While the “practitioner’s approach” may seem a bit more instinctive and less learned, the many detailed campaign improvements and tests that are the staple of day-to-day full time paid search marketing require the “instinctive practitioner” to be intimately familiar with the core—as opposed to exotic—workings of analytics and stats offerings.

Let’s call the practitioners The Practicer Ones, after their tendency to get down and dirty. The legion of analytics experts with PhD’s or similar credentials: let’s simply call them the Gurus. They’re both important to the profession, and Practicer  Ones who fail to pay adequate heed to the power of formal math are bound to be overmatched in their professional challenges eventually. That said, it’s surprising how often the Gurus  are wrong about stuff, and how infrequently they focus on “quick wins” and “core tasks” of the sort that delight most clients and bosses

Build a powerful campaign

The hallmark of performance-driven marketing is to manage campaigns to key metrics. But management isn’t marketing. So the first background point to keep in mind is that it’s all too easy to go through performance numbers and suggest responses. But how is that campaign built in the first place? What creative and planning processes go into it? Does the person building an AdWords campaign, for example, understand the way to architect a campaign correctly, in stages, so that management of that campaign becomes a meaningful exercise? There’s nothing worse than trying to “tighten up” the performance of an uninspiring, weakly-built campaign. No matter what you do, it’ll limp along at low volume at best.

A powerful campaign, as I define it, is characterized by (just to name a few):

* An understanding of Quality Score fundamentals: CTR and relevancy
* A model of how to test ads in different situations, and a plan for injecting response-inducing creative into the testing process
* A good understanding of filtering options and campaign settings
* A superior understanding of keyword research and keyword matching options
* Understanding ad distribution and reach

Managing everything to ROI

The convenience of tracking software like Google AdWords Conversion Tracker, Google Analytics, and (less convenient but also powerful) third party platforms like ClickTracks and Omniture means that there’s a consensus among the Muddy Ones and Ministry of Math alike that performance based marketing means reacting to conversion performance (or other KPI performance) and adjusting campaigns accordingly.

So that means you can adjust campaigns to keep any aspect or segment—a campaign, ad group, ad, individual keyword, segment of the content network, a time of day, and so on—within your target ROI range.

It doesn’t matter whether you’re a practicer or gurus, this is where the debate actually gets rich in many cases. By ROI, what do we mean?

Practicer  Ones know that rapid iteration is easiest within AdWords and similar platforms if you look at a target CPA (cost per acquisition) figure such as cost-per-order, cost-per-lead, cost-per-registration, etc.

But most of us would agree that on some other (perhaps looser) time frame, we need to look at ROAS (return on ad spend), involving real revenue or arbitrarily assigned revenue in the equation. That can lead to interesting questions related to data loss, time frames, repeat business, and lifetime value. Certainly, the initial customer acquisition should be given revenue credit in long-term planning. So by looking at longer-term data on true revenue associated with keywords and other segments, we gain added insight. The much shorter cookie life of Google AdWords Conversion Tracker means we can’t rely on it alone.

Assists are influential, but to what extent?

And of course attribution takes on even more “art-like” overtones when we start measuring assists. More and more, we’ll be asked to discount the weight of last-click keyword searches (such as a navigational seeming search for the brand’s website) and to give proper attribution to the banner impressions and research keywords that precede it in the buying cycle.

It’s easy to generate smooth talk about that type of issue, but for Practicer Ones, much harder to actually act on the information—especially when we rarely have full assist information today. Just because someone was exposed to some aspect of your multi-channel, many-keyword campaigns doesn’t mean that aspect contributed much to the sale. Does a keyword assist get 15% of the credit? 30%? One-off studies using control groups may have promising information (Gurus love these because they are “walk-away” proof of concept), but to put it bluntly, they have little to do with the patterns of causation in the campaign you’re working on now. That’s someone else’s data, and you can’t verify either the consumer behavior or the related company financials. Nicholas Nassim Taleb would say that overreliance on other people’s studies is another example of The Luddic Fallacy (nerd fallacy, loosely translated).

