Beware the Beginning PPC Search Marketer

The beginner marketer is very much still out there, managing millions of dollars worth of PPC (define) search spending. If that doesn’t scare you, it should.

It’s been a decade since paid search started gaining traction with the founding of GoTo started with just a few thousand marketers, not the hundreds of thousands that are participating in Yahoo Search, Google, and Microsoft today. For those of us who were among those first thousand to delve into PPC search, it’s difficult to imagine not having lived through search’s evolution.

In PPC search’s early days, even beginners could run killer campaigns. It wasn’t beginners’ luck; average bid prices were under $0.15 per click. Even an unskilled marketer with limited experience could do incredibly well. This obscenely high ROI (define) helped propel search to where it is today: an industry spending close to $20 billion this year.

Shar VanBoskirk at Forrester shared an interesting statistic from the firm’s Wave study: “In our ‘Q1 2007 Marketing Benchmark Online Survey,’ we uncovered that most marketers categorize themselves as ‘advanced beginners’ with search. Sixty-one percent still manage their search efforts internally with little or no tools, and almost 65 percent buy fewer than 500 keywords.”

While shocking, this data is somewhat consistent with SEMPO’s “2006 State of Search Engine Marketing Survey,” which reports that “over half of advertiser respondents said they plan to manage all of their 2007 paid placement spending in-house; larger firms were more likely to outsource more of their campaign budgets.” It also states that “the majority of advertisers (60 percent) began using paid placement within the last three years.”

Whether you were active in 1998 using the GoTo DirecTraffic Center (DTC) and making manual bid changes to avoid bid gaps or you joined SEM (define) more recently, you probably compete with one or more of these beginners for at least some of your keywords.

You have to adjust your campaign strategies to take beginners into account. I’m fond of reminding conference audiences that there are two kinds of marketers at the top of the PPC search results: brilliant marketers and total lunatics. Based on the number of beginners out there, perhaps I should also include a group that behaves like lunatics only because they’re clueless. They lack experience and training and are perhaps exposed to misinformation.

Regardless of whether you compete with a brilliant marketer, lunatic, or beginner in the PPC SERPs (define), you must devise a strategy to deal with them. If you aren’t sure what kind of competitors you’re up against, you can test the competition based on their responses to your actions in several ways.

More sophisticated PPC marketers tend to keep the reserve price (bid) on keywords fairly close to what it needs to be to maintain a position range (or possibly the number one position). They don’t tend to telegraph their true reserve price. An elasticity test on a keyword, ad group, or campaign will often help you determine a competitor’s and whether he uses API (define) driven technology to manage bids.

To deal with the beginners, think back to when you first managed campaigns. Beginners often make the same mistakes. Here are some of them; they may look familiar:

  • Managing campaigns emotionally to maintain top position, regardless of cost
  • Setting budget caps for campaigns instead of picking the optimal price/ROI combinations given budget constraints
  • Running the same creative across large keyword groups (often because an ad group is overloaded with a diverse set of keywords)
  • Using the home page as the landing page for the vast majority of keywords.

All search marketers can implement strategies that reduce the impact of beginners and lunatics. By learning best practices and implementing them (especially regarding click segmentation), you have the tools to reduce the maelstrom of the keyword auctions to a manageable campaign with a balance of profitability and scalability.

I’ve covered many of the best practices in my columns since I had the privilege of joining ClickZ in 2002. In addition, the number of conferences, courses, books, and online training resources has grown dramatically over the last year. Not all are comprehensive, but all make an effort to further learning. A few pearls of wisdom can make a huge difference.

I plan to cover SEM training and certification options in the near future. If you’ve had a positive or negative experience with a training resource, I’d like to hear about it.

Join us for Search Engine Strategies on June 12-13 in Toronto.

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