Core Concepts of Paid Search Marketing

Microsoft Confidential

Core Concepts of Paid SearchJohn Gagnon

@jmgagnon

@jmgagnon @bingads

Step back. Look up.

@jmgagnon | @bingads

Step back and look up

Black Friday in the parking lot

@jmgagnon | @bingads| #SESDenver @jmgagnon

John Gagnon

BLOGGER

FORMER GOOGLE GUY, SEARCH CAMPAIGN MANAGER, DATA ANALYST

SPEAKER

@jmgagnon | @bingads

How much do auto insurers pay per click to run their ads on Bing?

Microsoft Confidential @jmgagnon

Keyword:

Cost per click: $50+

Cheap Auto Insurance

Microsoft Confidential @jmgagnon


What we’re talking about today

Ad CopySearch FunnelValue a Click

@jmgagnon

People Looking for

Products/Services

Business Offering Services

Willing to pay

Right info

Right time

Good exp.

@jmgagnon


Anatomy of a search page:

Query, Search term, Keywords

Sponsored results (paid ads)

Organic results (non-paid listing)

Local listing, free tobusinesses that sign up

@jmgagnon

On Bingclick-through-rate for the #1 search result is 9.7%. For the #4 result,it drops to 1.9%.3

60%of all organic clicks go to the top three organic search results.2

75%of users never scroll past the first page of results.1

Why is SEO and SEM such a big deal?

SEO and SEM has one goal: To move websites to the top of the search results page.

1. HubSpot May 2012; 2. Marketingsherpa, February 2007;

3. Slingshot SEO December 2011Microsoft Confidential @jmgagnon

How much does Jimmy Choopay per click to run shoe ads on Bing?

@jmgagnon

How much does Jimmy Choopay per click to run shoe ads on Bing?

Keyword:

Cost per click: $1-$2

Jimmy Choo Shoes

@jmgagnon


Why: Margins + customers, not clicks

@jmgagnon

Product Revenue

$150 - $400per month for 6+

$600+

Margin

$400

$100

Of 100 Clicks,

how many Sales

12

1-2 prefer buy in-store

window shoppers

Compare online

and buy

Product

Auto Insurance

Jimmy Choo


Translate business terms into online marketing concept

@jmgagnon

CPA

$400

$100

Conversion Rate

12% or 0.12

1% or 0.012% or 0.02

Cost per Click

$48

$1.00

$2.00

Margin

per Sale

Sales per

100 Clicks Pay per Click

Product

Auto Insurance

Jimmy Choo


Above the fold or below the fold:

where would you rather be?

@jmgagnon

There’s good reason to fight for the top

73%19%6%2%

@jmgagnon

0

100

200

300

1 2 3 4 5 6 7 8 9 10

Clic

ks

Position

Example: Number of clicks by Position

@jmgagnon


Be #1: Break even CPC

@jmgagnon

Advice: “Start with a Joke”Perfect! There are 1000’s of Lawyer Jokes!

@jmgagnon

Introducing... Negative KWs

How much moneyyou make per action

Conversions per click

The most you can responsibly pay for a click – and still make money

CPA CVRx = Break-even CPC

Calculate your break-even CPC

@jmgagnon

Break-even CPC

= $1

Break-even CPC

Sale price: $35

Cost to London Fog-$10

CPA $25

CPA

X =For every 100 clicks, the ad gets 4 conversions.

CVR = 4%

CVR

This is London Fog’s profit from the sale.

If you pay more than this per click, you’re

losing money

Break-even CPC makes you smarter with your dollars

@jmgagnon

CPA Conversion

Rate

Break-even

CPC

$25 4% $1.00

$25 4.5% $1.12

$25 5% $1.25

Increase conversion rate or CPA (aka margin)

How do we increase our break-even CPC?

x

x

x

=

=

=

@jmgagnon

Landing page testing

How do we increase our conversion rate?

@jmgagnon


Search Funnel

@jmgagnon

26

Search Page

Search

1 2Search Box Convert4Landing Page3

From landing

page makes

purchase

From search

page clicks

on ad

From search

box ad shows

on search page

called called called

Click ConversionImpression

Searcher’s Flow

@jmgagnon

Search Page

Search


Clicks

Clicks

Conversions

Impressions

How many clicks you get per 100

impressions. Helps indicate the

effectiveness of your ad copy

How many conversions you get per

100 clicks. Helps indicate the

effectiveness of your landing page

=Click thru Rate =Conversion Rate

Impression ConversionClick

Searcher’s Flow

@jmgagnon

28

Search Page

Search


Step #1 matters. What are they looking for?

