#12DaysofStrategy: Effective Messaging Timelines in the Run Up to Christmas

Now that the Black Friday week is over ad copy messaging is more relevant than ever, with the run up to Christmas being a key trading period for most retailers.

Ensuring messaging runs across all digital channels, such as Display and Paid Social, as well as offline such as print and storefronts, is crucial. It delivers a consistent message to consumers and reinforces brand recognition, especially when tied with a strong Christmas tagline.

Updating messaging as we move closer to Christmas helps to capture consumers at different stages of the buying cycle, from those still browsing in early December to the last-minute shoppers purchasing a few days before the holidays.

Early December

To show ads are current and relevant to the consumers shopping needs, include seasonal words in ad copy, such as Christmas or Boxing Day.

Bing’s 2015 Christmas analysis showed that including endorsements such as ‘As Seen on TV’ and ‘Recommended’ can have a strong impact. In addition, consider including payment options such as ‘Buy Now Pay Later’ or ‘Free Credit,’ if these options are available for big ticket items.

Alter messaging according to the keyword group or theme. For more generic gift keywords the call-to-action should be more focused on browsing the range of products available, as consumers searching using these terms may not have decided what they would like to buy. Emotional based ad copy is effective here and should be tailored towards the recipient.

Example: ‘Find The Perfect Gift For Mum This Christmas.’

Manufacturer or product keywords require a stronger call to action such as ‘Buy Now’ or ‘Buy Today.’ Those consumers search for a specific product are more likely to have done their planning and now know what they would like to buy.

Bid multipliers now allow advertisers to split campaigns out by device. This makes it possible to tailor messaging for those exclusively searching on mobile. For consumers on the move use messaging to encourage store visits such as ‘Come Into Your Nearest Store Today.’ Additionally, including the price of products in headlines (if price-competitive) will allow consumers to make easy price comparisons and ultimately decisions.

The Week Before Christmas

In the final week before Christmas, use ad copy to highlight the urgency of making a purchase. This will capture those last-minute shoppers.

Messaging should include the last guaranteed delivery dates, and considering creating a countdown script to automate the process. After the last delivery dates have passed, alter the messaging to ‘Click & Collect’ if this option is available and the date is later than for last delivery.

Use device-specific campaigns to target mobile consumers with messages such as, ‘Still Available in Store,’ after delivery dates have closed. This will help to drive those final sales.

If you found these tips useful check out our first post What to do After Black Friday or check in on Monday for our third post in our ‘12 Days of Christmas Strategy’ blog series, “How to Maximise Audience Use.” We will be covering more topics over the series so stay tuned, and follow our progress on Twitter with #12DayofStrat!

Using Data more Effectively with Facebook Custom Audiences

As advertisers strive to reach the audiences, and re-engage former users, Facebook has simplified this process. Using Facebook Custom Audiences, advertisers can reach old and new users in one fell swoop.

What are Custom Audiences?
Armed with a list of email addresses or phone numbers (CRM data), advertisers can upload the information as a CSV or TXT file into Facebook’s advertising platform, create a custom audience and target those individuals with relevant ads across Facebook. Information can also be captured from a website or mobile app using Facebook tags. Data collected on user site activity can then be segmented into different groups, such as users visiting specific products but failing to purchase.

Tapping into New Audiences
Instead of bombarding random users with irrelevant ads, Facebook offers a smart alternative to growing potential customer base through lookalike audiences. Lookalike audiences use custom audience data to reach out to similar users that are relevant to your business on Facebook.

Lookalike audiences can be based off the data collected from people who: like your page, have visited your website, are part of the demographic you care about, or live in/are visiting your desired location. Advertisers can also focus on milestone/life events such as weddings, new homes, or a new baby, or even target specific preferences, such as dog lovers, fitness buffs, and coffee aficionados.

Re-engaging with Former Customers
Consumers are far more likely to buy from a brand they have previously purchased from, making Custom Audiences an efficient means of making your advertising budget go further. You only spend money on people you know are more likely to convert, rather than casting a wide net and wasting ad spend on people who aren’t your target demographic, or interested in your products or services.

