Most AdWords accounts are not set up to maximize results for the advertiser. Of the dozens and possibly hundreds I have personally evaluated, most could be quickly and easily optimized to decrease spending and greatly increase traffic and revenue by following the strategies laid out below.

NOTE: Be sure to also check out these two highly recommended posts:

• You Missed the Golden Days of Internet Pay Per Click Advertising for specific AdWords issues to be avoided
• AimClear Search Marketing’s 6 minute audit for evaluating the performance of your AdWords account

ADWORDS OPTIMIZATION OBJECTIVES:

• Maximize Traffic
• Minimize Cost Per Click (CPC)
• Increase Click Through Rate (CTR)
• Maximize Return on Investment (ROI)

EVALUATION and SETTINGS at CAMPAIGN LEVEL:

1. RECOMMENDED BUDGET:  Ensure the Daily Budget is sufficient to buy all available quality traffic by using Google’s Recommended Budget Function so your ads will show as consistently as possible. If you wish to limit spending it is better to selectively pause some Ad Groups so that ads for your most important keywords display consistently. Many potential buyers will look for you the same way they originally found you when they’re ready to buy. If they can not find your ad you may lose their business. [WARNING: Raising or setting your budget significantly higher than necessary can result in increased spending and VERY POOR QUALITY traffic! Keep your budgets just high enough to prevent your ads from being limited.]
2. BUDGET DELIVERY METHOD: Standard or Accelerated? I recommend always setting it to Accelerated to ensure your ads are running consistently and the recommended budget is adequate.
3. BUDGET OPTIMIZER: It is not advisable to use budgeting functions to limit spending because they cause ads to appear inconsistently.
4. AD SCHEDULING: Not recommended. Best results are obtained by having ads running consistently. Your buyers use the Internet 24×7 and your ads should run all the time. The only exception is for a business that only sells live via telephone during their business hours – and if you are doing that you really need a better business model and improved Web site.
5. POSITION PREFERENCE: This function did not work as advertised the last time I tested it. IF it works now it would be worth using. Testing to verify that would be necessary.
6. AD SERVING: Optimize or Rotate. It is best to leave this set to optimize except when testing new ads or landing pages.
7. SEARCH NETWORKS: I recommend running ads on the search network and NOT the content network (more detail below). You can run your ads on Google.com only or on Google.com and the Google Search Partners Network. You can not choose to run them on the search partner sites unless you run them at Google.com. While logically one would think that Google search would convert best, I have tested and found that often the search partner network converts better. Unfortunately you can not usually opt out of poor quality search partners so you either accept all qualities or get none of them.
8. CONTENT NETWORK / CONTENT BIDS: Content ads almost always convert far less than search ads because someone specifically looking for something is more likely to take action soon than someone clicking out of curiosity. For most advertisers, I advise only considering content or display ads if they are already buying ALL available SEARCH trtaffic. The exception can be carefully targeted ads on hand-chosen content sites with the results tested. Content can occassionally convert higher than search in some niches on some sites.
9. LANGUAGE: If your site is in English you would normally only run ads in English.
10. LOCATIONS: If you sell across your entire country select that country. If you ship outside your country location select those countries IF you meet the language requirements. If you sell regionally you should start with ads running in your desired location and then expand to running national ads with two types of Ad Groups: 1) that contain general keyword phrases and contain locations in the titles of the ads and 2) that use phrase or exact match keyword phrases that include locations.

