How to Optimize AdWords for ROI

A reader wonders:

“I am tracking conversions, just wondering how someone whose seen a gazillion AdWords campaigns approaches optimization.  Is there a system or do things just pop out based on your experience.”

My response:

Things do pop out at me at this point (I flatter myself by imaging my brain working like Russell Crowe as John Nash in A Beautiful Mind – before he went crazy), but it’s a result, I think, of just adoping a process and practicing it until it became second nature.

Here’s my system:

1. Set up conversion tracking, as closely related to actual dollars in as possible. If you can track online sales, do that. Use the actual ecommerce sales totals if you can. If you can’t track sales online, then track leads. If you can’t track leads, then use analytics to track time on site, or use AdWords conversion tracking to track views of a key page.

2. Sit down and make a list of my questions. Before diving into the reporting, decide what you want to know. If you just go in wondering, “What is all this data?” you can get lost for days. Enter the spreadsheets with a “search image” in mind – a specific question or set of questions.

For example:

  • Which keywords cost more than they’re worth?
  • Which ads make me the most money?
  • Which sites on the content network are delivering bad traffic?
  • Do prospects in different parts of the country or the world respond differently to my marketing?
  • Are there certain days of the week or times of the day when I shouldn’t advertise?

There are dozens of potential questions you can ask – and since every business – and every business owner – is unique in some respects, no one can hand you your list of important questions without knowing something about your circumstances.

3. Set up reports that answer those questions.

4. Filter the data so you end up with,not just information, but as Jim Collins puts it in Good to Great, but “information that cannot be ignored.” You can do this manually, or with the Magic AdWords Button.

5. Take action on the data – pause non-performing keywords, annoint ad split test winners, find new negative and positive keywords, use the Google Ad Planner to identify new content sites based on existing good sources of traffic, etc.

6. Ask new questions and repeat.

This is the process you’ll master in AdWords Ball – the first official class is Thursday 12/11/08 – learn more here.

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