Benefits of Facebook Custom Audiences

  • Reach Relevant New Users – for those trying to expand their customer base, lookalike audiences, are an incredibly powerful tool. Target new people who have a similar user profile to your current customers, indicating a higher propensity to purchase the products or services your business offers.
  • Increase page likes – get more people to notice your brand.
  • Selling/Upgrading a product – capture users who have purchased an item or service and market accessories or extras that they may find useful.
  • Reach users who don’t open your emails – many people automatically delete product emails or send them to a junk folder never to be seen again. By using Facebook’s Custom Audiences, you can capture this user when they are on Facebook by putting the product or service from your email in front of them in their news feed.
  • Remind your audience of a call-to-action – remind users to continue with an action they may have forgotten about in their email.
  • Turn free trial/“freemium” users into subscribers – show freemium users the extras available to them in their Facebook newsfeed – let them know the features they’re missing out available via subscription.
  • Promote contests – have a contest in the wings? Capture interest with customer who you want interacting with your event through Custom Audience targeting.
  • Encourage customer feedback when launching new products or services – ask your custom audience to respond to the survey on your latest product by offering an incentive like a “freebie”, or discount on their next purchase as a thank you for participating.
  • Enhance email marketing efforts – catch people in their inboxes, and on social media, doubling you chances for interaction.

Points to Remember

  • For website and mobile created custom audiences, users are only kept in the group for a maximum of 180 days, unless they revisit the site or use the mobile app again.
  • Lookalike audiences can only use people located in one country at a time.

Want More? Read our two white papers on how to use Facebook more effectively and Turning Big Data into Smart Data.

How to Test the Value of Brand Keywords in Adwords

A recent study by Bing analysed click results for Retail and Travel brands comparing those brands that bid on brand keywords and those that do not. The study found that there is a 31% increase in clicks when bidding on brand keywords. Furthermore, without having a brand ads competitor ads receive 34% of clicks.

 

However, for some companies bidding on brand keywords may not be an efficient or effective use of their budget, so how can they test if bidding on brand keywords is right for them? At Net Media Planet (NMP), we have developed a process to help determine the true value of bidding on brand keywords. This simple process can be done by any advertiser, and can ultimately help them to be more profitable.

 

The Process:

 

The first step in testing the value of brand keywords is to create a new campaign in AdWords that bids on exact match brand keywords. The campaign will alternate between running and pausing the keywords every other day. For instance, Monday keywords will be enabled, Tuesday they will be paused, Wednesday enabled, and so on for around four weeks to get an accurate analysis from the data. Alternating day’s removes possible skews in the data caused by day of the week or time of the month trends.

 

There are two ways to manage the pausing of the campaign: manually or automated. Manually takes a significant amount of effort compared with automated processes, and there is a higher room for error especially on weekends if the campaign is no being monitored. We highly recommend automating the process in either AdWords or DoubleClick, depending on where the campaign is managed.

 

To set up campaign automation in AdWords select the exact match brand keywords and click on the “Automate” drop down then select “Pause keywords when…” Under Frequency choose “One time” the date and the time a seen below:

 

Pausing Campaign Keywords in Adwords

 

Similarly to reactivate/enable the keywords go to “Automate” dropdown and select “enable keywords when…” and select the next day, as seen below:

 

Enable Paused Keywords in Adwords Automatically

 

These automation rules will need to be created for each day of the month, so repeat this process until the entire month is automated.

 

Tracking:

 

In order to track results, the website will need an analytics platform such as Google Analytics which allows ecommerce tracking specifically the revenue performance of organic and paid search channels.

 

For instructions on how to implement Ecommerce Tracking visit Google Analytics Support Page.

 

Determining value:

 

In order to determine the true value of brand keywords, you will need to look at the combined organic revenue and paid search revenue for each day of the campaign.

