It’s time for another Online Advertising Answers! Follow me through three of the most interesting questions I’ve been asked on Quora.
This month I answer:
- Can I use too many keywords for a Google ad campaign?
- Are banners still a good way to advertise?
- What does it mean to ‘calculate your eCPM’?
Let’s get started...
A: “Hi Thomas,
Yes, there is such a thing as too many keywords for a Google ad campaign. The general guidance is that between 5–20 keywords is optimal for each ad group, and in most cases the more you go over this the worse your campaign will do.
This is because you should use Ad Groups to tightly target individual themes, and staying under 20 keywords helps you focus in this way.
Why you should limit your keywords
Think of it this way – say you sell 10 types of Bikes – each a different colour. You have one category page on your website for all the bikes, and then one page for each type/colour of bike.
You could set up an Ad Group on Google ads targeting every bike-related keyword you can think of, and then use your main Bike category page as the landing page for that ad group. As you are targeting so many different searches, your ads would have to be pretty generic in order to make sense to anyone who saw them.
So now imagine someone searches for “Blue Girls Bike for 11-Year-Olds”. Great – you both have those in stock and your ad is shown to the searcher. However, two other ads will be shown to the searcher too, and then, of course, there are all the organic search results to compete with too as well as other types of results.
And remember – your ads just talk about bikes for sale in general, but this person is looking for a specific type of bike. As anyone would – they’ll probably click on a link sounding the most like it will fulfil their needs. Lots of places sell bikes after all, but how many of them have “Blue Girls Bike for 11-Year-Olds”? You do – but they can’t tell from your generic ad!
So instead of having a generic ad for all your bikes, you should ideally break down your ads into smaller ad groups, with ads targeting each of your products individually. This, in turn, means having less generic, and more specific keywords in each ad group. So the next time someone searches for “Blue Girls Bike for 11-Year-Olds” they would see your ad saying “Blue Girls Bikes for Sale” instead of just “Bikes for Sale”.
This makes you much more likely to get a click at least.
This more specific sort of keyword is known as a long-tail keyword. Searches for long-tail keywords (such as “Blue Girls Bike for 11-Year-Olds”) make up the majority of searches, however, not many people search for any specific one of them.
So for example, while a lot of people use the term “Bikes” in their searches, not many use “Blue Girls Bike for 11-Year-Olds”. However, when ads match these long-tail searches closely, they generally perform much better.
What this means in practice is that you have to decide how much to break down your targeting into smaller groups. You need to think about your budget and the number of people likely to search for any individual term.
How to Choose Keywords
The top advantage of Google Ads over other types of advertising is it’s ability to convince people who aren’t quite sure. This is because when people see these ads they have already searched for something. It’s not like being handed a leaflet while you’re walking down the street – people seeing Google Ads already want to click on a link, you just need to make sure it’s yours.
Due to this, Google Ads offers probably the simplest advantage there is in online advertising – if you pair it with Search Console that is. That advantage is size – by running an ad on search results page where you already rank well organically, you can double (or more) the amount of page real-estate you take up. While this may seem dumb (you’re already on that search results page!), taking up twice the amount of space on that page actually pays serious dividends. It’s a sort of 1+1=3 situation – as if you add up the results of an ad alone and an organic search result alone they still don’t perform as well as both combined.
So how do you do this? Well just go into Google Search Console, look up a page you want to advertise, and choose the top 5–10 search queries for that page and use those as the keywords to target. That’s it! You can use them all as exact match keywords, or combine them down into phrase match keywords if you like (which is actually better).
Use these same keywords in your ads, and on the landing page they go to, and you should maximise your conversions.
Pro Tip: Search Terms
Every now and then you should go into Google Ads and look at the actual search terms used for an Ad Group. Add any especially successful ones (as Exact Match), and add any irrelevant ones as negative keywords. This will keep your keyword game pretty strong.
I hope this helps,
PS Lots of people talk about SKAGS (Single Keyword Ad Groups) but these aren’t for everyone. You need lots of money, time, and potential traffic for these to work, so you should ignore them unless you hit all three of these criteria.“
A: “Hi Ernest,
Online banner ads (or Display ads as they are also known) made up almost 13% of global ad spend in 2018, up from just over 11% in 2016. If banners weren’t a good investment this number would be falling, not rising.
