Shifts in Strategy: Staying Ahead in the PPC Marketing Game

Does PPC work? Absolutely. Is PPC cost effective? It has been. Is PPC a viable marketing strategy? Absolutely, but with some adaptation. Back in 1996 when Planet Oasis launched the first PPC advertising campaign, companies vied for top spots,  or “preferred listings,” on host websites that attracted the most web traffic. With the Yahoo search engine on the rise and the birth of Google, soon to become the nexus of internet navigation, PPC advertising rapidly became a leading strategy among content marketing firms. By 1997, in only a year, over 400 major brands were using PPC advertisements for the majority of their web-based marketing.

As PPC campaigns grew, so did the bidding system for companies who competed for the top ad spots. In 1998 GoTo.com launched the first bidding system that used the click-based payment system, when businesses paid a certain price to the host website for each time their link was clicked (as opposed to previously paying only for the preferred listing spots).  A year later GoTo.com launched their real-time keyword bidding system, opening bidding up to the actual keywords used in online searches. Linking the advertisements to searches using keywords became top real-estate. What would have been a huge step forward for online marketing, was hampered by the 2000 dot com crash, taken out like a hit from a Rocky left hook. But that’s when Google stepped into the ring.

In 2000, following the fall of so many online marketing companies, Google released its own advertising tool: AdWords. Originally, AdWords used a flat CPM (Cost Per Mille, or thousand impressions) system when the Google platform was already booming. In 2001, in efforts to combat the growing dragon that was Google, Goto.com, Yahoo, and MSN joined forces and were syndicated into a new conglomerate called Overture Services. By the end of the year Overture Services was reported at making $288 million via their PPC campaigns, while Google was still running a solo race, falling behind with their CPM model, coming it at only $84 million.

However, Google was quick to learn, and by 2002 introduced their own PPC bidding system incorporating their own “Quality Score” to select advertisers for their top spots. They followed the PPC introduction with the acquisition of Applied Semantics and the release of AdSense. This new Google tool allowed online publishers to create PPC advertising geared towards the host website’s content as well as the audience, with the publishers receiving a percentage from each click generated. By 2005, only three years after launching their first PPC campaign, Google AdSense was listed at $799 million. That same year Google Analytics was released, and within months, Microsoft, which relied on Overture Services for their online advertising, dropped it and created AdCenter as a way to compete with Google AdSense and Google Analytics.

Google Analytics was a huge step forward for PPC marketing, enabling advertisers to more accurately trace the efficiency of their different bidding spots and content. With the growing use of search engines and the development of social media like Facebook, Search Engine Optimization was becoming the new frontier. Microsoft teamed up with Facebook to develop AdCenter, while Google focused on new markets and teamed up with YouTube to open up new platforms for advertisers (oh, better were the days when there was no “skip this ad” button on YouTube). With the diversification of different platforms, the content marketing and PPC battlefield became interlaced with niches and foxholes, when the rules of the game changed to require more nuance and finesse.

This transformation manifested itself in the form of more targeted marketing campaigns. Facebook began directing ads to users’ profile pages based on demographics and interests. LinkedIn was now also in the PPC game, and launched DirectAds that directed advertisers’ content to users via interest, demographic, employment field and job search keywords. Google also was improving its Quality Score to include different factors like click-through rate, relevance and landing page quality (though bid prices were still a thing). Basically, the better your content is, the less you pay for your spot.

To further improve efficiency and optimize conversion rate, Fetchback and Criteo both introduced “remarketing,” allowing advertisers to specifically target users who had been to their website before.  This being 2008, however, a year after the release of the first iPhone, the game was about to change all over again.

By 2009, the mobile sector of content marketing having grown exponentially, and PPC campaigns were now eager to team up with Google and other iPhone based platforms (powerhouse duo of the year: Google and YouTube). Google acquired AdMob, a mobile advertising company geared towards accessing the new niche markets and usage platforms for SEO purposes. In 2010, in an attempt to compete with Google,  Microsoft launched Bing search engine when Google revealed its new remarketing campaign as well as Product Listing bid placements all in the same year. By this point Google was reporting $50 billion in advertising, totalling 95% of its profit in 2012.