 

1. Each day add together the organic and paid revenue values.

 

Date Brand Term Bidding? Organic Revenue PPC Revenue Total
1/7/15 Yes £45 £100 £145
2/7/15 No £40 £80 £120
3/7/15 Yes £70 £110 £180
4/7/15 No £50 £95 £145

 

2. Then at the end of the campaign add together all the results for days where brand keywords were enabled and days when the campaign was paused.

 

Brand Term Bidding? Organic Revenue PPC Revenue Total
Yes £115 £210 £325
No £90 £175 £265

 

3. Quite quickly you will be able to determine the effectiveness of the campaign, but remember to subtract the cost of ad spend for the days you were running the campaign. That way you can determine if the extra cost was worth the increase in performance.

 

Brand Term Bidding? Organic Revenue PPC Revenue Ad Spend Cost Total
Yes £115 £210 £20 £305
No £90 £175 £10 £255

 

This process can also be used to evaluate website sessions if it is an important KPI metric for the campaign. Instead of looking at paid and organic revenue you will add paid and organic sessions together. This may be relevant for businesses that do not have an ecommerce platform on their website.

 

Who Should Always be Bidding on Brand:

 

For brands who sell their products through resellers, this can increase competition on brand keywords. We recommend always bidding on brand keywords in this circumstance to decrease the amount of lost business. As mentioned earlier in this article competitor ads will accrue 34% of clicks if you are not bidding on brand keywords.

 

How Effective Are Brand Keywords?

Source: Bing ads internal data, Dec. 2014

 

In some situations it can be incredibly difficult to match the budgets of some of the bigger resellers. If this is the case using RSLA’s will allow advertisers to use their budget more effectively by only bidding on consumers who have shown an interest in their products.

 

6 Ways to Make the Most Out of Your Click-To-Call Campaigns


 
With the advent of Google AdWords’ Enhanced Campaigns and unified device targeting, managing the bids of a pure click-to-call campaign can be a tricky balancing act. Here are 6 top tips, tricks and things to remember when optimising your click-to-call campaign:
 

1. Setting up your campaigns

Click-to-call campaigns are set up in Adwords, as like any other paid search campaigns. However, advertisers must add a call extension to their ads, which is found within the ‘Ad Extensions’ tab.
 
Within each campaign, advertisers are able to add in a phone number. Remember: show phone numbers appropriate for the country you are targeting, otherwise they may get angry customers complaining about expensive international call charges!
 

 
Google forwarding number – by using the call forwarding number, advertisers can utilise call reporting features in AdWords, such as phone call conversions, phone impressions, number of phone calls, PTR (phone-through-rate), and Avg. CPP (average cost per phone). Advertisers can see which keywords are driving phone conversions. However, the downside is that by opting into call reporting, Google replaces the company phone number with their own generated number. As a result, this new Google number appears on the user’s mobile keypad as a “0333” number. This may be off-putting to some users who are concerned about call charges.
 
Show the following links – if advertisers want to drive ¬only mobile calls, the “show the following links” option in Adwords allows you to select “Just the phone number”. By choosing this, a click on your ad will mean the user gets directed to make a phone call rather than to the homepage of your site. The headline then moves down below the display URL, and the phone number appears as your new ad headline clickable straight to the number.
 
If advertisers choose to combine these two options, be aware that the company call number appears as the headline of the Paid Search ad but when the user clicks on it, a different Google forwarding number will appear in their keypad, as represented below. This may cause consumers to not proceed with the call.
 

 

2. You pay per click, not per call

When your ad appears on a mobile device and the user clicks the ‘Call’ button, the call number appears on the user’s keypad where they can then choose to follow through with making the call. Google will charge you a CPC based on that first click and not on whether the user then follows through to make a call. Advertisers may find that there is a large discrepancy between the click through rate and the call through rate and should plane their budget according to a drop off ratio.
 

3. Mobile ads

Advertisers can increase their call through rate if the mobile ad uses messaging to emphasise and encourage the user to call. Ad Text such as “Speak To A Specialist Today!” or “Call Now For Our Best Prices!” can serve to reinforce that by clicking on this ad a consumer is expecting to make a call. This reduces money spent on wasted clicks.
 

