Articles written in September, 2010

September 27 2010

Gross Rating Points for Display Ads


Internet advertising is growing in leaps and bounds, largely driven by innovation, but pales in comparison to TV ad spend as illustrated in the chart below.


As innovation continues to produce new products and services geared toward expanding the reach and access of the Internet, more eyeballs are available for advertisers to closely target and measure the success of their ads.  A sign-post of this continued growth is the announcement by Nielsen Company that they will be providing new data for media buyers concerning Gross Rating Points (GRP), the formula used by the TV business for decades. It is reported that the online GRP data Nielsen will offer consists of a blend of its demographic panel data with the information gathered by participating online companies, like Facebook.  Nielsen has lured Procter & Gamble to test the new data.  The data, which will vary from website to website, will consist of anonymous information such as age group, sex and location.  This should assist advertisers to better deploy and measure the success of their display advertising, which generally has a large number of impressions, with few clicks.  If an advertiser can increase their click-through rate for their display ads, they will continue to allocate more money to this channel based on the information such as GRP.

It will be interesting to see how the balance between ad spend online versus TV shifts as more and more people use the Internet for consuming media.

September 27 2010

More Opportunities for Testing


Those of you who are familiar with Google Website Optimizer (GWO) know the importance of testing your online marketing efforts.  Testing really is the best way to know whether or not proposed changes to your website are going to have a positive or negative impact on your bottom line.  If you haven’t tried a GWO experiment, I would highly recommend it.  For more info on conducting an experiment, you should read the blog post 6 Critical Steps for Starting you Google Website Optimizer Experiments.

The world of website testing is continuing to develop, which is great.  All online marketers should be testing their online marketing initiatives, whether it is elements on their website or keywords within their campaigns. Google AdWords has followed Google Website Optimizer’s lead and is now offering another way to conduct tests; this time with your AdWords campaigns. This new program, called AdWords Campaign Experiments (ACE), will enable you to test changes to your bids, keywords, and ad groups before applying those changes to all auctions for which your ad could appear. 

For example, if you want to measure the impact of increasing a keyword’s bid, you can easily accomplish that without having to test all auctions.  With ACE, you have the ability to select the control / experiment split for your changes. You can choose 50% control / 50% experiment, 60% control / 40% experiment, and so on.  Similar to GWO experiments, ACE runs the experiment or test seamlessly with the existing campaign set up.

This tool can be found within the settings tab for your campaigns, and since you can set the experiment splits and the start and stop dates, you lower the risk of testing new ideas.  If you want to test increasing a keyword’s bid without ACE, the new bid would be applied to all auctions.  The problem is that even if the results were good, it is difficult to be 100% positive that the results were not due to other contributing factors.

So, next time you are thinking about making changes to your campaigns and would like to test the results first, look into using ACE.  It may help you to determine whether or not this change would be beneficial.

September 22 2010

Enhanced CPC = Increased ROI + Lower Cost-Per-Conversion


Google AdWords has released a new automatic bid management feature, called Enhanced CPC, which is designed to increase your ROI on Max Cost-Per-Click (CPC) campaigns, while maintaining or even reducing your overall Cost-Per-Conversion.

How it works:
Google analyzes your CPC campaign’s historical conversion tracking data along with factors such as user search query, geography, time of day, web browser or operating system. Then, when your ad is eligible to appear, it will automatically raise or lower your Max CPC bid based on the probability that your ad will convert. If your ad has a high chance of converting, your bid can be raised as much as 30% over your Max CPC bid, and lowered if a different ad has a higher percentage of converting.

Unlike other optimization efforts from Google AdWords, this new automatic bidding feature works with ad scheduling, position preference and demographic bid multipliers. Enhanced CPC also works on Google Network Partners (AOL, Ask, etc.) and Content Advertising. However, the feature is not available in AdWords Editor.

As a Campaign Manager, I have started using Enhanced CPC for some e-commerce clients and have seen an increase in transactions without any other changes. For one client, I experienced a 39% increase in transactions with a 45% decrease in Cost-Per-Conversion, along with a 9% decrease in advertising spend.

Enhanced CPC gives you the winning formula for your ad to receive more conversions, without increasing your Cost-Per-Conversion, and eventually increasing your ROI.

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