How to Win the PPC Championship

bcs-2012Last week, in American college football, No. 1 ranked LSU faced No. 2 ranked Alabama in the NCAA Bowl Championship Series national title game. It was the first time two teams from the same conference squared off in the title game, and was hyped to be a great rematch between two tough teams. LSU hoped they could come out and prove they deserved their No. 1 ranking.

The outcome, though, was almost embarrassing: LSU only crossed the 50 yard line once and got shut out. They came out flat and lost the game with everything on the line.

So what does football have to do with PPC?

In PPC, I like to view the page fold as the 50 yard line, and the top ad positions as the red zone. In American football, a team is said to be in the red zone when they’re 20 yards or closer to the opposing team’s end zone. It means they’re in scoring position.

In PPC, it’s great to grab one of the premium positions above the search results – but you can still score (i.e. convert) even if you’re in a side position.

But you won’t win if you can’t cross the 50.

So what keeps PPC advertisers from crossing the 50 yard line of search?

Playing Too Conservative With Bids

Many novice PPC advertisers want to “test the waters” to see if the channel will work for them. They set really low bids, often at the minimum of $0.10 per click.

While setting bids that low guarantees you won’t spend much money, it also won’t get you anywhere near the 50 yard line.

The reason has to do with a little thing called quality score. While several factors go into determining quality score, the one thing new advertisers need to focus on is click-through rate (CTR).

CTR is the most influential factor in the quality score algorithm, so it’s vital to establish a good CTR right away. It’s not much of a stretch to understand that if searchers can’t see your ads, they’re not going to click on then. Really low bids can ruin an advertiser’s chances of getting clicks, just like running the ball up the middle can keep even the best running back from gaining yards.

A better strategy is to take some risk early on. While you should never bid more than you’re comfortable paying, it’s important to set bids high enough to cross the 50 in the early going. Once quality score is established, you can start to ratchet bids down.

Playing Too Conservative With Daily Budgets

Let’s assume your bids are set at a decent level. Even with high bids, you can limit your production if you set daily budgets too low.

Low daily budgets are surprisingly common – some experienced PPC managers will set bids at $5 per click and campaign daily budgets at $10. Simple math tells you that you won’t get many clicks that way – just like you’ll never find out how good your wide receiver is if you only throw two passes to him in a game.

As with bids, you shouldn’t set budget caps that you’re uncomfortable with. But in the early days of a campaign, it’s better to set the budgets high so you can assess the total traffic potential for the campaign.

I like to start with $500 or even $1,000 per day – and I watch it like a hawk so I’m prepared to pull things back if it actually spends that much! Doing things in reverse (i.e., starting low and then ratcheting up) isn’t as effective. It takes longer to get the spend ramped up once you’ve set a low cap, so it’s better to aim high.

Establish a Lead

In football, as with many sports, it’s important to come out strong early in the game and establish a lead. Once you’re a few touchdowns ahead, you can start to play the game more conservatively to preserve the lead, because it’s very hard for opponents to come back and win.

In PPC, make sure you set bids and budgets at a level where you can cross the 50 as quickly as possible, and then adjust as needed to a level you’re comfortable with. By establishing an early lead, who knows – you might even win a national title!

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