Top 5 Worst Practices in Paid Search

There is a saying in advertising: “Clients change agencies like they change {keyword: socks or underwear}.”

The reality is a little less volatile, given that familiarity and relationships often prevail in business, usually for the right reasons.

A better analogy – when things are going absolutely awry – is tectonic plates crunching together, or ice caps melting in the North: disaster may not happen today or tomorrow, but there is a certain inevitability to the outcome. When service levels and performance levels remain low for an extended period of time, eventually clients shop around and make the switch.

If you study the switching activity, there’s a remarkable consistency to clients’ fundamental beefs with their existing agencies. I’ll review five big ones here.

No one’s perfect, so this isn’t about nitpicking. I happen to think that service providers generally over-deliver in many subtle ways in this impersonal world. The best act like linchpins – becoming part of the family, and waking up in the night thinking about account performance and strategies. Long-term relationships have important roles to play in business performance.

From direct observation as well as anecdotal evidence, here are five acutely unacceptable practices; reasons clients often give for switching from their “worst-practices” PPC service provider.

  1. The client doesn’t get to own their own account. This one is actually often more of a symptom of a low-service level rather than a direct cause of contention. When clients get a nagging feeling they could be doing better, and want to have a look inside their accounts, that’s when the trouble starts. They’re not allowed in. Turns out they aren’t going to get access to their account, ever. The agency now owns much of the client’s critical business data.I can understand why some agencies have cooked up this model. It prevents clients from free riding; if they want to take the campaign in-house prematurely, for example, they’ll have to go it alone, without the campaigns built and tested by the agency. But the problem with this model is that it lowers the overall level of trust, collaboration, and ultimately, account performance.The best antidote to this is simply a contract that includes a clause stating the account data is the client’s intellectual property. And, of course, the client – not the agency – owns the root account credentials.

    Regardless of who owns what, business relationships typically won’t work unless there’s a climate of mutual trust.

  2. Extreme incompetence (display network). When I read “The Black Swan” by Nassim Taleb, I was convinced that rare and cataclysmic “black swan events” were more the purview of the financial markets – especially bets on complex derivatives – than anything that could happen inside an advertising auction. Unfortunately, some campaign managers find a way to create them in spite of the many safety mechanisms and optimization methods available to them. What’s the point of detailed optimization, frequent meetings, and meticulously prepared reports if something like 25 percent of the spend gets chewed up on boneheaded experiments or simple lack of knowledge of how these complex systems work?The display networks (such as the Automatic Placements you can run in Google AdWords campaigns) are increasingly impressive in terms of potential performance. But they won’t discern for you if the list of matching publishers is creating inappropriate leads for your software download, from countries and demographics that are more into gaming and hacks than corporate security solutions. There are so many ins and outs to the network these days, that it takes experience to address it properly. A classic mistake is to bid low because it’s “safer.” Low bids typically match you up with low-quality publishers who, amazingly, manage to deliver tons of useless traffic.
  3. Extreme incompetence (keyword intent). Many agencies come from a “media buy” background and are more than willing to try boneheaded keyword experiments just to address a big swath of imaginary potential customers. Whoops, in many cases the keyword is very specific to something entirely different the user wants, such as something related to an enormously popular competitor’s brand name (something our client spotted its sister company doing last week through a clueless campaign manager, wasting $20,000 on a “fun experiment” in two days). Whoops, your landing page is so irrelevant it literally offends people. The bounce rate is through the roof. Quality scores plummet. The wasted funds on a single keyword could have paid for several months’ worth of good service from a top-drawer manager.
  4. Outsourcing to Google. Google provides great resources. By consulting Google as one professional to another, an advertiser, agency, or manager can walk away with potential insights and support to apply to the overall effort. Don’t just take Google’s word for it, though. Shouldn’t this be obvious? Try this: enable the column for effective CPM in the AdWords reporting. Then try to imagine how Google feels about that number. Does Google cringe when you figure out how to get it lower, for the same quality of traffic? Is Google high-fiving when it’s sky-high; too high? You should always be aiming for KPIs that are either directly or indirectly related to ROI. Googlers may talk about your ROI to be polite, but it doesn’t really affect them or Google. What affects them is average CPMs on Google Search across all keywords, across all countries, across all users. By and large, Google isn’t going to be upset if you take its half-baked optimization suggestions and wind up overpaying for clicks. Sure, Google wants you to be happy, but as a strong second option, it’ll take “blissfully ignorant.” A PPC practitioner that is too deferential to Google – especially where it comes to deciding what traffic you buy, and how – is a practitioner you should fire.
  5. Just a white label, not a dedicated marketing agency. Trusted brands in industries like web hosting naturally have call centers, recurring billing systems, and people who can sound vaguely technical enough that they’re on top of your account. They can facelessly send you a pretty-looking automated report. But they probably commit one or more of the above worst practices, particularly No. 1. If you don’t get to work with an identifiable professional who works at an actual marketing agency that specializes in SEM, then all you’re left with is a call center, a recurring bill, a few buzzwords, and a report that you can’t put much faith in. And don’t be fooled if the company is “AdWords Certified” or any other type of certified. While they may be indicative of some level of commitment and a modicum of skill, these certifications amount to little more than studying for and writing relatively easy exams. They say little about the track record for real-world optimization, strategy, and commitment to long-term client service.



