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GOOGLE AdWords Tip: Focus on ROI and not CTR!">GOOGLE AdWords Tip: Focus on ROI and not CTR!

July 26th, 2006 by Mike Reining Read more about Articles, Google AdWords, Pay per click advertising

Whatch your Google ROI — Case study: How we boosted ROI by 331% with bet­ter ad copy

Most Google AdWords adver­tis­ers focus most of their time on increas­ing the CTR (click-through-rate) of their Google pay-per-click ads. There is noth­ing wrong with that and we highly rec­om­mend that you do the same. How­ever, just gett­ting more peo­ple to click on your ad is not every­thing and could be the down­fall of your PPC campaign.

The key to a suc­cess­ful AdWords cam­paign is to focus on both the click-through-rate and the con­ver­sion rate of each Ad Group. After all, you are buy­ing clicks to con­vert your vis­i­tors into leads or buy­ers. The lit­tle know secret is that two ads in the same Ad Group might achieve roughly the same click-through-rate but could have a huge dif­fer­ence the con­ver­sion rate.

Case study: We were buy­ing a group of “med­i­ta­tion” key­words and wanted to keep improv­ing our ad copy to keep boost­ing our CTR. After try­ing lots of dif­fer­ent ads we were able to set­tle in at about a 1% click-through-rate, which is not bad given that we were not pay­ing for the top posi­tion and buy­ing lots of generic key­words. How­ever, what amazed us is that one of our ads ad a 9.8% con­ver­sion rate while the other ad for the same ad group was con­vert­ing at 33%!

The most wanted response of the des­ti­na­tion site was to con­vert vis­i­tors into leads by get­ting them to sign up for a free offer (a free med­i­ta­tion course deliv­ered via email). What was stun­ning is that we had two ads with sim­i­lar click-through-rates but a HUGE dif­fer­ence in sign-ups for the ads. Here are the two ads that we ran.

The win­ning ad:

google_ppc_ROI_1.jpg

The loos­ing ad:

google_ppc_ROI_2.jpg

By look­ing at the above two ads, you might come up with lots of guesses why one ad would get a higher click-through-rate and sign-up rate. How­ever, what is counter intu­itive is that one ad might would get a sim­i­lar CTR and yet have a con­ver­sion rate that is dra­mat­i­cally higher which results in boost­ing the ROI of the cam­paign by over 300%!

So the key les­son is to start opti­miz­ing and tweak­ing your ads for ROI. After all, you goal should not be to max­i­mize your click-through-rate but to max­i­mize profits.

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About the Author

Mike Reining Prior to MindValley Media, Mike was the Head of New Ventures Strategy at eBay where he conceived of the strategies that led to the investment in Craigslist, the launch of Kijiji.com and the acquisition of Skype. Mike has an MBA from Stanford and previously worked for the Boston Consulting Group. He is also a certified Google AdWords Professional.

Check out other posts by Mike Reining

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