AD GROUP SETTINGS:

1. BROAD, PHRASE or EXACT MATCH? Broad match keywords or phrases are entered without quotes or brackets around them. Those new to AdWords will often be using only broad match without realizing the danger. Phrase match keywords are within parenthesis: “phrase match keyword” and Exact match keywords are within brackets: [exact match keyword]. Exact match is the safest and should be used to test new keywords. Your ads will be displayed when that exact phrase without any other words is searched. Phrase match can be fairly safe if you use at least two words. Your ad will display for any searches that include that phrase in the exact word order plus any other words before or after it. Although broad match is responsible for sending at least half of sales and traffic in most accounts, it is now so broad that it can be dangerous to use. Before adding any broad match keywords ensure you have as many negative keywords as possible and watch carefully for high traffic and dismal conversions that indicate poor targeting of your ads.
2. KEYWORD SELECTION: The best keywords and keyword phrases are specific to what you are offering.  ALL keywords in an Ad Group should be similar and appear in the ads – preferably in the Title if they will fit – and on the selected landing page. DO NOT put unrelated keywords in the same Ad Group. Using separate Ad Groups for each set of similar keyword phrases works best; however, you must balance increased effectiveness with additional management from having hundreds or thousands of Ad Groups.
3. USE OF GENERAL KEYWORDS: Never use keywords that are so general that they are not specific to what you’re offering. They can be used as part of a phrase that DOES relate to what you advertise.
4. USE OF SPECIFIC KEYWORDS: Good use of specific keywords targeting specific products produces the highest conversion rate. Consider adding as many low volume, low cost keyword phrases (commonly referred to as “long-tail” keywords) as possible. Targeting additional specific products by brand, model, model number, color maximizes profits. [NOTE: Most keyword tools only show search phrases that have been used more than a set number of times in a month - usually 10-12. Logical choice of phrases that do not appear in these tools can generate sales especially for high dollar products.]
5. NEGATIVE KEYWORDS: Negative keywords are essential for targeting your ads and elminating clicks for products and services you do not offer. They lower your impressions for unrelated searches which increases CTRs which in turn can greatly lower your CPC. Both can reduce ad spend and increase ROI.  [WARNING: Running ppc advertising without thoroughly researching and adding negative keywords has been accurately referred to as financial suicide.]
6. NEGATIVE EMBEDDED KEYWORDS: These are exact match negative keywords used to block specific phrases from triggering your ads without blocking ads that use those words but not that exact phrase. See how to use Negative Embedded Keywords.
7. BID AMOUNTS: There is a tactical advantage in bidding odd amounts. Because most advertisers will end their bids in 0 or 5 and use similar amounts ($0.25, $0.50, $0.75, $1.00, $2, $5) you can easily move in front of many ads for only pennies per click. If more than one person manages your AdWords account each can choose a different odd number to end their bids. That way they know who last changed each bid.
8. BIDDING STRATEGY: For maximum traffic at minimum cost, select a target ad position range and adjust bids to display within that range. For most advertisers I recommend third to fifth position as providing the best Return on Investment (ROI) and fifth through eighth for maximum traffic at least cost. There are only rare exceptions that make bidding into first or second position necessary or advisable.
9. KEYWORD MATCH ADS: Make sure your Ads and ideally your Ad Titles match your keywords in each Ad Group. If they don’t they should be split out into additional Ad Groups running matching ads which use a landing page specifically optimized for that product.
10. ADD TESTING and EFFECTIVENESS: Review all ads and delete any with poor CTRs. Test additional new ads to improve CTR, increase traffic, lower CPC, and increase ROI.  [NOTE: For best results always leave one ad unchanged, add new ads, and then delete the existing ad later if desired. Deleting or editing the only existing ad can cause your ads to disappear temporarily. Google manually reviews new ads. Existing ads also have a historical advantage which is lost if they are edited or deleted. Editing ads in AdWords equals deleting and adding a new ad!]
11. URLS in ADS: Google allows the capitalization of words within URLs. Use this to make your domain name easier to read. For example, instead of http://growmap.com I would use http://GrowMap.com.
12. KEYWORD RESEARCH: Use keyword research tools and review your site logs to find new and negative keyword phrases to add.

Anyone buying Google advertising needs to understand all of the above to ensure they are not overspending – and this isn’t all you need to know. Really understanding AdWords can greatly increase your ROI. Although the systems are different, these concepts can also be applied to other pay per click search engines.

Some may not agree with all of my recommendations and they are welcome to leave comments if they do not. Remember that being Google Certified in AdWords means they passed training designed by Google to benefit Google.  I believe in managing AdWords accounts in the manner that most benefits the advertiser – not the search engine.

