When I’m managing an AdWords account, I can sometimes forget where these ads are going.  A whole lot of AdWords isn’t visible from the user interface.  It’s easy to look at cost per clicks, conversion rates, bids, and ad positions – without really doing a check on the actual substance behind it.  Especially because I’m comfortable with submitting ads and keywords, without having to worry that my ad will actually show on Google and that things will run the way I expect.  But this whole user-interface vacuum, strips away some important performance predictors/indicators:

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There is a question that many newer consumers of paid search products face: How much should I rely on automated tools for management and generation of paid search ads and keywords?

It’s one that can’t be answered with a simple yes or no. Both approaches have their pros and cons, and in my opinion, it’s likely to stay that way. While technologies may come closer and closer to reproducing the ‘gold standard’ of human judgment, accuracy for most automated numerical and natural language tasks continues to lag behind humans, at least for small to moderate paid search accounts.

Human vs Automated Paid Search

This trend reverses when you are working with very high volume accounts (websites). When your paid search visit conversions are in, say, the thousands per campaign, you’ll have a better chance of benefiting from the automated tools. Imagine, for example, what you would pay X paid search professionals to manage 500 campaigns, each of which saw thousands of conversions.

Still, before you go about firing the humans and automating even big accounts, you should inform yourself about a tool’s constraints and abilities. Disambiguating important concepts that pertain to your market, for example, is a process where automated tools tend to lag behind. Advertising on the phrase ‘black leather belt’ that an automated tool deems relevant to your market, when you actually sell ‘black belt six sigma’ courses, is not money well spent. Know enough about the tools you use to prevent these types of mishaps.

Automated tools also may come with limits that prevent you from choosing the budgeting. Omniture’s SearchCenter, for example, requires optimization for a price per conversions, and can’t be capped at a specific level per month, to spread out over a month. Naturally, clicks can’t be guaranteed at any given time, but tools that allow the maximum flexibility of budgeting, such as capping and distributing evenly as possible, are the most useful. Sometimes it just isn’t possible to take the market by storm, even if there might be potential customers out there.

Whether automated or human, paid search management requires some ability to detect anomalies, and to hold on spending when highly unlikely patterns suddenly lead to large spending. Find out whether automated tools are equipped to self-pause, or whether your human paid search manager will be accountable on off-hours for period checks on spending.

In short, human search is a tremendously valuable approach, especially when supported by automated mechanisms. This is particularly true now, as more and more affordable and even free automated tools exist, such as  Google Adwords’ Keyword Tool, Google Adwords Desktop Editor, Google Insights for Search, Keyword Discovery, and Google’s Bid Management tool Conversion Optimizer.

Click fraud is the bane of my existence. And NOT because it’s actually a problem. The PROBLEM is that every time a fear-mongering article comes out about click-fraud, I no longer get to talk about how we can help businesses grow. Instead, I get to spend my time talking people down out of trees. To put it mildly, it gets in the way of our goal to transform the Michigan economy one business at a time.

I am inspired to address the issue of click fraud after reading this New York Times (NYT) “article” (it’s actually an ad, but someone forwarded it to me that thought it was an article, so clearly the advertiser got their money’s worth). The ad takes the typical assault on Google AdWords to a whole new level. It quotes the director of the Center for Digital Democracy, which claims Obama ought to immediately address the issue:

Click fraud should be at the top of the priority list with Obama and the F.T.C.

Here’s my unusually unabashed take: if your paid search suffers from click-fraud, well… somebody isn’t doing their job. (And I’m not talking about Obama!)

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I consider myself to be all about change (even before Barack Obama) and feel like if I don’t shake things up in my life every few months then things will get boring. So, you would think when I found out about the new AdWords interface that I would be one of the first on board, but I’m not. I can’t figure out exactly why I’ve resisted using the new interface, but I know part of the reason is because I’m so used to the old interface when I’m not working in the Desktop Editor. This week I finally buckled down and faced this change head on and decided to start using the new interface with a couple of my accounts, after all we are all going to be forced to use this new interface soon.

