Search engine advertising MBA 563 WEEK 5

Today’s class will cover: Search Engine Advertising: Methods of pay- per-click contextual advertising used in search engines How to set up a Google AdWords campaign Display advertising Demographic and behavioural targeting ‘Native” advertising

Search engine marketing recap – distinguishing the two elements Search engine optimization – managing organic search engine placement by optimizing html pages and devising an inbound link strategy (covered last class) Search engine advertising (Pay-per-Click) – Paying the search engines to get the results you want (TODAY’S CLASS)

Paid listings Organic listings

Paid search versus SEO Paid search Results can be seen immediately through increased traffic. But : no spending = no results Greater control over which keywords are most associated with their company, brands, products or services. Additional metrics are available, which means more detailed Web analytics that yield sophisticated knowledge from the data. SEO Results are gradual – can take months But the results can persist – maintaining position over time Searchers find it more acceptable than advertising Can be complex and may require external expertise One process – many results (tends to bring results across many search engines, not just one) DO BOTH!

Internet advertising formats (IAB report for 2014)IAB report for 2014

Why is search engine advertising still so popular with marketers? Search engines allow marketers to bid on specific key words that trigger an ad when a user types those words into the search engine Bought on a Pay-per-Click basis (no click, no payment) – performance model means easy measurement of success Less consumer resistance that other forms of advertising – people are actually looking for those goods or services(but remember that CTR still quite low – about 2%) Print directory versus search advertising for SME? – Effectiveness can be directly measured – Speed of execution and “tweaking” of advertising copy – Speed of consumer response – Usually more cost-effective

Search engine advertising Position is purchased as part of an advertising campaign - guarantees instant visibility While SEO and PPC advertising are separate techniques, a well optimized page with good content will also influence the placement of a PPC ad (via Quality Score) The website owner has control over: – Position in search results (BUT not always complete control – depends on AdRank/Quality Score in Google) – Keyword choice – Ad listing copy – Landing page – Geo-targeting – Daily budget and maximum cost-per-click

How is the ranking decided in practice? Google uses a combination of the bid price or cost per click (CPC) and the ad relevancy or click-through rate (CTR) and the Quality Score of the landing page – CPC x CTR = Google AdRank – Advertiser sets the maximum CPC per day – If an ad with a lower bid per click gets clicked more often, it will rank higher. – Result - CPC can decrease as an ad becomes more popular, even though a competitor may be prepared to bid more on the same keyword: more clicks = more money for Google. – Ranking can be improved by: Increasing the set daily CPC Trying to improve relevancy (and therefore CTR) – How? … Tweak the ad text AdWords Video: Understanding Ad Rank and Quality ScoreUnderstanding Ad Rank Quality Score

Keywords / key phrases Just as in SEO it is all about what people are actually typing into search engines Create a list of keywords / phrases just as you do for SEO – The big difference is that for search advertising you can target as many as your budget will allow – Research the advertising that your keywords actually trigger – Get sophisticated (think long-tail key words and phrases as in SEO)

Elements of an AdWords campaign Google AdWords “Campaign” – Each campaign is made up of one or more AdGroups – each relating to a separate “theme”, product group, marketing campaign etc – An AdGroup consists of a set of keywords, bids, and individual advertisements that are managed together

The elements of a basic text-based search engine advertisement Headline (25 characters max) Click to go to destination landing page Display URL (35 characters max) not clickable Description: Two lines of text (35 characters per line max) Include a call to action What makes up a text ad? (Google)

Think about your ads…. Better ad text, better performance – some tips on writing better Adwords advertisements Better ad text, better performance

Language and Geo-targeting Very cost-effective and highly targeting method of using search engine marketing – cost-per-click will vary according to the geographic target Especially useful for: – Small businesses whose target markets are in particular local areas – Bricks and mortar businesses Allows you to target your advertisement to – Particular geographic locations – Particular languages Geo-targeting - Bob Nicholson (4 minutes) Geo-targeting - Bob Nicholson

Setting goals for an Adwords campaign Before you begin to create an Adwords group you need to set goals and metrics (performance indicators so you know you have succeeded) Adwords Video: Define Success, then Achieve itDefine Success, then Achieve it

