Alternate Title: How I doubled Return on Ad Spend in branded PPC
PPC 101 – Branded Search
The first rule of PPC is to make sure you bid on your branded search terms. Actually, scratch that – the first rule of PPC is that all must bow down to Earth’s future overlords, Google. Or was that “Alphabet”? But! After that, bidding on branded search terms is top of the list. The logic is crazy simple: you don’t want competitors bidding on your brand name, and showing ads for their products before yours.
Better still, running a branded search campaign in your Google AdWords account is easy, right? You happily add in all the variations of your brand’s name as keywords, create some on-message text ads, sprinkle in a few sitelinks, and you’re good to go. And, by virtue of Quality Scores in AdWords, you should be paying a heck of a lot less per click than any competitor trying to go after your brand name or keywords.
Signed, sealed, delivered, done. It’s one of the most straight-forward PPC strategies.
Seems like the ultimate in low-hanging (high ROI) fruit, so you’d want to shovel in as much cash as possible to ensure you’re getting it all. Impressions, clicks, leads, revenue… Right?
A fool and his PPC budget are soon parted
No. It’s not that simple? What if I told you that you could actually be hurting yourself by throwing huge budgets at this type of campaign? Would you believe me?
I’ll prove it.
One of the most common mistakes advertisers make in any branded search campaign is to set high maximum CPC bids. They assume that their actual average CPC will turn out far lower at the end of the day. The logic behind the high ceiling on bids is that you want to be in that coveted #1 ad spot for all searches of your own brand name 24/7/365. The high bid leaves nothing to chance. For example, a business might bid $10 for their brand name in “exact match” knowing that the avg. CPC will realistically end up around $2. To many, that’s worth it, so long as you always dominate position #1.
But this tactic may artificially and unnecessarily increase your own click costs. You’re throwing money away.
I saw this first-hand with a client’s account. The client set their maximum CPC on branded keywords far higher than the existing top bid. I suspected Google AdWords was exploiting that and costing my client a lot of money..
I wanted to know if I could lower my bids significantly on these keywords, lower my avg. CPC, and maximize ROAS without losing out on impression share or avg. ad position.
Could I still get dominant placement on searches for the company’s brand for far less money?
How I doubled ROAS on branded search
Over the course of 12 months, I lowered nearly every branded keyword bid 50% – 75% or more. The year-over-year results were flat-out stunning:
Nearly every key metric improved after making these bid changes. The only one which decreased was the click total. Lower year over year search volume drove that.
The biggest impact can be seen in the bottom two rows: profit from branded search keywords increased 24% while ROAS increased 159%. I’d call that a clear test result.
The bottom line
Don’t set ridiculously high maximum bids in your branded campaigns. That’s not how you succeed. Think about your priorities. If you want high ROAS, avoid that bid strategy. Sure, setting high maximum bids may help you sleep at night. They guarantee you’ll always have that number one spot for your brand. But that tactic costs you a fortune.. If you care about ROAS, avoid set-it-and-forget-it PPC strategies. Treat your branded keywords like any other AdWords campaign. Manage wisely!
Wow, perfect timing Ryan! I’ve been meaning to address our own branded term campaign as it’s begun to get VERY expensive. We’ve done exactly what you described. Really high max CPCs. Thanks for this!
How much of that traffic would you have gotten for free with the #1 organic spot for branded searches?
Impossible to know for sure. In our experience at Portent, users are more likely to click through when you have both an organic and a paid listing showing up for branded searches, versus just having an organic listing alone. Some sites have great brand awareness and don’t necessarily need paid listings for their branded terms to meet their bottom line goals, but there’s a risk of losing out on visitor volume if you don’t have that coverage for PPC.
This is as much about self-defense as clicks. If you don’t buy that spot, competitors will.
I totally agree with this article. It’s vitally important to monitor brand traffic on PPC.
In terms of management I focus on getting the quality score as high as possible through keyword insertion and relevant ad copy. The landing page relevancy part should take care of itself given its your brand. After that careful monitoring/adjusting of avg. CPCs is required as well as managing daily/monthly budgets.
One more point to add is, its always important after brand campaigns have been running, to analyse whether this has taken away traffic you’d be getting from organic traffic. At the same time, you can tell some companies they are paying for traffic they’d be getting but they are obsessed with stopping competitors bidding on their brand so they are willing to pay.
I agree completely with that article. Monitoring mark traffic on PPC is vitally necessary.
As regards management, I concentrate on making the quality score as high as possible through the insertion of keywords and the appropriate ad copy. Given its name, the landing page relevance aspect should take care of itself. After the careful surveillance / adjustment of avg. CPCs are provided, and daily / monthly budgets are handled.
Another thing to add is that it’s always necessary to evaluate how this has taken away traffic you ‘d get from organic traffic after brand promotions have been running. At the same time, you can tell certain businesses that they are paying for traffic they will get because they are concerned with keeping rivals from bidding on their brand so they are able to pay.