PPC Bidding:How to Get an Extra 10% from Your Account | Pete Whitmarsh | SearchLeeds
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The document discusses how to optimize paid search bidding to increase profits by 10%. It recommends setting targets based on business logic, aiming for the highest profit point on the bid-profit curve, and not limiting bids due to budget. It also suggests calculating bid prices based on conversion rates and profit margins, grouping similar keywords, and moving from last-click attribution to better models. Following these guidelines could help maximize returns from a company's paid search campaigns.
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PPC Bidding:How to Get an Extra 10% from Your Account | Pete Whitmarsh | SearchLeeds
- 1. © SEARCH LABORATORY LTD | ALL RIGHTS RESERVED LEEDS HQ: +44 113 212 1211 LONDON: +44 207 147 9980 NEW YORK: +1 646 473 1826 PPC BIDDING: HOW TO GET AN EXTRA 10% FROM YOUR ACCOUNT PETE WHITMARSH
- 2. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD WHO AM I? Head of Paid Media Search Laboratory 7 years’ experience Maths degree Pete Whitmarsh
- 3. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD WHY FOCUS ON BIDDING? Often overlooked Hugely important
- 4. ANATOMY OF A BID PRICE
- 5. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD BID PRICE - 1.0 2.0 3.0 4.0 5.0 6.0 £- £0.20 £0.40 £0.60 £0.80 £1.00 £1.20 £1.40 £1.60 Position BID PRICE VS POSITION As you bid more, position increases Position
- 6. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD POSITION VS CLICKS As position increases, clicks increase Position Clicks -1.02.03.04.05.06.0
- 7. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD Position POSITION VS CONVERSION RATE As position and clicks increase, conversion rate stays the same 1 2 3 4 5 6 ConvRate
- 8. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD BID VS PROFIT Profit As bid increases, profit increases then decreases Highest ROAS Lowest CPA Highest Volume Highest Revenue Highest Profit Bid
- 9. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD BID VS PROFIT …but the curve can be many different shapes Profit Bid
- 10. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD BID VS PROFIT …but the curve can be many different shapes Profit CPA
- 11. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD BID VS PROFIT …but the curve can be many different shapes Profit Budget
- 13. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD RULE 1 Targets should be based on BUSINESS LOGIC Targets derived from Average Order Value Profit Margins Cancel / Return Rate Offline Sales Lifetime Value
- 14. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD RULE 2 Targets should aim for the top of the graph Regularly change Understand the curve Profit Highest Profit CPA
- 15. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD RULE 3 Targets should not be hampered by budget
- 16. CALCULATING A BID PRICE
- 17. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD CALCULATING A BID PRICE CPA Target × Conversion Rate = Click Price Or… Average Order Value ROAS Target × Conversion Rate = Click Price
- 18. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD Keyword Clicks Conversions Conversion rate Bid price Pies 5000 125 2.5% £0.25 Steak and ale pies 210 7 3.3% £0.33 BIDDING EXAMPLE £10 CPA target CPA Target × Conversion Rate = Click Price
- 19. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD BIDDING EXAMPLE Clopper-Pearson method Keyword Clicks Conversions Conversion rate Bid price Pies 5000 125 2.5% £0.25 Steak and ale pies 210 7 3.3% £0.33 95% confident that the conversion rate is between 1.35% and 6.75% 95% confident that the conversion rate is between 2.14% and 2.86% https://goo.gl/23znKR
- 20. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD BIDDING EXAMPLE £10 CPA target Keyword Clicks Conversions Conversion rate Bid price Pies 5000 125 2.5% £0.25 Steak and ale pies 210 7 3.3% £ Minced beef and onion pies 175 7 4.0% £ Chicken and mushroom pies 120 6 5.0% £ Meat and potato pies 125 9 7.2% £
- 21. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD GROUPING DATA Group specifics together Keyword Clicks Conversions Conversion rate Bid price Pies 5000 125 2.5% £0.25 Specific pie types 630 29 4.6% £0.46 Steak and ale pies 210 7 3.3% £ Minced beef and onion pies 175 7 4.0% £ Chicken and mushroom pies 120 6 5.0% £ Meat and potato pies 125 9 7.2% £
- 22. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD GROUPING DATA Group specifics together Keyword Clicks Conversions Conversion rate Bid price Pies 5000 125 2.5% £0.25 Specific pie types 630 29 4.6% £0.46 Steak and ale pies 210 7 3.3% £0.46 Minced beef and onion pies 175 7 4.0% £0.46 Chicken and mushroom pies 120 6 5.0% £0.46 Meat and potato pies 125 9 7.2% £0.46
- 24. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD ADWORDS ATTRIBUTION 97% of marketers use last click attribution. Only 14% of them are satisfied with it. (Source: Google Internal Data)
- 25. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD ADWORDS ATTRIBUTION – WHY BOTHER? Better bid optimisation Huge impact on performance Easy
- 26. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD HOW DO YOU TRAVEL? Taxi to station Train to airport Flight Bus to city Walk to hotel
- 27. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD HOW DO YOU TRAVEL? Taxi to station Train to airport Flight Bus to city Walk to hotel 100% of credit!