While I once made a living managing AdWords and other ppc accounts I have been away from doing it full time for a couple of years and systems do change. I believe all the above is still accurate and will ask other consultants who are still full-time AdWords consultants to review it and make suggestions.

Do also read my post You Missed the Golden Days of Internet Pay Per Click Advertising for specific AdWords issues to be avoided. We also recommend using AimClear Search Marketing’s 6 minute audit for evaluating the performance of your AdWords account. Even better, as my regular readers already know, I highly recommend attending this ppcSummit to greatly hone your skills and improve your ROI:

September 15, 2009 was the last day to get the 25% discount; however, the discount is still available as of today September 16, 2009.  They are the best so if what they teach does not agree with the above believe them – and let me know!

We have recently come across a brilliant PPC management company and highly recommend their blog posts:

• PPC: The Wrong Way to Improve Efficiency
• PPC: Holiday Bid Management Tips

September 15, 2009, is the new extended deadline to save 25% off the regular registration fee for attending the very best pay per click seminar available. Read Why I recommend ppcSummit to find out how you can grow your business using ppc advertising. Seminar covers Google AdWords, Yahoo! Search Marketing (or how to transition), Microsoft AdCenter,  and all the smaller ppc engines.

Find out what the best strategies are for growing your business with ppc without losing your shirt.

New seminars are scheduled regularly so even if you missed this deadline do read our review of ppcSummit and check for when and where they will be held next.

The deep discount for signing up for the very best pay per click seminar anywhere has been extended until September 1, 2009. If you want to get the most value from your ppc spend read the indepth ppcSummit review I recently wrote that explains why I highly recommend them.

The discount saves you 25% ($400) so if you’re ready to register just click on the banner below:

Upcoming ppcSummits:

• Los Angeles, CA – Sep 23-24, 2009
• Chicago, IL – Nov 4-5, 2009

The good news is that there is no faster way to increase traffic and drive major increases in sales than highly targeted Pay Per Click Advertising.  The bad news is if you don’t really know what you’re doing you can spend a small fortune and generate few or even no sales. Even if you feel you are already doing well with your ppc ads you can always increase your profits by continuing to improve your campaigns.

Sometimes you need to spend money to make money. This is one of those times. Pay per click and especially AdWords is so complex and changes so frequently that it is essential that you get expert advice. I made a very good living for several years and had exceptional results managing ppc accounts for a living. During that time a client paid for me to attend a seminar sponsored by Yahoo! Search Marketing. That is where I met the person I believe knows more about ppc advertising than anyone anywhere.

She now offers independent seminars – independent because she has always focused on how the ADVERTISER can get the most out of their ad spend – NOT the ppc search engine. Many who are AdWords certified are doing and recommending what Google advises, i.e., what is best for Google. Wouldn’t you really rather know what is best for YOU?

I am going to lay out why I believe you should attend ppcSummit. I hope you’re still reading because this is important.

HOW PPC SUMMIT BENEFITS YOU:

• Understandable even if you have never logged into a ppc account – yet the more you know they more you’ll learn.
• Absolutely accurate, current and VERY comprehensive information
• Everything you hear is also provided in print so you won’t miss a word – you won’t have to take notes – and every single thing you learn will go home with you in writing for future reference.

During my decades at IBM I attended over 200 formal schools covering hardware, software, marketing, negotiating – you name it. And I never attended any school that was as good or packed as much information into as little time as the seminar I attended created and delivered by the people behind ppcSummit.

I already knew more than most anyone else about ppc. I taught how to use it as a moderator of a major forum. I regularly let Yahoo and Google reps know when their systems had problems and how they worked. I was in a unique position to evaluate what was taught for accuracy and thoroughness.