Practicer  Ones seem pretty instinctive in their behavior, but necessarily so. Because it’s so hard to see what’s “really” going on with every touchpoint, I’ve always felt that beyond the core CPA and ROAS numbers that we work with as a rough guide, attitude is everything. If you’re pro-advertising and bullish on the impact of your brand and website, then more exposure is good as long as it’s decently targeted. I think companies should be afraid of just stopping their advertising on their “on the fence, maybe helpful” keywords, just as they’ve always been afraid of the unseen effects of shutting down broad-based ad campaigns.

CPA tunnel vision: avoid

For rapid campaign iteration there’s no question that you should focus on something like a CPA number broken down by the appropriate segment, such as ad group or ad. Assuming you’ve created something that is worthwhile in the first place, iteration (bid management, ad selection) helps you fix what’s broken and choose the best paths.

But there are three problems related to this.

First, a powerful campaign requires experimentation to find right answers to questions. That includes ad testing and keyword experimentation. Overcautious management to CPA targets will lower volume and may thwart experimentation.

Second: more than lowering volume, there is a problem if your cautious CPA targets create much lower CTR’s than your competitors are generating. Plain and simple, the AdWords ranking algorithm loves high CTR’s. All else being equal, we need to try to build up CTR’s in an account whether we like it or not.

Third: Google’s black-box Conversion Optimizer product is one that automates the process of reaching target CPA’s. But it hampers hands-on tuning and learning on individual keywords. Advanced users should consider using Conversion Optimizer for set-and-forget functionality only once they’ve completed their own intensive process of gauging the performance of many individual keywords and matching options, to say nothing of ads. Third-party, alert-based bid-to-CPA tools are a wise use of automation as they allow the analyst to stay on top of wasteful situations while continuing to get down and dirty (Muddy) with hands-on optimization.

The most important point above was #2. Contrary to popular belief, CTR is a perfectly acceptable stat to include on your short list of core paid search metrics. Indeed, it’s vital, because it’s the most important component of Quality Score and will lead to higher rankings and improved volume for less money per click; thus, not only improved ROI, but more total profit.

CTR boosters

Practicer  Ones like to focus on campaign activities that tend to increase relevance and targeting. So when they use techniques to boost CTR on ads, segments of content, groups of keywords, etc., they use powerful techniques that ideally don’t harm ROI.

1. Improve matching options. Although Quality Score ostensibly normalizes for match type, I still feel that de-emphasizing broad matches and dialing up the emphasis on phrase matches is going to help your campaign on a number of levels. Not only will your CTR go up, but so should your conversion rate. Win-win.

2. Add negative keywords. Judicious use of negative keywords always improves both CTR and ROI. Always. Talk about a win-win. The only risk is damaging volume and profit by over-negativing. Don’t assume too much, just filter the obviously untargeted searchers and those with low buying intent.

3. Test ads religiously. We use a two-stage process that starts with “big wins” in terms of discovering behavior triggers for a particular customer base. At the refinement phase the idea is to use multivariate testing or other methods that will leave you open to discovering ads that create a “double win”—that is, ads that have significantly higher CTR, but harm ROI less than similar high-CTR ads (or in rare cases, actually improve ROI).

4. Find excuses to geotarget. Geotargeting is one of the hottest ways to target even more closely. You might even want to think of excuses to geotarget so you can raise account-wide Quality Score.

In my next posts on this subject, I’ll take a closer look at how to deal with imperfect conversion data, interesting segments to look at, and other core analytics functions that you can access without looking any farther than the Google AdWords interface. I’ll reinforce the above point about CTR’s vital role in successful campaigns.

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What is loyalty

There’s no question that the vast majority of brand loyalty is created post click—once consumers are brought to a landing page with relevant offers and other brand messaging.   However, what happens in that 2-3 second window prior to the click?  A lot more brand building than you think.