- 28. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD WHICH MODEL TO USE? Last Click First Click Time Decay Linear Position Based Data Driven
- 29. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD WHICH MODEL TO USE? Time Decay Linear Position Based Safest first step away from last click Fair and even / moderately aggressive Aggressive / adds value to early funnel
- 30. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD ATTRIBUTION Search 1 Search 2 Search 3 Conversion “Pies” “Wholesale Pies” “Pukka Pies”
- 31. SUMMARY
- 32. PRIVATE AND CONFIDENTIAL © SEARCH LABORATORY LTD SUMMARY Set sensible targets Understand statistical significance Group keywords together when needed Change from last click attribution
- 33. SEARCH LABORATORY LTD. GLOBAL DIGITAL MARKETING EXPERTS facebook.com/searchlaboratory/ @searchlabs linkedin.com/company/search-laboratory/ Email: info@searchlaboratory.com SEARCH LABORATORY LTD. GLOBAL DIGITAL MARKETING EXPERTS Leeds HQ: +44 113 212 1211 London: +44 207 147 9980 New York: +1 (646) 473-1826 Web: www.searchlaboratory.com CONTACT DETAILS
Editor's Notes
- Responsible for team of 25 PPC, Programmatic, Paid Social and CRO across Leeds and New York
- We inherit lots of accounts and often see bids as not being a great area of optimisation Why it’s important to clients as well
- Looking at data from internal studies that we’ve done
- Not true for 100% of cases best to use this as the truth unless there is any evidence to prove otherwise
- This is absolutely key Position 1 not always best So – the point of a bid review is to find the maximum point on this graph
- This is absolutely key So – the point of a bid review is to find the maximum point on this graph
- This is absolutely key So – the point of a bid review is to find the maximum point on this graph
- This is absolutely key So – the point of a bid review is to find the maximum point on this graph
- Really important to have a target to set an appropriate bid
- If lead gen then look at lead to sales If flat CPA target across entire product range then something might not be right
- Challenge and change your logic
- The best way to work in PPC is to have a target and maximise what you can get for that target
- Focus on CPA through these examples
- Explain how this gives £10 CPA Data comes from AdWords Margin of error too high
- Going back to this example… Really not enough data for the second keyword Very wide range The two ranges overlap, which means there is no evidence to suggest that the second keyword is any different to the first In this instance, you’re best to just bid the same as you do for “pies” until the data proves otherwise
- NOT Cross channel –although this is hugely important This is purely attributing the conversions within AdWords to allow for better bid decisions
- NOT channel attribution NOT going to give AdWords any undue credit
- Last click attribution gives all credit to final occurrence
- 15000 clicks 600 conversions Last 30 days
- 15000 clicks 600 conversions Last 30 days
- Having this data helps you to understand which keywords to bid on Which keywords your bid should be weighted towards