Everything was 100% accurate and there was something else that impressed me. Mary answered every question – every single one – even those about other ppc engines (remember this was a Yahoo! Search Marketing seminar) – off the top of her head. She really knew ppc and she should. She was with Go-To when they originated the ppc advertising concept. When Go-To became Overture in 2001 she stayed on as Senior Director of Sales, responsible for the training & organizational development team where she hired and developed hundreds of sales, marketing and customer services associates.

In 2005, Overture became a wholly-owned subsidiary of Yahoo! called Yahoo! Search Marketing, about a year after Mary had left to start her own firm. Since she had developed the training materials still being used by Yahoo, Mary’s firm was hired to create and conduct the seminar I attended. Mary and I have stayed in touch over the years. We gave each other the heads up when we saw something new happening that could cost us or our clients.

What you need to know is this. Only those who have multiple accounts that are both very small and very large can really know what is going on. Any agency that only has huge accounts won’t see issues that you need to know about to protect your investment. Attending ppcSummit is an investment that will pay off in saved spending and increased revenue.

If you consider yourself a ppc expert I strongly and sincerely encourage you to attend! You will greatly increase your skills and the value you bring to your clients, your employer and your own projects.

Remember when I said I had “exceptional results”? Here are some examples:

• Took one business from $150,000 in revenue annually to $1.1 million in 8 mos.
• Increased daily sales from $4,000 to first $15,000 (after 4 hours of optimizing) and then $40,000 PER DAY
• Regularly doubled or even tripled traffic for the same ad spend whether that was $100/mo or $50,000+/mo

Now I am NOT saying this can be done for any business. The account that made $40,000 in sales per day was in the unique position of being in a niche with enormous demand and offered a unique benefit. What I am saying is that almost every business can greatly benefit from really knowing how to use ppc and this seminar is the best way there is to learn what you need to know.

I am so sure that you will benefit from this seminar that if you attend and you don’t see immediate benefits from applying what they teach you and you don’t know why just ask and I will personally log into your ppc account and advise you on how to improve it.

One more thing. If you register by August 1st you can save $400.

Once upon a time in the golden days of the Internet circa 2003, small businesses were prospering because of a brilliant new way to generate revenue called pay per click (ppc).

PPC was inexpensive and – once you had some level of skill at using it – would deliver targeted visitors willing to buy!

Businesses could quickly and almost easily prosper! The party didn’t last too long though.

Originally the traffic was VERY targeted and it converted well.

Both Overture and Google AdWords worked very well for small businesses. Then Yahoo! bought Overture and their new system immediately dropped the results advertisers had been getting from Overture. (As for Microsoft’s entry – it is not worth the time it would take to write about it.)

Google came out with an Expanded Broad Match – a change that makes advertising there extremely risky because their idea of a “match” is SOOOO expansive that it is dangerous to run anything but exact match keywords.

The mood of the ppc party had permanently changed for the worse.

Google has since added this Expanded Broad Keyword Matching page marked NEW! (note the changed phrase – this makes expanded broad match even broader) and sounds like what is described on their Automatic Matching page which indicates it was optional:

Opting in: Automatic matching won’t bring your campaign additional relevant traffic unless you opt in on the Campaign Settings page.

I do not see that option today so it appears that it is not possible to opt-out of these ever-expanding irrelevant ad impressions.

The only thing that MAY work is to ONLY use exact match.

The quality targeted traffic available from broad and phrase match has now been too diluted to be effective due to wildly unrelated search impressions and what PPC experts call Distribution Fraud: showing ads on MFA (Made for AdSense) parked domains and at the top of searches for videos, friends, and profiles at sites like MySpace.

As PPC Expert Richard Ball asks in his Apogee Weblog:

“How does Google explain the decision to detail clicks from individual domains on their pay per click advertising network but to hide the individual parked domains from advertisers?”

There is also Google-sponsored Fake Search Click Fraud – showing ads limited by the advertiser to search only on sites where NO search took place. These sites show your most expensive, targeted ad on generic searches thereby maximizing advertising spend and nearly eliminating the potential of closing any sales!

Spending spirals out of control and conversions dwindle or disappear altogether, resulting in HUGE jumps in advertising costs to make NO additional sales – or NO sales at all! is the worst possible scenario for a small business.

