INTRO from Gail: Some of you may know that I managed Pay per click (PPC) accounts including Google AdWords for 5.5 years. I hate to see people losing money or letting the company that wants you to spend more manage their accounts. So I asked Lior Krolewicz from Yael Consulting to contribute this post for my readers.
When Google Ads (formally “Google AdWords”) first launched in October of 2000, the platform was simple and there was little competition on it.
Few businesses were advertising on Google, and many didn’t even have a website to advertise. This meant that most early adopters were able to easily utilize Google Ads to drive results and increase online visibility.
It was a do-it-yourself opportunity that required little effort and paid big dividends.
As more businesses caught on to the power of the internet, websites became an essential tool. From there, online advertising grew and the auctions for pay-per-click ads increased.
With more competition for keywords came more expensive per click prices. The Google Ads interface became more sophisticated, but it was still manageable for most lay people and business owners.
The past 3 to 4 years have seen the most significant changes to Google Ads and these changes are making it more difficult for businesses to get positive results out of PPC advertising.
Competition ballooned exponentially, driving costs up and profits down. But Google has also continued to create an increasingly complicated interface that requires more expertise and makes it easier for business to lose money.
So, if your Google Ads haven’t been hitting it out of the park lately, you may not be to blame.
How Google Ads Is Changing
Google is pushing to take the control away from the advertiser and allow Google to “optimize” and target as it deems “best”. This is apparent in fundamental features like “Exact Match.”
In the past, when you entered a keyword like “dog food” in Exact Match, your ad would only show up when someone searched for that exact phrase. About a year ago, Google changed this so that your ad now shows up in broader searches.
Here is a snippet from Google about this change:
“We’ll show your ad when someone searches for your keyword or close variants of your keyword. Close variants may include:
- Singular or plural forms
- Stemmings (for example, floor and flooring)
- Reordered words with the same meaning“
So exact match is no longer Exact Match. Instead, this feature allows Google to display your ad in additional searches. As a result, both you and your competitors appear more often, and ad auctions have significant overlaps.
Since you are no longer completely in control of where your ads appear, keywords are more expensive per click. This makes is easier for you to lose money on PPC advertising.
How Automated Bidding Affects Your Ad Campaigns
Another major change has been the addition of the “automated bidding” feature. This allows you to program your campaign to automatically set bids for all the keywords in a campaign according to different goals. For example, “maximize clicks” or “maximize conversions” or to hit a “target CPA” (cost per acquisition / conversion).
In theory, this feature sounds amazing because it uses Google’s full technological abilities to maximize results for the advertiser. Unfortunately, this simply isn’t the case and this feature can actually eat away at your PPC marketing budget.
For example, it is possible for Google to take a look at all your keywords and single out your least relevant keyword in order to maximize your clicks. However, this will result in the lowest quality traffic and lower conversions.
In another case, Google may hit your $70 cost per conversion, but it may do this by getting conversions from one keyword at $10 and then two more conversions at $100 each. In both cases, Google has hit your objectives, but failed to find the right balance between cost and quality and you have just wasted money.
By giving Google more control over who you target and how much to pay per click, you are giving Google carte blanche to spend your budget. While Google will quickly run through your money, your budget will rarely be spent in a way that benefits your business as much as possible.
Beware of Google Ads Specialists
If a “specialist” from Google calls you, be extremely careful about taking their advice. Typically, they will recommend that you “target broader” and “spend more.”
Keep in mind that Google is not assigning real experts to cold call you and help with small budgets. Instead, you are speaking to salespeople who have zero accountability when it comes to your ad performance.
In fact, many small business owners who contact me for help usually do so after a “Google specialist” destroyed their account performance. With no accountability for actual results, they will rarely offer advice that is in your best interest. Instead, they are preoccupied with meeting their own sales goals and quotas.
How to Get the Most Out of Google Ads
The solution is to take back control of your advertising by carefully creating your account structure, customizing the settings and monitoring your accounts closely. If you have been using the same account structure for over 4 to 5 years, there is a real chance that you are losing money on a daily basis
Today, reputable and trustworthy Google Ads experts offer free account audits where they show you exactly where you are losing money and pinpoint opportunities for improvement before you even sign up for services.
Often, they are able to show you how the money you lost over the past 30 days, could have more than covered the cost of hiring them.
While businesses are often hesitant to hire outside help, new Google features are making it nearly impossible for the average business owner to effectively run ads without losing money.
[Editor Note: Please listen to this advice. It is exactly the same advice I have given since the beginning of Google AdWords. Their goal is to get you to spend more money. Your goal should be to get the most profit from the least amount spent… Gail]
As Google Ads becomes more complicated and expensive, small businesses find themselves in a position where they need Google advertising to generate leads and sales. But their campaigns are becoming less effective by the day.
Ultimately, Google Ads can be profitable and an amazing channel to grow your business online. But just like the investing in the stock market, if you are not an expert, it becomes very easy to lose money. If your Google Ad campaigns are performing poorly, it is time to call an expert.
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- Google Ads Campaigns Not Performing Well Lately? It’s Not You. It’s Google! - November 1, 2019