First impressions count

Search marketers spend countless hours figuring out how to connect consumers to a brand/product, and then articulate that in an ad that won’t get more than a mere glance.  But despite its short lifespan, an ad must be truthful, deliver value, and resonate with consumers.  In essence, it must set the foundation for a good first impression, which is arguably the most important aspect of building brand loyalty.  Moreover, creating such loyalty takes a mutual bond of trust between two entities—the brand and the consumer.  By capitalizing on first impressions, search marketers can start building trust with their customers and prospects.  This is accomplished by developing ads that clearly outline what they are going to do for them, and then delivering upon those promises.

Three elements of building brand loyalty with paid search

So is it really possible to build brand loyalty in a mere two seconds?  In a word, yes.  It all starts with a good first impression.  Below are three key elements that you should consider in your efforts to build brand loyalty with paid search.

1 – Relevance.

Granted, quality score matters, and the inherent synergies between keywords, ad copy, and landing pages are critical factors in determining it.  However, marketers must recognize that it is trumped by something else entirely:  delivering a consistent message that is on target and resonates with consumers, from the first impression of ad copy to the content on your site.  Irrelevant keywords, copy, or destinations are the quickest way to ruin a first impression of a brand/product.   How so?  Think of it this way:  For all intents and purposes, a first impression is nothing more than a hunch.  When a consumer sees an ad, they choose to either act upon it or ignore it, based upon that feeling.  So when ad copy and landing pages are irrelevant to a search query, you are essentially instilling the idea that you cannot help the consumer, regardless of whether or not it is true.  The result of such irrelevancy should be obvious:  the consumer becomes frustrated, has the lasting impression that you do not have the product or service they need, and goes back to the search results to find a company that does.  Remember, search is a marketing distribution vehicle.  We push content out to consumers in hopes of converting it into a sale/lead, so make sure you are leveraging content that is relevant to users throughout the entire engagement process, and make every impression count.

2 – Messaging.

Consistent and truthful messaging is paramount to building brand loyalty with your audience.  Why?  Because it is fundamental to building trust, and trust is key to any relationship.  Given that, we must do whatever it takes to build this trust with our customers and prospects.  And messaging plays a key role in developing this trust, including the messaging in ads that are displayed in the search results, and the copy on landing pages.  Just as you are asking consumers to eventually buy your products, they are expecting you to be truthful in your ads.  For example, consider the messaging “free coffee.”  Obviously, it implies that a consumer will receive some coffee for free.  When the destination page delivers upon the ad’s promise, it builds trust between the user and the brand.  However, if the landing page does not have the free coffee theme built into it, a disconnect occurs.  The result?  The consumer will bounce, and their trust in the brand will be damaged.

3 – Feedback process.

Implementing a feedback process is crucial to building brand loyalty within paid search.  By listening to your consumers, you can tap into a wealth of knowledge and gain tremendous insight.  But feedback should not be limited to just what your customers have to say (via phone, email, forums etc.), as their behavior on the engines and on your site is also very telling.  Understanding what people are doing with your ads—or more importantly, what they are not doing with them—gives you the opportunity to implement significant changes to your ad copy strategy and increase click through rates (CTR).  But focusing on one metric is never a good idea.  Instead, simultaneously analyzing metrics like bounce rates and CTR can help you tap into even better consumer insights.  For instance, you may have a compelling ad with a high CTR, but if you don’t examine the correlation between it and the high bounce rate of the landing page it is driving users to, then you’ll miss the opportunity to improve the situation, and suffer the consequence:  decreased user engagement, and diminished chances of building trust and loyalty.  Ultimately, search marketers need to work to find creative ways to uncover this vital feedback and leverage it to build brand loyalty.

Though it rarely gets credit for it, paid search can do much to help build brand loyalty.  To fully capitalize on these important first impressions as a brand building tool, search marketers need to make every interaction count by making their content relevant, providing truthful and consistent messaging, and listening to their audience through engine and site metrics.  In doing so, they can help turn customers and prospects into brand loyalists.

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Trotter went to the meeting loaded for bear. “The FOSS community, to the degree that such a thing is possible, had authorized me to go nuclear on the issue before the meeting,” he writes. “I had been given assurance that the community has been so frustrated with dealing with CCHIT that if they did not work with us that if I started an alternative certification program that I would be backed up with the dollars and brains from the community needed to make an alternative certification go.”