4. Search Partners

In your normal paid search campaigns, it is often best practice to include all search partners in your campaign settings to maximise coverage. However, with a click-to-call campaign, choose to disable this feature and select the ‘Standard’ option. While all search partners will be able to show your mobile ad, many do not have the call button feature. This increases clicks and ultimately cost while reducing the call through rate.
 

 

5. Ad scheduling

Remember your call centre opening hours! Within the ‘Settings’ tab at campaign level, you are able to set your ads to schedule at certain hours of the day and days of the week. Make sure that your ads only run while your call line is open otherwise you will be paying for clicks and receiving no calls.
 

 
Furthermore, you will be able to employ the ‘Dimensions’ tab to find out when you are receiving the highest number of impressions and tailor your bid strategy to be more aggressive at those times. For instance, if a travel advertiser knew that users liked to research flights during their morning work commute and then call through during their lunch hours, bids can be customised accordingly.
 

6. Have a mobile ready site

 
Last but certainly not least, make sure your website is mobile optimised. This seems like a simple point but can often be overlooked and forgotten! Click-to-Call is an effective mobile advertising function and whenever advertising on a mobile device advertisers will have consumers viewing their website, especially if show “both my website and phone number” are selected during the setup (see the first point). If the website isn’t mobile optimised then consumers are more likely to leave the site without calling or converting, wasting valuable ad budget. Google have a new handy tool that allows advertisers to see if your website is mobile-friendly: google.com/webmasters/tools/mobile-friendly
 
 
Click-To-Call advertising can be an incredibly effective campaign, especially when your ultimate goal is to get a consumer on the phone, but this campaign strategy is fairly new. By using the above tips and tricks advertisers can increase the effectiveness of their campaigns.


Christmas: Sparkle vs Savings

Over the last couple of years we have seen a change in consumer behaviour during the Christmas period.

 

Across many of our retail clients, we have traditionally seen offer based ad copies that promote sales or savings perform well throughout the year. This rather predictable trend was however not always carried through to Christmas. Seasonal messaging that focused on ‘finding the perfect present’ or ‘sparkling this Christmas’ often outperformed offer based ad copies; in one instance by 43%.

 

Christmas Past

Last Christmas we started to see this seasonal messaging trend shift for some of our retail clients. ‘Christmas savings’ messaging generated higher CTRs and conversion rates than the seasonal based messaging. This echoes the trend that Google called out this year in their Christmas webinar. This highlighted the significant growth in search volume for the terms ‘Christmas offers’ and ‘Christmas deals’ in the last 2 years as shown below;

 

Trend of keywords related to Christmas savings

 

 

Christmas Present

Now, as we enter the most important 6 weeks of the retail calendar, we have started to see this consumer reliance towards offers and deals develop one step further. Owing to a declining conversion rate YoY on a client’s homepage in the first month of Q4, we utilised our learnings from our ad copy tests and conducted a landing page split test. We wanted to test the hypothesis that directing traffic from their brand terms to an offers page, which emphasised the best promotions, would result in a positive uplift in conversion rate. This approach diverted visitors away from the traditionally high converting homepage.

 

This resulted in a 28% increase in conversion rate for the brand term and has since been rolled out to other non-product specific keywords.

 

Christmas Future

It is always a risk for clients to cater for bargain hunters owing to the detrimental impact on AOV and potentially the brand reputation. However, with consumers now having easy access to competitor prices and with sales and voucher codes becoming an increasingly regular occurrence online, sales are no longer only a way to clear surplus stock. They are instead becoming a response to how customers are searching and purchasing online.

 

In response to this emerging trend, we are adopting three new strategies in the approach to Christmas to take advantage of the changing consumer mind-set:

 

1. Landing page split tests – We no longer assume that the homepage continues to be the highest converting landing page for brand terms.

2. Expanding ‘savings’ related keyword coverage – This enables advertisers to maintain share of voice and capitalize on this ever-increasing traffic.

