Recently an
SEOChat forum post spurred an analogy relating to explain Google Adwords and when an advertiser should lower or raise his/her maximum cost-per-click. With a little
Ren Fair Flair thrown into the mix, it's easy to see what's important and what's poppycock. Read on as I answer one person's predicament on when to lower his maximum cost-per-click.
I currently am getting a CTR of about 2.3%. I'm averaging a position of about 6.8. Should I lower my CPC, or should I work on building up my CTR first?
Thanks,
mhsiao45
My Response
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Conversion is King - Click-Through Rate is Queen
Keep an eye on your conversions and cost-per-conversion. If conversions go up as you bid more and your position increases, then you have found your scaling point and you can keep expanding your empire as long as it cost you less to gain a customer than the price of your products/services. If conversions go down, you have several other variables in which to experiment.
Text Ads are Knights - Let them Battle to Prove Who's Worthy
If your ads convert less by bidding higher, which is typically the case, then bid the same as you were, but A/B split test your ads to get the best possible click-through rate. You should always A/B split test anyway.
Don't Declare a Winner After Just One Joust
Make sure you give it a long enough time period to compare the two ads. The more volume of clicks, the less time you have to wait to get an accurate test. Give it at least two weeks of testing (unless you average 100- 200 clicks a day on those ads) before nixing the inferior ad. Then write a new ad and pit it against the proven winner.
Don't be Fooled by the Statistics Court Jester
- Change the data date range to view the last two weeks.
- Check your serving percentage of the two ads (should be very close to 50%)
- Make sure a majority of your clicks did not come from the Content Network ( I personally think one should separate Search campaigns from Content Network campaigns).
- Make sure there is stark difference in Click-through rate, if not give it another week. Then even if there is a minute difference in click-through at least you gave your due diligence to the ad.
By default Google will "optimize and show the better performing ad more often." I turn this default function off, because it typically judges the ads too fast. To change this, select campaign(s) by using the check box, then chose "Edit Settings." You'll see that you can change to "show ads more evenly." Choose that option every time for every new campaign.
If you follow this guide, Google will reward your keywords with a good quality score, a click-through rate fit for a king, and higher placement at a lesser cost-per-click. With the best possible ad on the page, soon you will be paying less and less and getting higher and higher. This will ultimately give you many more clicks for your money.
Good luck and keep testing your ads.
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