Top 5 Secrets for Increasing Your AdWords ROI

AdWords is a very democratic system – you find keywords you want to bid on, compete in a realtime auction with others, and the highest bidder gets to display their ads. But just like any real-life auction, there are secrets and techniques for reducing the cost of playing the game. One of the easiest ways to discover what search engine marketing (SEM) professionals are doing is to look at the ad campaigns of major companies in highly competitive businesses such as travel and dating.

Here’s a quick run-down of the insiders guide to beating down the cost of AdWords while increasing clicks and conversions:

1. Select highly specific keywords.

Bidding on general keywords such as travel is not only expensive but way too broad to provide content that matches what the user is looking for (that particular keyword is dominated by firms such as Orbitz and Priceline). Using the Google Keyword Tool, “travel” was searched 151,000,000 times in one month alone:

The problem here is that while it guarantees many hits if your webpage appears in page one of those search engine results pages (SERPs), the cost to appear in the paid list would be exceptionally high. Getting good results from search engines is about specificity – narrow down the precise topic that your webpage is about. If you are offering tours of celebrity neighborhoods in Hollywood, the phrase “celebrity tours” would offer less traffic but the visitors would be specifically interested in what you had to offer:

Use search phrases with at least 2000-5000 monthly searches – since less than 1% of search lead to clicks, anything less than will not attract enough traffic.

2. Use the keywords in the first line of your ad.

Users are telling you what they are most interested in through the keywords they select. You should mirror back the subject of your page by reflecting those keywords in your ad. Here’s a great example, searching on flights from San Francisco to Austin using the keywords “sfo aus”:

In this user, the searcher’s attention is immediately drawn to the first ad “SFO to AUS Flights”, rather the 2-5 spots on the right, many of which misunderstand the context of the search. OneTime.com’s ad is particularly clever, since they’ve identified a niche variant of the search using airline code shorthand rather than the full “flights from San Francisco to Austin”. The click-thru rates of ads that reflecting keywords in their headline is substantially higher than those that don’t. Also, Google will highlight keywords on the page, giving your headline extra emphasis if it contains the keywords.

The one exception to this occurs when advertisers set up dynamic ads that reflect keywords even if the product is not sold by the retailer. The causes clicks with 0% ROI.

3. Use the keywords again in ad-specific landing pages.

If you are using AdWords (or any PPC system), you must use landing pages. Many advertisers invest heavily in ads and then funnel the click to a generic page such as the home page, and wonder why those leads are not converting into sales. Web users are so fast to scan a page for relevance that they simply will not spend time search your site unless the first page they arrive on (the landing page) looks to be highly relevant.

You should ideally have one landing page per keyphrase, so that two ads with “celebrity tours” and “hollywood tours” would leads to two separate pages each reflecting the two phrases.

In the example from above, the landing page used by OneTime.com reflects my search terms in their H1 headline (AUS/SFO), shows relevant deals in the right-hand panel, and even pre-populates the search fields with the correct airport codes. This page is highly-relevant for my search is a likely to make me continue through with my purchase.

Building targeted keyword-rich landing pages should be seen as part of the process of building ads.

4. Capitalize the First Letter of Every Word in Your Copy.

With the exception of words such as ‘in’, ‘of’, ‘for’ and so forth, capitalizing every read leads to improved readability and click-through rates. In the example below, searching for the term ‘”SEO”, every ad uses this technique except one (one that makes the spurious promise of top 10 SERPs placement).

5. Don’t always bid for the #1 spot.

The order of the ads is determined by how much each advertiser bids for the keyphrase. Most advertisers are striving for the number one position, as they know that most users visually “F” scan the page, which provides an advantage for content higher up the page. Interestingly, while it’s true that the first ad is usually the one clicked most often, it’s also the one that typically has the worst percentage for conversion. So it’s easy to use your entire budget on clicks that don’t result in sales just for the sake of being the first ad.

Clearly you want your ad to appear on the first page of search results, but very frequently aiming for second to fourth placement will provide a healthy number of clicks with more reliable conversions, while stretching your ad budget more effectively.