3. Test value added offers – Promote differentiating features such as ‘elf-styled gift wrapping’ or ‘free express delivery’ to stand out in the SERPs.

 

In conclusion, with consumer search patterns changing each Christmas, our paid search strategy has to continue to develop through messaging tests, landing page optimisation and coverage of trending keywords. However, with consumers’ ability to compare prices so quickly online, brands and advertisers must concentrate on their differentiating features in the lead up to Christmas.

 

Moving away from the monetary savings and towards the sparkle of a hassle free Christmas may be the message for Christmases to come.

Google Ad Rank Calculation Update

This week Google announced a major change to its Ad Rank calculation which is used in determining the position and CPCs paid by each advertiser in the Google ad auction.

 

Historically Ad rank has been calculated by multiplying your Max CPC bid by your Quality Score (Google’s assessment of the relevance of your keywords, ad copies and landing pages). But with this new update Google now also factors in the expected uplift from the ad extensions and extension formats that you are using in your AdWords Campaigns. In addition Google has increased the importance of Ad Rank in determining whether your ad extensions are eligible to be displayed along with your ad. Here are the full details of the update from Google:

 

  • Ad extensions and formats can now influence the position of your ad on the search results page. If two competing ads have the same bid and quality, then the ad with the more positive expected impact from extensions will generally appear in a higher position than the other.
  • When estimating the expected impact of extensions and ad formats, we consider such factors as the relevance, clickthrough rates, and the prominence of the extensions or formats on the search results page.
  • Because Ad Rank is now more important in determining whether your ad is shown with extensions and formats, you might need to increase your Quality Score, bid, or both for extensions and formats to appear.
  • In each auction, we’ll generally show your highest performing and most useful combination of extensions and formats among those eligible. So there’s no need to try to guess which extensions will help improve your clickthrough rate the most.
  • You may see lower or higher average CPCs in your account. You may see lower CPCs if your extensions and formats are highly relevant, and we expect a large positive performance impact relative to other competitors in the auction. In other cases, you may see higher CPCs because of an improvement in ad position or increased competition from other ads with a high expected impact from formats.
  • For now, this update only affects search ads appearing on Google Search.

 

Why has Google made this change?

It has been widely known that Ad extensions typically improve CTR which means more ad clicks and more revenue for Google. By making ad extensions a key component in the Ad rank calculation this will likely further encourage advertisers to take advantage of more of these Google features within AdWords.

 

Also as ad extensions generally only appear for ads in the top 3 positions in the SERPs it is likely that advertisers will compete more aggressively for these top positions in order to see the additional benefits that ad extensions bring to Ad rank which would ultimately mean increasing overall market CPCs.

 

What does this change mean for advertisers?

The Use of ad extensions will now be more important than ever. To ensure advertisers are getting the best position and lowest CPCs for their max bid they will have to ensure they are using the most relevant combination of ad extensions for each keyword, location, device and time of day. With ad rank now being dependant on the actual performance of these extensions, not just whether they exist, this gives advertisers another element to optimise in addition to ad copies, keywords and max bids which will give an advantage to performance orientated paid search agencies.

 

The changes will likely have a bigger impact for clients with a high reliance on mobile activity as ad extensions on mobile devices (location extensions, call extensions as well as sitelinks) provide a method of getting mobile users the content or information they want fast. Advertisers not utilising these features will likely see a drop in average position and/or increase in CPCs as a result of the Ad Rank update.

 

The changes will also mean that some businesses will need to make changes to their web design in order to avoid being penalised by this update.

