Search engine advertising

1. Search engine advertising MARK 430 Week 8

2. After today’s class you will be able to: • Be able to explain methods of pay-per-click and pay-per-action contextual advertising used in search engines • Understand the benefits of geo-targeting • Understand search advertising ROI • Set up a Google AdWords campaign

3. Search engine marketing recap – distinguishing the two elements • Search engine optimization – managing organic search engine placement by optimizing html pages and devising an inbound link strategy • Search engine advertising and paid placement • Paying the search engines to get the results you want

4. Paid listings Organic listings

5. Paid search versus SEO Paid search SEO Results are gradual – can take months But the results can persist – maintaining position over time Searchers find it more acceptable than advertising Can be complex and may require external expertise One process – many results (tends to bring results across many search engines, not just one) • Results can be seen immediately through increased traffic. • But : no spending = no results • Greater control over which keywords are most associated with their company, brands, products or services. • Additional metrics are available, which means more detailed Web analytics that yield sophisticated knowledge from the data. http://www.iab.net/insights_research/947883/1675/708987 DO BOTH!

6. Search engine advertising • Search engines allow marketers to buy specific key word positions - ie. buy their way to the top • Less consumer resistance that other forms of advertising (but remember that CTR still quite low) • Print directory versus search advertising for SME? • Effectiveness can be directly measured • Speed of execution and “tweaking” of advertising copy • Speed of consumer response • Usually more cost-effective • Continuing strong growth in terms of advertising dollars spent (IAB Internet Advertising Revenue Report June 2013) • Search spending as a proportion of other advertising spend - 47% of online ad spend (IAB October 2012)

7. Search advertising choices • Market share – search engines (May 2013 from Comscore) • Pricing models – with search pricing is almost always based on a performance model • The cost of a campaign depends largely on the keywords, and the competition for those keywords – it is an auction (modified for relevancy in practice) • Pay Per Click – classic search engine pricing model (PPC) • Pay Per Action – (PPA) Google experimented with this in 2007/8

8. Search engine advertising • Web site design or coding has NO impact on position • Position is purchased as part of an advertising campaign - guarantees instant visibility • The website owner has control over: • Position in search results (BUT not always complete control – depends on AdRank in Google) • Keyword choice • Ad listing copy • Landing page • Geo-targeting

9. Buying keywords: search engine advertising – classic Pay Per Click • Keyword bid advertising (usually) works on a cost per click (CPC) / pay per click (PPC) basis • Advertisers pay only when consumers click on their link. • Sponsored links in search results • In simple terms, the company bidding higher on the keyword is ranked higher in keyword search results (in practice, the bid process is more complex). • Google Adwords in action • Effective form of advertising because your target market qualifies itself

10. How is the ranking decided in practice? Google (and more recently Yahoo) uses a combination of the bid price or cost per click (CPC) and the ad relevancy or click-through rate (CTR) • CPC x CTR = Google AdRank • Advertiser sets the maximum CPC per day • If an ad with a lower bid per click gets clicked more often, it will rank higher. • Result - CPC can decrease as an ad becomes more popular, even though a competitor may be prepared to bid more on the same keyword: more clicks = more money for Google. • Ranking can be improved by: • Increasing the set daily CPC • Trying to improve relevancy (and therefore CTR) – How? … Tweak the ad text • AdWords Video: Understanding Ad Rank and Quality Score

11. Keywords / key phrases • Just as in SEO it is all about what people are actually typing into search engines • Create a list of keywords / phrases just as you do for SEO • The big difference is that for search advertising you can target as many as your budget will allow • Research the advertising that your keywords actually trigger • Get sophisticated (think long-tail)

12. Long-tail keywords (based on power law concept) • Distinguish “long-tail” keywords from “head” keywords • running shoes = “head term” • compare grip new balance and nike trail running = “long-tail term” • These search terms have good ROI because they are less competitive and give higher user satisfaction (lower bounce rates?) • Example of a long-tail keyword generator

13. Setting goals for an Adwords campaign • Before you begin to create an Adwords group you need to set goals and metrics (performance indicators so you know you have succeeded) • Adwords Video: Define Success, then Achieve it

14. The elements of a text-based search engine advertisement Title (25 characters max) Click to go to landing page Two lines of text (35 words max) Include a call to action Display URL (35 characters max)

15. Think about your ads…. • Better ad text, better performance – some tips on writing better Adwords advertisements • Each ad campaign is made up of one or more “groups”. An Adwords “group” is made up of one or more ads, keywords, bid placements, and targeting that relate to one campaign “theme”

16. Keyword targeted advertisementsalso served to partner content sites • The keyword-targeted advertisements appear not just in the search engine results pages, but on the “content network” • Major players in PPC search engine advertising • Google works with an affiliate network • Google search engine • Google maps • Content partner network • AdSense publisher network • Microsoft / Facebook alliance

17. Advertising across the Google network with Adwords • Google Adwords Advertising types • We will look at these in a minute when we consider Adwords from the web publisher point of view

18. Geo-targeting • Very cost-effective and highly targeting method of using search engine marketing • Especially useful for: • Small businesses whose target markets are in particular local areas • Bricks and mortar businesses • Allows you to target your advertisement to • Particular geographic locations • Particular languages • Geo-targeting - Bob Nicholson (4 minutes)

19. Advertising metrics: ROI and CPA • ROI = Return on investment • CPC = Cost per click • CPM = Cost per thousand (impression) • CPA = Cost per (customer) acquisition • Google Analytics and AdWords are very strongly tied together

20. Managing multiple campaigns across different ad networks • Larger companies will likely have campaigns with Google, Yahoo! Search Marketing and MSN, Bing, Facebook etc • Need software tools to help manage multiple ad networks and bids

21. Advertising for web publishers • Google AdWords – for marketers • Google AdSense – for publishers – Google’s content network - % of CPC paid • Ads are matched to page content, not search terms – • Different ad formats available, including video ads – Samples • How AdSense works (video)

22. Click fraud • PPC lends itself to click fraud because of its structure • Advertiser pays the advertising network, which in turn pays the publisher • Click fraud = clicking on a paid advertisement for a fraudulent or non-legitimate purpose • By a human, an automated script or a computer program – an example • The advertiser pays, the search engine company can be said to benefit (apart from paying out a % to the publisher)

23. Why click fraud? • Two main types of click fraud: • Search engine click fraud: artificially raising a competitor’s marketing costs or exhausting their budget to remove them from their position in the listings (usually on very high cost or competitive key terms) • Publisher click fraud: artificially raising a publisher’s income from AdSense • Estimated 10% to 15% of ad clicks are fake, representing roughly $1 billion in annual billings (Business Week, 2006). • Search firms have put tools in place to detect and prevent click fraud (but have still been sued by advertisers) • Where are we now with click fraud? Stats for 2012 • Mobile clicks in error are now an increasing problem

24. Advertising using other firms brand names as keywords • It used to be that if you typed in Harvard Business Review you got Adwords advertising for McKinsey Quarterly • Legal in the US and Canada? • Ethical? • Google Trademark Complaint process

25. Hands on practice • Explore Google AdWords, research a PPC keyword campaign, and get some practice in designing text advertisements • AdWords Home • Google Adwords: How to create a campaign, set up ad groups, and types of advertisements