The advisability of such aggressive negotiating methods notwithstanding, CCHIT representatives were open to hearing Trotter explain the “profound practical and cultural implications of the ‘rules’ of the [sic] FOSS.” As the meeting wore on, Trotter says he became aware that if the complexities of FOSS were hard enough for him to understand, then relative outsiders to the community would require much more time.

Nevertheless, several important issues came to light, including how to determine who is truly responsible for a codebase without resorting to educated guesses. ZDNet’s Dana Blankenhorn explains, “Before it certifies software CCHIT wants to know who “owns” it and thus takes responsibility. The problem is that open source companies like ClearHealth don’t have full control of their code. Projects can be forked, then re-certified for one-tenth the cost. Or not certified.”

Clearly, ironing out all the issues surrounding healthcare IT certification will take a while, but it’s encouraging to know that CCHIT is open to working with the FOSS community. A recording of Trotter’s presentation is available from CCHIT’s Web site, or people can contact Trotter directly for the ogg version.

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When asked if they would re-write their applications for a platform other than the one they currently support, nearly 56 percent said yes. Google’s Android ranks highest in terms of interest — a whopping 58 percent of non-Android developers plan to port to that platform, while 40 percent of non-iPhone developers plan to port an app to the iPhone platform. In comparison, 26 percent will port to RIM and 20 percent to Windows Mobile. When it comes to the platforms of Palm and Nokia’s Symbian, however, those numbers drop to just 8 percent and 9 percent, respectively.

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Pricing Transparency — Prepare Your Pencils

Whether businesses jump into cloud computing right away or later on, the pricing transparency from cloud providers completely changes enterprise practices for benchmarking IT costs. Companies routinely spend big bucks to understand IT expenses and effectiveness. Top-line ratios based on R&D dollars to revenue are easy to find in SEC filings, but more detailed metrics were part art, part science, shrouded in a murky haze of corporate intelligence.

Cloud computing has changed all of that. Now you can understand exactly how much it costs to rent an x86 server, a terabyte of storage, or a content delivery service with just a few clicks to Amazon Web Services or a host of other providers. Transparency can be granular, too. Amazon S3 now differentiates between storage capacity, data transfer in and out, and number of individual requests.

Whether you use these services today, tomorrow, or far off in the future, measuring the costs and rewards of technology investments will never be the same.

Departmental Decisions — “The Outerprise”

It used to be that deploying a new application meant days or weeks of research, approvals, budgeting, planning and setup. Now it means that individuals outside the enterprise IT domain can pick a service offering of their choice, select a plan, and pay for it themselves. The barriers to start are low, the benefits of scale are high, and the decision gets boiled down to the simplicity of a free trial or impulse purchase.

Granted, this is not the likely sequence of events for major enterprise systems, but for those swirling around outside of the enterprise, in the “outerprise.” Think departmental tools like project management, tailored campaign tools for marketing, an extra reporting service for finance, or an outsourced compute job by a creative developer — the possibilities are limitless.

With corporate IT no longer the sole control point for new application deployments, we’ve only begun to scratch the surface of what an individual worker can accomplish. Perhaps the ecosystem of applications that emerge from “outside the enterprise” will provide the most compelling opportunities, and make application choices more friction-free.

It’s a Choice, Not a Mandate — Let the Markets Prevail

Depending on who you ask, cloud computing may or may not be “enterprise ready.” But everyone agrees the enterprise has already been impacted by cloud computing. Its very existence has marked a turning point in the way companies evaluate and buy new technology.

The emergence of near-universal pricing transparency is an industry first, as far as I can tell. And the opportunity for individual contributors to scope and deploy applications that suit unique needs completely changes the potential growth path of commercially available applications.

These forces will shape the enterprise like never before, breaking down pricing obscurity and bypassing controlled application deployments. With both constraints removed, we have a lot of decision-making ahead of us.

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