Blog: Tag: Click Thru Ratio
As a great soccer player’s wife once said, “So tell me what you want, what you really really want.” She wasn’t talking about paid search bid optimization but marketers should consider, do you want impressions, clicks, leads, sales, revenue, or profit? For some advertisers, any of those will do because their costs per impression, click, lead, sale, unit of revenue, and unit of profit are about the same regardless of their ad spend. That is, each dollar of advertising generates about the same number of impressions, clicks, leads, sales, revenue, and profit regardless of how many dollars they spend (when properly optimized with an application like OptiMine’s). For many advertisers though, this isn’t the case and they must pick what they really really want. Here’s a case in point from retail financial services. For this advertiser, keywords, and competitors, cost per lead is about $33 regardless of how much they spend. Each incremental $33 of spend gets another lead. However cost per sale is about $150 when spending $20,000 a day but $300 when spending $40,000 a day. To understand this, consider a real example from the credit card business a few years ago, before the credit crunch. Back then, if you bid on the paid search phrase “credit cards for people with bad credit,” then you would get a lot of applications (leads). However, you got few sales (new accounts) since the people who search on that phrase rarely had their application approved, thus driving up the cost per sale.
The obvious answer to the question posed in the headline is: Yes. After all, the ad in the top position is more likely to be clicked and, therefore, drive more business in the direction of the company holding the coveted spot. To reinforce that notion, Scott Smigler contributed an article to the practical ecommerce comparing top position click thru and conversion rates with those of side ads.
There is nothing easy about achieving success in paid search. Each campaign is filled with several moving parts, each of which is made up of sub-parts that are also on the move. For every part and sub-part there is a list of best practices - often called optimization - to guide you. There's ad text optimization, keyword bid optimization and landing page optimization, to name a few. A recent post in the Eloqua blog focused on the latter. The 11 tips offered by Eloqua's Jesse Noyes, are by no means comprehensive, but if comprehensive is what you want, a book is what you'll need.