The new interface looks like the Desktop Editor in terms of navigation. There is a navigational tree along the left that allows you to quickly jump from ad group to ad group and campaign to campaign. In my opinion this is a big improvement over the old interface because the most time consuming thing was moving throughout a large account and waiting for pages to load. Anther big change in the new interface is the addition of graphs that look a lot like Google Analytics graphs. This should make it easier to identify trends in your AdWords accounts where with the old interface you had to either generate reports look at the change history or look at Analytics data to identify long term trends. I imagine these graphs could be very useful for monitoring accounts, but I haven’t found anything interesting yet. Another change that I like is that you can actually edit keywords, previously if you wanted to change a keyword’s matching or spelling you were forced to delete the term and add the changed term back to the account.

So you might think, wow there’s a bunch of new useful features, I should switch to the new interface right away, but not so fast. One of my biggest gripes is how much information is crammed into the new interface window. I have a fairly large monitor (1680×1050 resolution) and I noticed that I needed to have my Firefox window taking up most of the screen in order to see all the information within the new interface. So, I decided to set my screen resolution 1024×768 (which is what a lot of internet users have) and my hunch was correct that it is terrible to navigate throughout the new interface unless you like scrolling left and right as well as up and down. Another big issue I have is just moving around the new interface is choppy and overall pretty sloppy. The new interface is beta like most Google roll outs, but from what I hear they are switching to this new interface in the next few months, so I hope these issues are fixed before the launch. Maybe it’s because I’m using Firefox and on a Mac but even so I don’t think this is ready for prime-time. Overall it has some good new features, but I am not sold yet. Has anyone else used the new interface? I’m interested to know what other people think.

The minutia of technology news tends to distract me from the big picture. The specs of the new Macbook, AMD backing off the move to next generation chips, plans for a YSM or adCenter Desktop Editor, the widget that makes you look like Shepard Fairey’s Obama portrait…etc. I’d like to briefly reflect on the big picture, and momentarily shelve my enthusiasm for the latest and greatest.

As of yesterday, America has a new President. What do you think about the new administration’s technology goals? I think I see Eric Schmidt’s fingerprints on some of those priorities, particularly health informatics and energy ideas that overlap with Google.org goals. It’s interesting to see network neutrality prioritized; it’s right at the top of the page. [Here's a Washington Post article on the subject. Tech Crunch has a pretty good piece too.]

The issue as I understand it: should website owners pay telecoms for higher levels of service, to make their sites run better than their competitors, and help those companies like Verizon, ATT, pay for their networks by doing so…

Now, fair warning, I’m going to try to incorporate this big picture stuff to Pure Visibility’s business.  I often think about democratic aspects of online experience. And I think the text ads that Google, Yahoo & Microsoft display, are pretty democratic. Yes, they use an auction system, so you pay for higher visibility. But regardless of who the advertiser is or how much they bid, their text ad will be four lines of text. At Pure Visibility, we talk regularly about goals for what we do. The co-founders of the company, Catherine and Linda, are very community oriented, and dedicated to helping Michigan businesses grow. I like that text ads provide an effective opportunity that scales well for businesses of all sizes to reach customers online.  I like that the barrier to entry is such that is system is a viable opportunity for companies spending millions of dollars a year, or only a few dollars a month.

At Tuesday’s marketing roundtable at Spark Central in Ann Arbor the panel had a very interesting discussion about the future of mobile marketing. They talked a lot about geo-targeted ads that are sent to a potential customer’s cell phone who has opted in to receive such message.

This got me wondering how paid search will work on mobile devices. One option is Google Mobile ads which are designed to appear on mobile websites but what about the growing number of iPhone users that don’t access mobile websites rather they view standard HTML? We can assume they will see paid search ads the same way we view them on a desktop computer. The next question is how many mobile internet users use search engines. A study done by iCrossing showed that 75% of mobile web users conduct searches, which in theory means traditional paid search ads will display 75% of the time mobile web users get online. This is a big number so I think it’s important that paid ads are displayed accurately.