 

E.g. Small businesses that have a website with only one or two landing pages will not be able to fully use sitelinks extensions unless they create more landing pages (Google policy states each sitelink must go to a different landing page)

 

Top Tips/ Recommendations

  • Ensure that you are eligible to use as many types of Google’s ad extension formats that are relevant for your business as possible. E.g. Sitelinks – Requires 1 unique landing page per sitelink
  • Location extensions – Include location information next to your ads via a  Google places account or by enter addresses manually in AdWords
  • Social Extensions – Does your business have a Google+ page linked to their website?
  • Call Extensions – Do you have a phone number that customers can call your business on?
  • Offer Extensions – Can you provide an exclusive offer that can be redeemed online or in store?
  • Review Extensions – Show accolades from reputable third parties below your ads
  • Analyse the historical performance of the extensions formats you are currently running to identify which formats perform the best by keyword category, device, location, time of day etc. Ensure coverage of your best performing extensions is maximised and increase relevancy where possible – E.g. Improve sitelink relevance by using ad group level sitelinks and use sitelink description lines, ensure offers and promotions are kept up to date
  • Look at which of the other available extension formats can be displayed in the SERPS in addition to your current best performing extensions and add these into your campaigns. For example call extensions, location extensions, social extensions and review extensions can all be displayed in addition to sitelinks in the SERPS so will likely have a positive impact on your Ad Rank. Google states that the ad platform will generally show your highest performing and most useful combination of extensions and formats among those eligible. So one option is to upload all extension types available and let Google pick the best ones. However how effective Google will be at picking the best extensions is yet to be seen
  •  Use device preference and scheduling on extensions to further increase relevance. E.g. scheduling call extensions for call centre opening hours, schedule offers between the start and end date
  • Look at what ad extensions and formats your competitors are using and how you can improve upon and differentiate your ad extensions to give you the advantage
  • Monitor changes in ad position and average CPC as a result of implementing different extension formats to see which are the most beneficial to Ad Rank for your activity
  • Monitor changes in ad position and average CPC as a result of implementing different extension formats to see which are the most beneficial to Ad Rank for your activity
  • Expect this to rollout across Display in the near future so start testing ad extensions and formats in Display now

 

This is clearly an important change from Google Adwords and brands should certainly take note.  Please get in touch if we can help .

Jump start your Christmas marketing by planning ahead

 

Christmas is the most important time of year for retailers. Indeed, Google reports that Christmas-related searches have already this year seen a YoY increase. With a more positive economic outlook retailers can seemingly prepare themselves for a bumper Christmas 2013 period.

 

We recently attended a Google event to learn more about what brands can expect for Christmas 2013. Here we share some of those insights and offer some tips to help retailers make the most of the upcoming season.

 

Expected trends for Christmas 2013:

1. Mobile is going to be huge – you won’t see growth on desktop. Last year mobile penetration was at 58%, it is expected to be at over 72% this Christmas. This trend will continue to grow as consumers use their mobiles to search for and purchase products in the months ahead of Christmas. Google has a number of effective mobile specific features for brands to engage with consumers including; location extensions, click-to-call buttons, and mobile coupons.

 

2. International opportunities will increase. By 2020, it is anticipated that £28BN of UK e-tailer sales will come from abroad. If you are interested in expanding internationally, Christmas offers a perfect opportunity as more consumers are looking for different types of gifts. Google has tools available to help you understand where there is search interest for your brand or products, such as countries with large expat communities.

 

3. Shopping behaviour will change. Consumers will buy more online this year than ever before. As a result, Google Shopping will play a significant role as Christmas time draws nearer. According to Google, 25% of search traffic will come from PLAs this Christmas. So if you have not done so already, set up Product Listing Ads (PLAs) to promote your products to consumers in Google’s Search and Shopping results. The screenshot below show example PLAs on the search engine results page for the term ‘red tents’.

 

 

4. Increasing personalisation of consumer experience. Consumers are increasingly responding to higher relevance in advertising. Use tools such as Remarketing Lists for Search Ads [RLSA] and Demographic Targeting to help ensure you serve the most relevant messages to consumers. This will also enable you to be more effective at each stage of the consumer journey.

 

5. Online video is booming. In the UK, the average person consumes around 18 hours of online video content a month. Video is not only a source of entertainment, it is increasingly present in the buying decision process. As 4G finally arrives, it brings with it more opportunities for brands to better engage with their consumers through online video as they shop on the high-street.