[Just to put this in context – newspaper advertising makes up about 8% (and is falling fast each year), and social media advertising makes up about 2% (and is growing slowly each year).]
With digital marketing people can divert their budget to where-ever performs the best pretty easily, meaning a bad channel wouldn’t last.
Whether or not banners work for you is a different question. Like any form of advertising, you have to be able to find your audience with your ads, and to be able to run a good ad campaign. If you can do both of these things with banner ads then you should probably try display advertising.
If you’re looking for a place to start try Google Ads as they’re easy to use.
Note: Display advertising can be incredibly cheap per ad, however, to run enough advertising to make it work generally requires a reasonably large or ongoing budget. If you have under £100 to spend per month (or a single lump sum of under £1,000) it is quite likely a much better bet to try social media ads instead.
This is simply because you can run a post on your social media page, and if it does well then you boost that post. This effectively removes the testing phase of running your ads (and testing can really eat up your display advertising budget if it’s not very big).
I hope this helps.
A: “What CPM and eCPM mean
eCPM stands for effective CPM, or equivalent CPM depending on who you ask. Both mean the same thing, however – what the CPM would be of something which isn’t actually charged on a CPM basis.
How to calculate your eCPM
You can work out your eCPM using this formula:
Click to enlarge
eCPM = (ad spend divided by ad impressions) times 1000
Or else you can use this eCPM calculator to save time: eCPM Calculator (Effective CPM)
Why eCPM is useful
If you own a website and want to know how much money you are making from advertising on your site, calculating your eCPM can be very helpful to compare the performance of advertisers paying in different ways.
eCPM is also useful in planning for the future – if you know that your site gets an eCPM of $10 then you can use that figure to estimate how much you will make each month.
Equally, if you are advertising in lots of places in lots of different ways, and simply having your ad seen lots is your goal, then eCPM is a good way to compare the cost of your different ads. (In most cases though, CPA or ROI would be a better measure for advertisers).
Calculating the eCPM of an ad campaign
(An ad impression is one single time an ad is shown.)
Cost: $2 x 10 = $20
Impressions = 2000
eCPM = (cost / impressions) x1000
eCPM = ($20 / 2000) x1000 = $10
This means that the CPC was $2, but if it had been run as a CPM campaign it would have cost $10 CPM.
Advertiser A is paying $5 per click
Advertiser B is paying $50 per conversion
After three months you have to decide which advertiser to give more space to.
The results are:
Advertiser A: $25 revenue, 5 clicks, which took 10,000 ad impressions.
Advertiser B: $100 revenue, 2 conversions, which took 50,000 ad impressions.
On the surface, the $50 per conversion sounds like a much better deal, and it earned four times as much money.
However, if you work out the eCPM of both:
Advertiser A: ($25/10,000) x1000 = $2.50 eCPM
Advertiser B: ($100/50,000) x1000 = $2 eCPM
From this you can see, that Advertiser A is actually performing better. In a practical sense, this means that for every 1,000 ad impressions you sell to Advertiser A instead of Advertiser B, you will earn an extra 50 cents.
In this way, the eCPM is essentially the cost per kilo of online advertising. 1,000 views of an ad is like one unit, and the eCPM shows you how much you are selling it for.
Note: eCPM is just an average. In the above example, the CPC advertiser might not keep performing as well if given more space. Therefore you should keep a mix of advertisers running and keep optimising to find the sweet spot.
Impression RPM and Page RPM
You can also work out the eCPM on a larger scale if you want, and simply add together all the money you made from advertising, and then use all the ad impressions you served to work out your eCPM for your whole site. In AdSense, this is called an Impression RPM.
You could equally work out a Page eCPM (or Page RPM) by using the total revenue received and your page views instead of ad impressions. In a lot of ways, this is a more practical measure, as you can work out your pageviews easier than your ad impressions in most cases (due to ad blockers etc).
I hope this helps.
I hope this all helps,