Is a 3” screen is really large enough to be effective with paid ads? First of all I would think you need to zoom in to read any of the search result listings on a cell phone. Regardless of legibility the first 3 paid ads above the organic listings are still be prime real estate but once zoomed in I would think the paid ads along the right hand side wouldn’t be visible. This got me to wondering if cell phones are truly going to be the only way we get on the internet are we really going to settle for that small screen?

At Pure Visibility we work off mobile laptops but when we get in to work we typically plug in out computer to bigger monitors to make it easier to read in addition to keyboards and mice. I am a believer that in the near future both desktop and laptop computers as we know them are going to be gone and replaced by powerful mobile sized computers. If you think about it we are already there. Apple’s iphone, Google’s android, and Blackberrys aren’t just cell phones, they are computers. Once a cell phone/computer is as powerful as my laptop why would I lug around my laptop to and from work and travel? I could just carry the mobile computer and while at work plug it into a bigger monitor with keyboard and mouse. I could have the same set up at home so that I could work quickly and efficiently there too. This would also solve the problem of the screen size and paid search advertisements when I’m working from a stationary place. Some people are speculating that our mobile computers will have screens in front of our eyes that track our eye movement and allow us to control the computer. Sounds too far out for me, but I really like the idea of my work computer being able to fit in my pocket because it means commuting by bicycle is that much easier. My prediction is that paid ads won’t be as effective for people searching on the go, but as far as a mobile internet and a standard internet I think we are heading to standard internet and this idea of a different mobile web will become irrelevant.

When I started in pay per click marketing in 2005 the first thing I wondered was “who are these people clicks on sponsored links because I sure the heck don’t.” Often when I explain to people what I do at my job they react in the same way that I did, “people actually click on the paid ads?” The short answer is yes, a lot of people DO click on sponsored/paid advertisements. I am the type of person that is pretty good at tuning out commercials on TV, so when the internet got popular I thought I could apply those same skills, only now I need to block out banner ads and paid ads. Many friends and co-workers say that they are exactly like me, but if this is the case then who are all of these people clicking paid ads?

My hypothesis is that we only think we are avoiding PPC advertisements but a majority of us are actually ingesting them. One of the reasons I believe this is because of the heat-map study done by Marketing Sherpa. As you can see to the left, it is natural for a majority of people to catch some of those first 3 paid advertisements that appear above the organic search results. You can see that very few people look at the PPC advertisements along the right hand side so maybe these are the ads people think they are avoiding?

Another reason why I know people are not avoiding PPC ads as much as they think is because of the shear amount of clicks we see in our PPC accounts. For most of my accounts the only limit to the amount of clicks a client can receive depends on their budget and which words they want to bid on.

Another interesting discovery I found while examining the heat map image was the heavy amount of focus on the number one organic listing. The orange/reddish areas represent the heavy eye tracked areas and they fall on the number one spot. It’s no wonder why everyone wants to be number one for all the search terms that represent their company, but we know it’s not possible to be number one on a lot of terms (especially with wikipedia.) For terms where it’s impossible to reach the number one organic spot a strategy might be to rank in the top 3 paid results. Actually if you believe that most people skip those first 3 paid ads you might use a strategy of targeting the number 3 spot because it is so close to the first organic listing. This could possibly explain why many paid search specialists like me try to achieve 2-4 ranking on many keywords and we see great ROI in that position.

So, whether you examine a heat-map or an actual paid search account you will see that many people do click on paid search advertising and as long as search engines dominate the internet, paid advertising will be a huge business. As far as who exactly is clicking on those paid search ads, I don’t know, it may be you.

Hal Varian, Chief Economist for Google, Berkeley Professor, author of the awesome book Information Rules and amateur Sam Eagle impersonator, tears down a white paper by an SEM company that predicts that the deal Yahoo made to serve Google ads will cause a 22% increase in Yahoo PPC bid prices. Varian asserts that the defects in the paper’s methodology make its conclusions about as legitimate as a $50 Rolex.

