When High Adwords And PPC Conversion Rates Are Bad For Business

May 26, 2015

When managing your AdWords account, small unintentional mistakes can sink your business if not dealt with rapidly. Paul Downs, author of the late “You’re The Boss” column in the NY Times, learned a great lesson a few years ago: quantity means nothing without quality.


Paul Downs makes custom conference tables, a business got in serious trouble when he made a change in Adwords

Paul Downs makes custom conference tables, his business got in serious trouble when he made a change in Adwords he thought would be positive.


If you’ve read just about any article on PPC advertising, you’re thinking I’m about to talk about the importance of creating quality ads that lead to robust conversion rates, or that you need negative keyword, or that you need to increase quality score. Well, I’m not. I’m going to assume you’re smart, and probably good looking as well, so I believe you already know all this stuff.


What Paul learned is that quality applies to the conversion as well as ads and conversion rates. Even a robust conversion rate means little if you’re selling your lowest profit items or just drawing window shoppers to your site. Paul did what many of us do, assume that because we’ve got a great product and a solid conversion rate, the problem must lie with the market, issues specific to our industry or the economy. In fact, Paul’s problem, and maybe yours as well, was that his conversion rate was fine but his conversions were neither impressive nor doing too much for his bottom line.


In Paul’s case, he found that by advertising modular tables through his AdWords account, his conversions shot up. This sounds great, right? However, Paul’s ads were bringing non-profit groups and schools to his site, great institutions no doubt, but hardly heavy hitters in the budget department. What Paul, and really all of us, wanted were big spenders ready and willing to open their wallets visiting his site. To do this, investigation in buying habits and the ads themselves were needed.


First, Paul started looking not only at what big spenders were most likely to purchase but when these individuals were most likely to make contact. To his chagrin, he discovered that the ads that had the most success at leading his most sought after customers ran at times they were least likely to see them. In fact, he found that the ads that generated the largest number of impressions, those that were also drawing in the least profitable customers as well, were the ones in highest rotation.


On the other hand, many of his ads that had great conversion and click-through rates were being shunted to the side in favor of ones that had sub-par performance. The likely explanation being that Google makes the most money on ads that get lots of impressions and clicks, irrespective of click-through rates and conversions. While Google makes bank, you may as well be feeding dollar bills into a fire for all your ad budget is doing for you.


This problem sneaks past many people for a very simple reason: according to the metrics of an AdWords account, these types of campaigns appear successful on the surface. Ads are generating large numbers of impressions and click-throughs, and sometimes they have a solid conversion rate as well.


Fixing your AdWords campaign may not be as simple as driving a stake through the ads that suck your budget dry. It is likely that you created these ads for a reason, even if you never intended them to gobble the money you have allocated for your campaign. By creating different campaigns and setting different budgets for each, you can ensure that your most profitable ads are leading the way.


Once you’ve determined which ads are causing problems, which are successful and split them into appropriate groups, you come to the hard part: waiting. Set a review date, and don’t mess with your campaigns until then. The urge to tweak your campaigns on a daily, or hourly, basis is likely to be strong. However, results don’t generally show up overnight, so sit on your hands or take up a hobby, but give your new campaigns time to work or fail.

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