Finally there are artificial minimum bids that first appeared during critical sales periods such as the holidays and later became permanent. Google finally admitted that the placement auction wasn’t really an auction at all. Some don’t believe this is happening so the screen captures below are just for you.

Because NoBogies is a new site and I have extensive ppc experience we decided to see if we could manage to generate some highly targeted traffic without losing our collective shirts. They show the challenges of getting the keywords in one new ad group for golf gifts to display.

In case you can’t read this image clearly, the text says “Bid is below first page bid estimate of $x.xx” – In our case the amounts are from $0.70 to $1.25.  When you point your cursor at the Keyword Analysis Ads Diagnostic Tool (the little magnifying glass icon) for the keyword phrase gifts for golfers that does NOT have that “Bid is below first page bid estimate…” message you get this:

It doesn’t really matter much which error you get because in both cases your ad will not appear. So how many advertisers ARE willing to pay these artificially inflated “auction” prices? How many other advertisers are crowding our ad off that all-important first page? How many ads do you see in the image below?:

For those not familiar, Google ads appear above the regular organic listings on the left side of the page and/or on the right side where I have added the colored circles (above). Do you see all those ads that are outbidding us and pushing ours off the page? You can’t? That is because there are no ads there.

There are currently ads running for these particular keywords at this particular time; however, a page without ads is precisely what advertisers have seen during the critical holiday period. Ads that were appearing for minimal bids (anywhere between ten and seventy cents or slightly more) would suddenly refuse to run even when bids were raised to $20 a click! Then several days BEFORE the best holiday shipping ends (when you can still ship at the lowest rates) bids suddenly drop – all at once – and ads suddenly reappear!

What advertisers would be in there lowering their bids in the middle of their busiest season of the year? What advertiser would be lowering their bids when there are still 2-3 prime days of selling left in the season?

The only answer MUST be that GOOGLE dropped that artificial minimum back to normal.

This is ample indication that advertisers must immediately start diversifying. What percentage of your sales are dependent upon traffic from Google? How long could you operate if you suddenly dropped off the first page in the organic or paid search listings? One of my main reasons for working on affiliate programs is to find ways for small businesses to diversify.

The most interesting thing I learned today about AdWords is that our ads (which I have opted out of search partners and should therefore ONLY appear on Google.com) DO appear in searches done on my favorite search engine Zuula which pulls results from Google.com. Apparently they are NOT considered a search partner and are considered the same as Google which means analytics for ppc ads just got even more complicated.

Google hopes you’ll pony up whatever it takes to get your ads to show. Sometimes raising your bids will work; often it doesn’t. My advice when you run into this problem? Ignore those messages and let your new ads run for a while. They may get some impressions and sometimes they’ll even take off and run.

During the holidays do NOT automatically start increasing your bids. First determine what your break-even rate is and then only bid when your sales are still generating a profit. It is rarely wise to intentionally lose money on every sale because your advertising costs are higher than your profit margins! Even though you won’t see your usual holiday increase at least you won’t be digging a debt hole.

AdWords is now so volatile that some of the very best ppc consultants no longer accept client’s money to manage them because the risk is so great.

Anyone who spends more than a minimal amount or uses broad or phrase match has only one way to prevent losses: automate your account using an independent Web analytics package such as Lyris (formerly ClickTracks) feeding a Bid Management program in real time.

Their PPC Management solution might do that. To safely use AdWords you must be able to immediately clamp down on out-of-control spending – and that takes a computer. It is not humanly possible to control spending manually. ClickTracks is the only solution I know of that uses live Web analytics to control a bid management program.

If you know of any other combination analytics bid management solutions or have experience with Lyris / Click Tracks we would love to hear from you. Please add your input in our dofollow KeywordLuv CommentLuv comments.

What we are hoping to see is Social Networking ppc advertising – and the sooner the better.

