Search Engine Marketing Explained6/18/2010

Agenda

1. Industry Overview2. Success Lies In Fundamentals3. Regional Differences: All Markets Are Not Created Equally4. Cost Savings: True Impact Of Quality Scores5. Weed Out Irrelevant Traffic: Negative Keywords6. In-House Teams and 3rd Party Tools7. SMB Challenges & Automation8. Questions

INDUSTRY OVERVIEW

Why PPC?

PPC (Pay Per Click) is one of the most profitable advertising and marketing channels. This view is shared by most online marketers, who in 2007, according to Marketing Sherpa, ranked PPC and email marketing as the two channels with the highest ROI.

What Are The Key Benefits Of PPC Advertising?

• Large volume of traffic – high upside• Receptive to message – want you now

• Not “interruption advertising”

• Highly targeted traffic• “Implied intent” – can show stage in buying cycle• Precise targeting opportunities

• Geo Targeting, Day Parting & Demographics

What Are The Key Benefits Of PPC Advertising?

• Easy to measure – accurate ROI• Control of placement on page• Control of creative messaging• Control of destination• Real-time activation and optimization• Cost-effective & best ROI advertising in many cases

What Are The Key Challenges Of PPC Advertising?

• Slow Adoption• Significant Education• Management Complexity• Time Consuming• Multiple User Interfaces• Technology Variation

Who Are The Key Players?

• Google, Yahoo & Bing results account for 90% of all search traffic.• Google drove close to 80% of US paid search in 2009, up from 60% in 2006.

• Largely at the expense of Yahoo, for which spending share decreased by 12.4%. • Number two, Yahoo!, collected a mere 8% share, while everyone else split

12% of the pie.

$12.20

$13.50

$14.70

$16.70

$19.80

$23.10

$26.10

2007

2008

2009

2010

2011

2012

2013

SEM Spending in North America (Billions)

65%

19%

9%

4%

3%

Google Sites

Yahoo! Sites

Microsoft Sites

Ask Network

AOL LLC Network

Share of Searches (%) in Aug. 2009 By SE

Search Marketing Industry Landscape ~600K Active AdWords Customers

Enterprise

Medium

Small

Local$1

2 B

illion

Ad

dre

ssab

le S

pen

din

g

525K Customers90% Market~$2 Billion (Google Revenues)

70K Customers9% Market~$8 Billion

<5K Customers<1% Market$10 Billion

<100K MS

<50K MS (Pro)

< 10K MS (Pro)

< 2.5K MS (Leads)

>100K MS

Agency

SUCCESS LIES IN FUNDAMENTALS

Key Steps To Create a Successful PPC Campaign?

STRATEGY• Knowledge: Know your target market and product• Goals: Define business objectives• Metrics: Define key performance indicators (KPIs)• Success: Define conversion events• Intelligence: Collect data and assess• Optimize: Make changes and repeat

Key Steps To Create a Successful PPC Campaign?

EXECUTION• Campaign Set-up: Organize campaigns to boost budget & quality score• Keywords: Identify keywords, negative keywords, match types, plural vs. singular• AdCopy: State unique value proposition, call to action, and friendly display URLs• Budgeting/Bidding: Set account & campaign level budgets, keyword bidding strategies• Targeting: Utilize targeting methodologies (geo-targeting, by demographics, day-parting)• Distribution/Networks: Decide which engines you should use. Search vs. content network?• Landing Pages: Chose content, design & images, calls to action.• Tracking & Analytics: Set keyword level tracking (Depth pays off)• URLs (display/destination): Enhance display URLs to increase credibility• Other Third Party Tools: Competitive analysis, market trends, market sizing

Stages For Implementing a Successful PPC Campaign

Industry &

Competitive

Research

Taxonomy

Development

Keyword Selectio

n

Metrics Provisio

ning

Preliminary

Testing

Initial

Optimization

Full Push On All

Networks

Key Components Of Successful PPC Campaign

GEOGRAPHY

Process: Geo-Targeting is driven by the following criteria: Vertical Specification, Population, Density, & Market Competitiveness.