Paid Search, Mobile Spending Increase in Q1 2012


The U.S. paid search market grew 16 percent YoY in Q1 2012, according to the Adobe Systems Global Digital Advertising Q1 2012 Update. For the same period, IgnitionOne puts total U.S. search spend growth at 30.3 percent in their Global Online Advertising Report. Either way, it’s great news for search marketers, especially those participating in the mobile search space.

Paid Search Spend YoY IgnitionOne

Marketers Spending More on Mobile

Adobe’s report has U.S. marketers increasing their mobile ad spend to 8 percent of all search spend, while those in the U.K. allotted 11 percent to mobile in Q1. Tablets alone accounted for 4.25 percent. Adobe predicts mobile and tablet advertising will continue to appeal to advertisers in the short term, given their “disproportionately” low CPCs, compared to desktop PCs.

IgnitionOne put the amount of U.S. paid search spend dedicated to mobile slightly higher, at 12.4 percent. This represents an overall increase in mobile search spend of 221.1 percent over the same quarter last year, though the report warns that this growth rate has slowed since Q4 2011. Clicks on mobile ads increased 246.1 percent YoY.

Yahoo/Bing Increase Market Share, But Kill Their ROI Advantage Over Google

According to IgnitionOne, Yahoo/Bing had their best quarter since Q2 2010, with a 46.4 percent increase in U.S. search advertising spend YoY. For their part, Google saw lower but no less impressive 26.6 percent growth YoY. Compared to Q4 2011 (the holiday season), Bing actually saw total ad spend increase 14.3 percent, while Google’s spend fell 5.4 percent.

Adobe notes that Google’s CPC fell 5 percent over last year, while Yahoo/Bing CPC rates were 18 percent higher YoY.

“As a result, the Bing/Yahoo ROI advantage over Google no longer exists,” says the report. “Note that when Yahoo Japan converted to the Google ad serving platform from Bing/Yahoo, CPC rates dropped significantly. This indicates that Google, on average, charges a lower premium to search advertisers.”

Outlook for Rest of 2012

Marketers are missing out if they’re not targeting mobile, said Roger Barnette, President of IgnitionOne.

“While the growth in mobile ad spend has been an ongoing trend, I am impressed by the level of activity and click-throughs on tablets. This should be a wakeup call for marketers who are not yet leveraging search advertising on these devices,” Barnette said in a statement.

Meanwhile, Adobe predicts U.S. search spend will increase 10 to 15 percent throughout 2012, with tablets and mobile taking up to 20 percent of all search spend by Q4 2012. Marin Software also recently predicted that smart mobile devices will account for a full 25 percent of paid search clicks on Google by the end of 2012.

Adobe also offers a bit of advice to marketers in their report: “In a rational marketplace, the CPC rates on tablets should be identical to desktop CPC rates if the conversion rates are comparable. Furthermore, current trends indicate that tablets may cannibalize smartphone and desktop search spend as investments continue to shift to tablet devices.”