Although Google today is conquering our lives through the digital revolution, its initial success is owed to its introduction of an ingenious and original marketing tactic – Google AdWords. The idea was simple. Google owned the most powerful and comprehensive search engine algorithm available on the Internet. The question was how to monetize it.
Google AdWords displays advertisements with keywords relevant to the search queries that a user feeds into the engine. The advertiser pays Google for every click on the advertisement link. Although this sounds pretty simple, AdWords generated so much revenue for Google that it is arguably the key to Google’s success today. In fact, Google makes more than $100 million per day through Adwords.
But does AdWords really work for the advertiser? From personal experience, many of us can say that we tend to neglect the ads that crop up in our search pages. But Google’s AdWord revenue proves that the ads do get clicks, and a lot of them. But do they get converted into sales? If so, how? These are the questions that we are going to try and answer in this article.
AdWords is structured as a live auction of keywords. What this means is that, as a seller you can bid on a set of keywords or search string. Say you are a t-shirt vendor in Mumbai; you can bid on the keywords ‘Buy a t-shirt in Mumbai’. Your aim is that every time these keywords are searched on Google, an advertisement for your website must appear along with the search results. But of course, there will be competition. To decide which advertiser gets the space on the results page, Google calculates an ad-rank.
Ad-rank = Maximum Cost per Click bid * Quality Score.
Google assigns a quality score to every set of keywords that you bid on between 0 and 10. The quality score is based on factors like click-through rate, ad copy, geographical considerations, landing page quality, etc. So, as an example, the keywords ‘Buy a t-shirt in Mumbai’ might get a quality score of 8. Say that you bid Rs.100 per click on this keyword. Your ad-rank then becomes 8 * 100 = 800. The higher your ad-rank, the better chances of your ad being displayed on the search results.
The key to AdWords success is that as opposed to page rankings, which depend heavily on SEO and other factors, Ad-ranks are purely a result of a higher bid and a better keyword to bid on. This means that it is relatively easier to get a high ad-rank and be displayed top-of-the-list on AdWords, than it is on the actual search results. Of course, there is no point bidding an exorbitant amount on a bad keyword. You will get a high ad-rank, but it won’t be of much use, which takes us to the next important step in AdWords – identifying great keywords. The aim is to achieve a high quality score and then bid on it.
Here is the crux of the matter. Up until now, you were only fighting for the space to advertise. Think of it like this – You and your competitors are fighting for advertising space on a billboard in the hottest area in town. After a long struggle, you win the space. But if you display an uninteresting advertisement that fails to convert into sales, all your time and money is wasted. So firstly, make sure that the landing page to your advertisement has potential to convert leads to sales. Secondly, bid carefully. Don’t count your chickens before they hatch.
For more information about AdWords and other queries, get in touch with Browntape. We are always happy to help!
Browntape helps retailers sell online on multiple marketplaces like eBay, Amazon, Flipkart, Snapdeal, etc. in India. They provide services and software that allow retailers to either outsource their online selling business or manage things on their own using their innovative inventory and order management software. In addition to that they also help sellers improve their customer experience.
Source: Browntape Blog