@jmgagnon

Initial Research:

“Advertise My Business”

Specific Field:

“Online Marketing Tips”

Add More Refinement:

“Search Marketing”

Specific Brand:

“Advertise on Bing”

How do you search?

@jmgagnon

Initial Research:

“Advertise My Business”

Specific Field:

“Online Marketing Tips”

Add More Detail:


Specific Brand:


Funnel: Not all keywords alike

Purchase

Interest

@jmgagnon

Initial Research:

“advertise business”

Specific Brand:


Advertise

Market

Paid Search

Sponsored

Search Marketing

SEM

Bing

Yahoo

Specific Field Name:


Add More Refinement:

“Online Marketing

Tips”

Online

Internet

Pay per click

PPC

adCenter

Account Outline

@jmgagnon

3 Minute Drill

• Write down the most important services/products that make sense for

you to sell online.

• What are some differences between you& your competitors? Awards? Family Business?

• Seasonal Offers or Promotions?

• What are your goals for online? How much is a lead/sale worth?

• When are your peak times?

32

Keywords

Bid

Ad Copy

@jmgagnon

2 Key Building Blocks

• Keywords. What are your customers searching?

• Ad Copy. In a few characters, tell your customers why they should buy from you and not your competitors.

33

Seattle Florist

Seattle Florists

Flowers in Seattle

Red Roses

Wedding Florist

Flower Delivery

Floral Arrangements

Seattle Florist

Same day Seattle flower delivery.

Courteous Reliable Family Florist.

www.meritflorist.com

A wizard will help you walkthrough how to set these up. There are tools

for generating keywords. And you may wish to look for ideas from your

competitors for ads.

@jmgagnon

Think of Ad Group like a Product, Service or Brand

• Example: Seattle Florist, Red Roses, Wedding Florist, Flower Delivery, Nursery/Seed, Floral Arrangements, Cookie Platters

Good Rule of Thumb• 10-30 keywords per ad group

• 2-4 Ads per ad group

• Match your ad to what people are searching for

34

Keyword Ad Copy

Keyword

Keyword

Keyword

Ad Copy

Ad Group

Wedding

Florist

Quick

Quote

Seattle

Wedding Florist

Wedding

Flowers

Wedding

Bouquet

Seattle

Bride

Product:

Weddings

AD:

AD:

KW:

KW:

KW:

KW:

Build a Solid Foundation

@jmgagnon


Effective Ads

@jmgagnon

36

Seattle Florist

Same day local flower delivery.

Courteous Reliable Family Florist.

www.meritflorist.comTest which messages

your customers

respond to most.

A.

Seattle Family Florist

Same Day Seattle Delivery. A Reliable

Family Florist For Mom

www.MeritFlorist.com

B.

7 Clicks/ 100 Impressions

11 Clicks/ 100 Impressions

Test and Repeat

@jmgagnon

How do we break down an online program to drive sales?

Visit: www.BoostCTR.com

@jmgagnon

http://www.boostctr.com/

How do we break down an online program to drive sales?

AD COPY TESTING FRAMEWORK

@jmgagnon


The framework for ad copy testing

®

Probability of conversion

Clarity of the value proposition

(why)

Friction ofelements of

process

Motivation of the user (when)

Incentive to take action

Anxiety about entering

information

C = 4m + 3v + 2( i-f) -2a

@jmgagnon

The framework in action

FOCUS

VALUE PROP

ANXIETY

FRICTION

INCENTIVE

MESSAGING

High Quality, Durable, Best Selling

Low Price Guarantee, Starting at $10, Bargain, Wholesale Pricing

Over 5,000 items, Huge Selection

Since 1984, As Seen on TV, NY Times

No Booking Fees, One-time, No Minimum

Ends by Date, Limited Time

Missing Out, Don’t, Why

Ships Within 1 Day, Inventory Available

Free returns, 30 day returns, no hassle

Within Minutes, Quick & Easy, 3 Steps

Up to 50% off, Save Extra 25%

Free Whitepaper, Buy One Get One

Free Shipping, Free Overnight

TACTICS

Quality

Low Price

Selection

Credibility

No Hidden Fees

Time Limit

Highlight Loss vs. Gain

Quick Turnaround

Return Policy

Ease of Use

Discount

Freebie

Free Shipping

@jmgagnon


What we’ve covered

Ad CopySearch FunnelValue a Click

@jmgagnon