 

By being prepared early brands can take advantage of these five trends in consumer online search and buying behaviour. We would recommend that you prepare now by putting together a solid Christmas marketing strategy to help stand out from the crowd.

 

3 key takeaways:

• Embrace new formats and devices to help provide the seamless experience for consumers.

• Remember that Christmas is global and use this time to scope out new opportunities in other countries.

• Go that extra mile by making your messages more relevant and engaging to your audience.

 

The stats referenced in this article are taken directly from Google’s presentation at the event. For further information and insight on the stats presented in this article please email [email protected]

 

 

 

Improving your performance with the Google Bid Simulator

bid simulator article image

Thinking about increasing or decreasing your bids, but uneasy about how it might affect your ad performance? It doesn’t quite predict the future, but the Google Bid Simulator will certainly help you understand how different bids could affect your traffic.

 

So, what is Google Bid Simulator?

 

The Google Bid Simulator allows the user to explore different scenarios of impressions, clicks and CPCs at a keyword level for different max bids. This is based on the last 7 days of history.

 

The Google Bid Simulator works by analysing data from ad auctions on Google for each keyword including factors such as Quality score, competitor bids and traffic volumes to provide up to 7 different Max CPC Bid scenarios, as per the graphic below.

 

 

bis simulator table 1

 

To see data from the bid simulator, go to the ‘Keywords’ tab in your AdWords account. Then, click on the bid simulator icon in the Max. CPC column next to the bid of any keyword you would like to see data for.

 

How you can use this data to maximize Performance?

 

If we take each of the data points provided by the Google Bid Simulator – Max CPC, Impressions, Clicks and Cost, we can then use conversion rate and AOV data from the same keywords to calculate which Max CPC would have resulted in the highest Gross Profit (or any other performance KPI such as ROI) over that period.

 

For example if the keyword above had an AOV of £75, a CR of 1% and our Gross profit is calculated at a 50% margin e.g. (Revenue*50%)-Cost, then we would find that a max Bid of £0.17 would give us the optimum Gross Profit. See figure 1 below and the row in grey:

bid simulator table

Figure 1.

 

However if the AOV and CR were both double, the optimum max bid would be different, in this case £0.68. See figure 2 below and the row in grey:

 

bid simulator table

Figure 2.

 

Using Bid Simulator data at scale

 

By pulling the Google Bid Simulator data into our Mercury technology platform via the Google API, we can automate analysis of this data for all keywords where bid simulator data is available. We then set new max bids to ensure we have the optimum max bid/position combination per keyword.

 

However there are several considerations to take into account:

  • The Bid Simulator data that Google provides is only for high traffic keywords. The majority of keywords will have no Bid Simulator data. Bid Simulator also doesn’t work with campaigns that use Advanced ad scheduling or Google conversion Optimizer
  • Bid Simulator data is based on historical performance and does not guarantee what will happen in the future. Any weekly changes in conversion rates and AOV will change the optimum max bid/average position combination. However this methodology does ensure that bid changes are reactive to the most recent changes in these performance metrics for high volume keywords
  • Click path and conversion lag factors need to be taken into account. If we were to look at sales/conversion rate only on a last click basis, we would be potentially making bid changes based on incomplete data

 

In Figure 1. the data is based on looking at the last 7 days and so there will be a % of sales that have not yet been reported due to the conversion lag. This will vary depending on the advertiser and the advertiser’s vertical.

 

If we factor 20% additional sales to this keyword to recognise the conversion lag, then the data would change, with the new optimum bid at a higher level. See Figure 3 below:

 

bid simulator table

Figure 3.

 

Three Take-away Top Tips

Hopefully this has given you some ideas on how to make best use of the Bid Simulation and Google adwords tool. Here are three closing points in summary:

1. Use automation to bid simulate and determine optimum max bids at scale based on your main KPI
2. Integrate conversion path analysis into performance calculations to ensure bid changes are not made based on incomplete data
3. Implement and test on high volume head keywords whilst separately optimising lower volume/tail terms where bid simulation data cannot be utilised

 

Good luck! If you have any questions please don’t hesitate to get in touch!