Whew, I’d hate to be those guys. The thought of going toe to toe with Varian is terrifying. But Professor Varian’s critique of the study does nothing to address advertisers concerns that changing the bidding structure will impact the price of advertising on Yahoo keywords.

Ask Jeeves partnered with Google to serve ads on Teoma and other products back in 2002. They determined whether to display an Ask Jeeves ad or a Google ad by the $$$$ they’d receive. Expensive ad goes to the top. Makes sense. Professor Varian says that Yahoo has a “strong economic incentive” to serve their own ads rather than Google’s; full share vs. partial share of profit. He also points out that Google and Yahoo won’t be able to see one another’s bid prices.

But neither company has detailed how their ad services will be integrated. Advertisers make higher bids for Google than Yahoo; it’s not unreasonable to speculate that Google and Yahoo might adopt a bidding model that would result in advertisers driving up prices on Yahoo keywords. There has been no information on the workings of the bidding system that demonstrates that this won’t occur.

Here’s Google’s press release about the agreement to provide ads for Yahoo. http://googleblog.blogspot.com/2008/06/our-agreement-to-provide-ad-technology.html

Here’s Yahoo’s press release on the same subject.

http://yhoo.client.shareholder.com/releasedetail.cfm?ReleaseID=316450

Search Engine Watch Article about Google deal to provide ads for Ask Jeeves
http://searchenginewatch.com/showPage.html?page=2164921

Seth Godin posted a couple of thought-provoking blog posts recently about online ads: Ads are the new online tip jar and a follow-up, Beating the status quo.

What Godin proposes is, when you read a blog, “if you like what you’re reading, click an ad to say thanks.” If everybody engaged in this behavior, it would over time change the model of online advertising so that ads would pull in more people but they would be less well qualified.

He writes that your landing page gives you the opportunity to “immerse someone in an entire page you designed. In other words, a chance to convert mild interest into big interest.”

This is the part that is particularly interesting to me. The idea of landing pages (at least at this time) is it fulfills the promise made in the ad the user just clicked on. The ad is meant to pull in only people that are interested in learning more. The landing page, in turn, is meant to speak to people who found the ad interesting and want to learn more about the product that was advertised or finding a solution to a problem they experience. Godin’s vision entails people clicking on ads that they don’t actually care about.

We would be challenged to put together landing pages that speak to the casual visitor. We would have to grab the attention of these less-motivated visitors immediately to keep them from leaving. When talking about the product or service, different messages will appeal to different people, but the more messages you try to pack into a landing page, the harder it will be to get through to visitors.

The answer, then, may be to try to suck in visitors through content that is entertaining instead of presenting a purely informative page. Will that strategy work for every business, though? Perhaps the answer lies in crafting the message on a landing page to clearly and loudly tell visitors why this landing page is worth their time.

Godin’s idea intrigues me but I am not convinced. He proposes that the value of this new model to advertisers would be “begin[ning] to reach the unreachable non-clickers.” It will be hard to reach visitors whose motive for clicking on an ad is not to learn more about what you are advertising, but rather to generate income for the blogger whose work they enjoy.

At long last we are thrilled to announce the release of O’Reilly Media’s Website Optimization: Speed, Search Engine and Conversion Rate Secrets. This book details search engine marketing best practices: showing readers how to optimize their conversion rates and performance tune their websites to boost the return on any Web site investment.

This is the second edition of a book written by Ann Arbor, MI website optimization guru Andy King. In this edition, Andy tapped us to contribute two chapters: Chapter 3 – Pay Per Click Optimization and Chapter 4 – PPC Case Study featuring our work for Body Glove Mobile Accessories Group.

Our Pure Visibility team learned a lot throughout the course of writing these chapters, personally, I was amazed at how much hard work and revisions go into putting out a finished bound copy. The hard work was worth it and I’ve never seen a book with such an in depth and thorough analysis of PPC marketing. We are confident that if you have an interest in Pay Per Click Optimization or Website Optimization you will learn a ton from this book.