Method: Geo Targeting & GEO Modification.

Level: Zip, City, DMA/ Metro, County, State.

Engines: Google, Yahoo & MSN

TIME

Process: Day Parting is driven by the customers’ operating hours and/ or conversion performance by part of day, week, month, etc.

Method: Work Hours, Workdays, Weekends, Month.

Level: Hourly, Daily, Weekly, Monthly

Engines: Google, Yahoo & MSN

SEO

Process: SEO is utilized to help SEM. This process allows us to get better quality score, drive lower CPC, increase conversion & drive organic conversions.

Method: Relevant, content, optimized Meta, H1, H2 & ALT tags, Titles, Site Map, Page load times, Anchor Text, Multiple Domains.

Engines: Google, Yahoo & MSN

Imperatives: Track These or Lose

Impressions

Clicks

CTRs

Cost

CPC

Avg. Position

Conversions/ Sales

CPA

Conversion Rates

Revenue

Time Of Conversion

ROI

Demo, LTV, Behavioral, etc.

TRACK

Customer GEO

OPTIMIZE

$75

$64$56 $53

$41

$53

$32

$42

$0.00

$10.00

$20.00

$30.00

$40.00

$50.00

$60.00

$70.00

$80.00

December-08 January-09 February-09 March-09

CPA By Month & Build

Client B Created (Legacy) Clickable Created

What To Expect When Right Tactics Are Employed

Clickable overtakes creation & management of 1,500+ accounts across multiple levels of spend and areas of specialization & sub-specialization.

Re-posts 1,200+ brand new accounts (small spenders = aggregate optimization) & overtakes creation of high spending accounts.

Clickable’s newly attained management of the accounts produced in a 3X increase in the overall conversion rate (3.84% vs. 10.79%).

Clickable newly created accounts also outperformed legacy accounts by having a 34% lower CPA. Clickable also managed to increase number of active customers & grow revenue (Ad Spend).

3.32% 3.68% 4.02% 4.36%

10.45% 10.07%

11.79%10.52%

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

December-08 January-09 February-09 March-09

Conversion Rate By Month & Creation

Client B Created (Legacy) Clickable Created

Top 10 Questions You Should Ask Your PPC Team

1. How much revenue do we drive through PPC alone?2. What is our CPA? What is our ROI?3. What is our conversion rate? What is industry avg. CR? 4. What percentage of our budget is fully utilized?5. Are there any opportunities to find more converting traffic?

Top 10 Questions You Should Ask Your PPC Team

6. Do we do geo-targeting? Do we do day parting?7. What kind of tools do we use? Do we use automation?8. Do we do testing? PPC testing and/or landing page testing?9. Do we send PPC traffic only to one location? 10. How are our quality scores?

All Markets Are Not Created Equally

Regional Differences

$14.7 CPC(140K Active Lawyers; Divorce Rate: 2.8 Per 1,000)

Regional Differences

$4.3 CPC(17K Active Lawyers; Divorce Rate: 4.7 Per 1,000)

Top 5 Tips For Utilizing Market Differences

1. GEO Modified Campaigns (National/ Larger Area)2. General Search Campaign (Geo-Targetted)3. Create Local Ads4. Custom Local City & General Landing Pages5. 25 Mile Radius

Quality Scores

Impact Of Quality Scores

Ad Rank = Bid x Quality Score

True Impact Of Quality Scores

0

5

10

15

20

25

30

QS 10 QS 9 QS 8 QS 7 QS 6 QS 5 QS 4 QS 3 QS 2 QS 1

$5.0 $5.5 $6.1 $6.9 $7.9$9.2

$11.0

$13.7

$18.3

$27.5

Impact of QS On CPCs (Same Keyword Different CPCs)

