The experts will tell you that paid search marketing is essentially recession-proof. As Joshua Stylman suggested last April, paid search has 3 major things going for it that will keep customers in: Accountability, Efficiency, and Control. To summarize:
Data, data, data! Paid search managers can see exactly where their marketing dollars are effective and adjust keywords that are not performing. If a particular campaign is not performing up to standard, it can be tweaked or even removed within minutes. The accountability and flexibility make paid search extremely efficient. Search engines enable you to choose what to spend on, how much to spend, and where to spend it as slowly or quickly as you want. They have even implemented features such as daily budget caps and geo-targeting to help you control this spend even further. In addition, the quality-based ad ranking feature allows an even greater level of efficiency; as your quality score improves minimum bids go down and ad rank goes up. This means ROI is almost 100% controllable. Has there ever been a more business friendly marketing model?
Obviously, there are great benefits to using and even increasing your use of paid search. Several companies are shifting marketing dollars from more expensive traditional mediums to the more accountable and efficient alternative. So, why is Google tightening it’s belt just like the rest of us? Why are major companies in certain sectors spending less than half of what they spent last year?
Conversion!
While consumers are researching more, they are not spending as much as they did in years past. According to OMD (courtesy of Search Insider), nearly three-quarters of consumers report they spend money more cautiously in a recession and 62% are “more likely to window shop, but not actually buy something.” However, based on the success of the largest retail liquidation in U.S. history, I think consumers are willing to buy if you give them a reason. How do you get them to buy? Give them a good deal! Many internet retailers try to remain price competitive for this reason. The web is a haven for price-conscious consumers as going to the next store to compare prices is as simple as clicking a button.
Unfortunately, unless your company can afford that lowest price, it will NOT work for you. For example, over the past year, I tested promotional copy vs control ‘official site’ copy on a retail website. The promotion would include a ‘Save up to…’ message on what the merchants were advertising on the site. From January – August 2008, I was ready to chalk this test up as inconclusive. On any given week, the best performer was a toss up. However, as the slowing economy went into a tail spin, promotional copy began outperforming the control copy on CTR across the board. So, why was the use of promotional text deemed a failure? Unfortunately, due to lower margins on purchases made by promo-clickers, CPC did not leave us smiling. The Wal-marts and Amazons of the world can undercut their competitors because the have set up their entire infrastructure to compete on this.
Promotions will work for us too, but the rest of us have to be more creative. Testing different concepts to see what customers respond to is very important in a time like this. A “good deal” for your company might involve special financing, long-term warranties, special technology advantages, or loyalty messaging. Make a list of your competitive advantages and come up with copy that represents this in an attractive way to the consumer. For example, save 50% on [insert superior product here] over 3 years with our higher quality line! Finding copy that works will require much testing. Patience is a virtue at this phase.
In paid search, the landing page plays a key component when using promotional copy because you have limited space to explain your promotion. Landing page testing is also important, but because we have already decided that a promotion will work in this economic environment, we have a head’s up on what types of landing pages will work. If you are going to run a promotion (based on price or based on competitive advantage), landing customers on a page that features that promotion and the relevant products or services will work much better than landing that customer on a product list page where they will have to search for those deals. If you say, save 50% over 3 years with higher quality, you better explain that or your user will hit that back button as quickly as it took them to read the 70 characters in your paid search ad. Make the most out of your limited ad text by making your landing page as relevant as possible! Your quality score will also thank you as the low bounce back rate and high relevance are deemed a hit!
To find the right copy and landing page combo, you will likely need to test, analyze, and test again until you find one that works. When you test, remember to turn off the automatic ad rotation. Ads with higher CTR will automatically be displayed more frequently. This is a benefit for everyone. However, ads with longer history (such as the ‘control ad’ you choose) may have a better history of performance and therefore skew initial results and mess up your test. Take control of what’s being seen so you can measure the results effectively by rotating each ad evenly. Keep a close eye on the data until you find a promotion that works for you.
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