History of PPC:

• GoTo to Overture to YSM – Timeline
  
• Semvironment: The History of Pay Per Click Advertising and Yahoo! Sponsored Search
  
• PPC Advertising – The History of Yahoo Search Marketing & Other PPC Services
  
• Google AdWords: A Brief History of Online Advertising Innovation
  
• Originator of the PPC Marketing Concept
  
• Introduction to Search Engine Marketing: History of PPC Advertising
  
• Pay-Per-Click Search Engine Marketing Handbook Review
  
• AdWords Landing Page Quality Score and the History of PPC Price Inflation
  

Google AdWords Issues:

• NEW: Are You Getting Killed? – What to read when you’re stressed out over what used to work (Jul 16, 2009)
• In Case You Missed It: Google’s PPC Fraud Settlement (Apr 6, 2009)
• Beware – Expanded Broad Match – Is Google Helping Advertisers? (Mar 2, 2009)
• AdWords Management: When to Just Say No to Google AdWords (Feb 18, 2009)
• Google Groups AdWords Help Archive: Broad Match Ethics (Oct 9, 2008)
• Match Type Strategies; Lessons Learned (Sep 3, 2008)
• Google AdWords; The Better You Get The Worse It Gets (Jul 15, 2008)
• Distribution Fraud is Google’s Miserable Failure (Mar 22, 2008)
• Stomp the Google AdWords Expanded Broad Match Problem (Jan 8, 2008)
• Google AdWords Broad Match; How to Combat Google’s Cash Grab (Nov 11, 2007)
• PBS: I, Cringely: The Next Microsoft: Google is Learning Too Well From The Master (Nov 2, 2007)
• New AdWords Matching Type Discovered: “The BOGUS Broad Match Type” (Oct 21, 2007)
• Expanded Broad Match Warning (Oct 15, 2007 – Jennifer Laycock – Search Engine Guide)
• Expanded Broad Match and the Google 1-2 Punch (Oct 14, 2007)
• Expanded Broad Match Goes Loco on Local (Aug 31, 2007)
• Prevent Click Fraud From Eating You Alive (Aug 22, 2007)
• Google’s Broad Match: Room for Improvement (Jun 28, 2007)
• Be Careful of Google AdWords Expanded Broad Match (Jun 19, 2007 – Christine Parfitt – AUS)
• Yahoo SERP Lists Google Group That Redirects to MFA Search Page (May 31, 2007)
• AdWords Flaw Could Cost Small Business Millions (Mar 28, 2007)
• Google: Screwing Advertisers Over Before Christmas (Nov 6, 2006)
• Are You Paying for Irrelevant Clicks Because of Google Expanded Broad Match? (date unknown)
• Why Can’t We Opt Out of Parked Domain Traffic?
  
• What is a Parked Domain? How They Can Affect An Advertiser’s ROI
  

PPC Management Tools:

• Lyris (formerly ClickTracks) on demand Webinars on PPC, ROI and Analytics
  
• Lyris PPC and Web Analytics Guides – once you submit your information you can access the PPC white paper)
• What is Impression Share Exact Match? Reporting Tool Provided by Google

We have recently come across a brilliant PPC management company and highly recommend their blog posts:

• PPC: The Wrong Way to Improve Efficiency
  
• PPC: Holiday Bid Management Tips
  

You can get free online advertising from some companies if you buy a small, inexpensive ad in their free printed editions. Pick up any free printed classifieds you see in your area. They are usually found in grocery stores, restaurants, and other local businesses.

Some you may wish to consider are:

• Thrifty Nickel Want Ads aka American Classifieds aka TNOL.com
• PennySaver Classifieds
• Backpage – Suggested by Matt the Wedding DJ from Sacramento Weddings
  

Some print classifieds place only classified ads on their Web sites (not display ads). If you buy a small ad in one print edition that ad can be searched for and seen by anyone online. This can make it an inexpensive way to get free online advertising and sometimes links too.  Offerings vary so be sure to read the fine print.

We are seeking out research others have done on the best classified sites and especially lists of classified ads by location. If you have any you would like included just leave us a comment or contact us at Twitter.