CPC

True Impact Of Quality Scores – Case Study

$75

$64$56 $53

$41

$53

$32

$42

$0.00

$10.00

$20.00

$30.00

$40.00

$50.00

$60.00

$70.00

$80.00

December-08 January-09 February-09 March-09

CPA By Month & Build

Client B Created (Legacy) Clickable Created

3.32% 3.68% 4.02% 4.36%

10.45% 10.07%

11.79%10.52%

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

December-08 January-09 February-09 March-09

Conversion Rate By Month & Creation

Client B Created (Legacy) Clickable Created

Top 5 Tips To Increase Quality Scores

1. Split Keywords into smaller more targeted Ad Groups2. Create relevant ad copy for each AdGroup3. Optimize Creatives4. Experiment with matching options5. Build your SEO

1. Link Building And SEO2. Implement Keywords3. Essential Site Pages4. Make Sure Google Thinks You’re Relevant

Negative Keywords

Negatives: Weed out irrelevant traffic!

True Impact Of Negative Keywords – Case Study

0.65 0.63 0.61 0.66 0.63

1.32

1.561.78

2.01

2.32

0

0.5

1

1.5

2

2.5

May June July August September

Impact Of Negative Keywords On CTR

Without Negatives With Negatives

How To Find Negative Keywords?

1. Keyword Research Tools• Google's keyword tool, wordtracker and keyworddiscovery are typically the first place

advertisers look for negative keyword help.

2. Search Query Performance Report• Once your account has been active for several days, the Search Query Performance

Report becomes the most relevant resource for identifying negative keywords.

3. Your Analytics tool• If you are not using a third party web analytics tool to track your traffic sources - install

one ASAP. Google Analytics is a robust web analytics tool and best of all its free.

4. Competitive Intelligence Tools1. Tools such as keycompete, compete.com and ispioage provide insight into your

competitors' keyword lists.

IN-HOUSE TEAMS AND 3rd PARTY TOOLS

When And How: Build Successful In-House PPC Team

WHEN• DEMAND EXISTS: You have a product or service that can sell• DEMAND FULFILLMENT: You are ready to fulfill demand• ECONOMICS: You are certain that it makes business sense• STABLE STORE: Your web-site is stable & functioning• DEFINED METRICS: Your metrics are well defined• TRACKING: You are capable to track your sales funnel• REPORTING: Make sure that you have a clear visibility into your metrics• COMMITEMENT: Commitment to build and maintain technology & intelligence

HOW• GOALS: Establish clear business objectives• HIRE SMART: Do not try to save on resource, Search is complex and can be costly.• TOOLS: Get Relevant Tools that can help you be more efficient.• EDUCATION: Make Sure Your Resources Understand Your Business.

What To Evaluate When Choosing 3rd Party Vendors?

• CREDIBILITY: Ask for case studies, references, customer feedback• TRANSPERENCY: Make sure that you will have full transparency in metrics• COMMITMENT: Don’t settle for long contracts & commitments• FLEXIBILITY: Vendors should easily adjust as your business goals and needs are changing• SCALABILITY: There needs to be a capacity to grow as your business expands• PRICE: Get a defined pricing model that is beneficial to your business• CLEAR ROI: Make sure that there is a clear ROI opportunity• INTEGRATION: Integration should be simple and should not delay you business growth• SERVICE: Establish clear communication channels and levels of service

SBM CHALLENGES & AUTOMATION

Can We Bring More SMBs To PPC Advertising?

CURRENT CHALLENGES• ADOPTION: SMBs still struggle to adopt new forms of advertising • COMPLEXITY: Diverse and complex user experiences, levels of engagement, etc.• INEFFICIENCY: Most self managed PPC programs fail due to inexperience • EQUIPMENT: High proportion of SMBs have inadequate Web sites and tracking technologies

LONG TERM SOLUTIONS• EDUCATION: Constant education about performance aspect of PPC• TOOLS & PLATFORMS: Create simple and single UE to manage PPC across engines• AUTOMATION: Build automated recommendations that drive efficiency• OFFERING: Provide technology that can scale and provide simple and effective products & services

The Right Approach To Automation

The Right Approach To Automation