By this point most of the tricks of the game had spread through the proper channels and PPC campaigns were becoming more and more popular for all market segments. The evolution of phone based social media like Twitter and Snapchat had significant impact on the PPC market, as short list video ads resurfaced on more than just YouTube, functioning as #hashtags on Twitter and new video snaps, videos, and channels on Snapchat. In the last year, many different media platforms have taken after Google and their “enhanced campaigns” (advertisements that can’t be closed or skipped - another shout out to YouTube) and started placing small but high-quality content ads within their normal functions. However, these ads do not function on a PPC basis. The latest addition to the PPC marketing game is Dynamic Remarketing, which not only follows the normal remarketing strategies of targeting returning customers, but also allows advertisers to link both old and new products and content to the user on different sites, not just the same link for the same landing page.

From its inception back in 1996, we have traced the history of PPC ad campaign development and diversification. There are problems looming in the future for PPC. Problems that content marketers are desperate to be the first to solve - as everyone knows the frontrunner has the opportunity to stand out on top with any new advertising platform. Quality content and search engine optimization aren’t enough these days, as advertisers struggle to stay within their budget. The future of PPC is no doubt in store for another big change.

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So why the history lesson on PPC advertising? Simple. You have to know where you came from to know where you’re going. Since its advent in 1996, PPC advertising has grown in direct relation to the growth of search engines. However, with the mobile sector growing as rapidly as it is, advertisers need to shift away from more SEO related campaigns to more nuanced forms of marketing that account for smaller niche markets and more mobile modes of online interaction. With the PPC bidding market being steadily flooded by the overcrowded online marketing community (prices that started as low as $.005 back in 1996 are now going for $54.90 per click!), the online marketing game is not so much about the top spot anymore as it is about the efficiency of the conversion rate. These days, it’s what you do with the spot you have that matters. So what’s next?

CRO!    CRO!    CRO!

Like any advertising business, PPC campaigns are not just about grasping the top spot on the most used search engine. It’s about the conversion rate of that advertisement and those clicks turning into orders. Even with the number one spot on Google for ten different over-used keyword searches, if your content is poor and you’re aimed at the wrong audience, your CRO is going to plummet. And content marketing is all about optimizing opportunity. The best way to create opportunity, as my father the businessman has always told me, is to solve a current problem.

There are currently three main problems in the PPC realm that need addressing, and as always a myriad of contextually diverse answers. But one thing is certain: the first to solve one owns the lead position in the new market they discover...or create.

1. 
   Currently, PPC is staring down the barrel of the overflowing and oversaturated bid market that it itself has produced. With far too many competitors vying for the top spot, the prices have necessarily increased, and the per click value of these “preferred listing” ad spots is rapidly becoming NOT worth the cost. Content marketers are instead looking towards the other nuances of the PPC field to maximize their conversion rate optimization (CRO) by other means. This means more streamlined and creative content. It means more targeted advertising toward diversified markets. And lastly, it means diversifying their PPC budget over multiple SEO and social media platforms.
2. 
   CRO is also becoming a problem for companies that do not perceive themselves to be part of the retail market. While PPC ads are vital for retail businesses that rely on first click ads and dynamic remarketing to get orders, the conversion is harder to track when companies are selling a brand or service instead of quantifiable unit orders. In response to this binary, many companies are investing in the higher prices of PPC bids and taking a hit. This seems backwards doesn’t it? Paying up to $50 per click and reducing gross margin seems like shooting yourself in the foot. However, these non-retail businesses are looking at PPC as investment in brand building and are willing to reduce margins to establish brand identity and build brand awareness that can be further developed in the future.
3. 
   The last problem may be vague, but solving it may be one of the best ways to get ahead in the PPC marketing game! And that is the keyword searches themselves. SEO is all about maximizing the search engine keywords, then getting the most clicks and re-clicks out of those keywords at the lowest possible bid. However, the most popular keywords in any category are not necessarily the most productive. Not only is the oversaturated bid market hiking up ad prices and threatening a bleak bottom line, but the keyword search game itself relies on the top three to eight terms within a category that generate the most connections to different sites and landing pages. That being said, the users inputting these searches are not always going to find your content relevant to their search. This will lead to lower CRO as well as an increase in one-time clicks. Instead, consider investing in the long tail of keyword searches. Think of it as Keyword Search Optimization. KSO relies on the finer, more specific searches that today’s informed user is often typing into the search bar. Going after long tail KSO instead of the top five search terms can be cost effective, while also accessing finer niche markets, rife with loyal returning artisan customers.

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Like I said earlier, the PPC game is due for a big change and it seems to be coming on fast. The more efficient search engines become, the more pervasive social media creeps, and the more saturated the online advertising market becomes, the game will no longer be about who has the top spot. It’s all about optimizing. Stop wasting your time bidding for the top spot, and get going on the hunt for niche markets that will shoot CRO through the roof! As Bill Gates said himself: “The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.”