ever to increase the ROI of your PPC campaign. But don't get sucked into the idea of "best practices." What works for my campaign might not work for your campaign. We have different customer problems to solve, different value propositions, and different campaign goals.

The best way to find out what works for you is to test different options. That requires some planning and work, but it will most certainly pay dividends in the end.

Jeff Taxdahl is founder and president of Thread Logic.

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Comments

Jeff Taxdahl
Jeff Taxdahl March 10, 2010 at 9:46 AM

Gregory, thanks for the comments. In my experience you are right on about all your points.

Thanks for the contribution.

Jeff Taxdahl
Jeff Taxdahl March 10, 2010 at 9:44 AM

Dave, you are absolutely correct. It is amazing how many companies don't do this. We decided with this article not to go down that road and keep it more at a "basic" level. But landing pages are a very important part of the strategy.

Thanks for your feedback.

Dave Finkelstein
Dave Finkelstein March 10, 2010 at 7:41 AM

Hi Jeff,

Great Post Jeff, You mentioned conversion but not building and constantly testing great landing pages. So many companies just direct clicks to their home page or some other non specific to the query page.

Gregory Geny
Gregory Geny March 9, 2010 at 11:06 AM

Interesting article Jeff. As someone who has been managing PPC campaigns for 7 years and spends around £1.5m/year on major search engines, I would like to add a couple of things:

1. One of the main strategies to drive up ROI is to lower your CPC. Since the CPC is a function of the next ad rank (advertiser below you) and the quality score, increasing the CTR will increase your quality score, your ad rank as well as decrease your CPC - therefore increasing your overall CR.

2. When experimenting with geo-targeting, I would recommend setting-up separate accounts as search patterns and conversion rates can vary greatly from one county to another. This will also ensure the new geo-targeting does not impact your current campaigns in a negative way

3. Improve your quality score by increasing the granularity of your campaigns, ads and landing pages. If you sell "running shoes" and have dedicated campaigns for each brand (e.g. Nike running shoes, etc.) why not try and break this down even further (colour, style, etc...).

Hope this helps!

Sue Reddel
Sue Reddel March 1, 2010 at 2:22 PM

Thanks Jeff, as someone who's just getting started with PPC, but has marketing experience, this much appreciated advice.