Advertising metrics: ROI and CPA ROI = Return on investment CPC = Cost per click (for performance-based search ads) CPM = Cost per thousand (impression) – for display ads CPA = Cost per (customer) acquisition Google Analytics and AdWords are very strongly tied together

Keyword targeted advertisements also served to sites other than the search engine itself The keyword-targeted advertisements appear not just in the search engine results pages, but on the “content network” Major players in PPC search engine advertising – Google works with an affiliate networkworks with an affiliate network Google search engine Google maps Mobile devices Content partner network AdSense publisher network Google Adwords Advertising types – don’t forget that Google offers Display ads as well as PPC ads Google Adwords Advertising types

Advertising for web publishers Google AdWords – for marketers Google AdSense – for publishers – Google’s content network - % of CPC paid – Ads are matched to page content, not search terms – – Different ad formats available, including video ads – Publishers can choose between PPC ads and Display ads How AdSense works

Click fraud PPC lends itself to click fraud because of its structure – Advertiser pays the advertising network, which in turn pays the publisher Click fraud = clicking on a paid advertisement for a fraudulent or non-legitimate purpose – By a human, an automated script or a computer program – an example an example The advertiser pays, the search engine company can be said to benefit (apart from paying out a % to the publisher)

Why click fraud? Two main types of click fraud: – Search engine click fraud: artificially raising a competitor’s marketing costs or exhausting their budget to remove them from their position in the listings (usually on very high cost or competitive key terms) – Publisher click fraud: artificially raising a publisher’s income from AdSense Estimated 10% to 15% of ad clicks are fake, representing roughly $1 billion in annual billings (Business Week, 2006).Business Week, 2006). Search firms have put tools in place to detect and prevent click fraud (but have still been sued by advertisers) Ad Traffic Quality Resource Center (Google)Ad Traffic Quality Resource Center Mobile clicks made in error are now an increasing problem (fat finger syndrome) Click fraud is now a social media problemsocial media problem

Advertising using other firms brand names as keywords It used to be that if you typed in Harvard Business Review you got Adwords advertising for McKinsey Quarterly Type in Molson beer and you get an ad for Budweiser “Tofino hotel” sometimes gets you ads for Ucluelet hotels Legal in the US and Canada? Ethical? – Google Trademark Complaint process Google Trademark Complaint process

Hands on practice Explore Google AdWords, research a PPC keyword campaign, and get some practice in designing text advertisements Video on How to Use the Keyword PlannerHow to Use the Keyword Planner AdWords Home Google Adwords: How to create a campaign, set up ad groups, and types of advertisements Google Adwords: How to create a campaign, set up ad groups, and types of advertisements

DISPLAY ADVERTISING

Definition of display advertising "a form of online advertising where an advertiser's message is shown on a destination web page, generally set off in a box at the top or bottom or to one side of the content of the page." The Internet Advertising Bureau (IAB) “Interactive” display advertising means that the display ads actually do something in response to a user action Display advertising is usually purchased on the basis of the number of “impressions” (CPM) that an ad has (not on the basis of performance or CTR)

Internet advertising formats (IAB report for 2014)IAB report for 2014

Web site advertising formats Display ads began in 1994 with static banners on Hotwired.com for AT&T Then in the search to catch people’s attention added animation, then moved to the use of “rich media” Interactive formats, including: – Banners – Buttons – Skyscrapers – Pop-ups, pop-unders, interstitials – Pre-rolls – Video – For examples of web advertising formats, go to DoubleClick Media Gallery IAB Guidelines for interactive advertisingGuidelines for interactive advertising

How are ads bought and sold? Shift from Ad Exchanges to “Programmatic Advertising” “Programmatic” ad buying typically refers to the use of software to purchase digital advertising, as opposed to the traditional process that involves RFPs, human negotiations and manual insertion orders. It’s using machines to buy ads, basically.” DigidayDigiday 200 milliseconds: The life of a programmatic real time bidding (RTB) ad impression (Media Crossing) 200 milliseconds: The life of a programmatic real time bidding (RTB) ad impression The Evolution of Online Display Advertising (3 minute video from IAB) The Evolution of Online Display Advertising

Problems with web advertising Seen as more intrusive - consumers complain more about web advertising than about other forms of advertising – Related to the nature of the medium Pop-up blockers and Ad Blockers Spyware and tracking cookies Privacy concerns – Social networking sites – Behavioural targeting and retargeting – may be subject to regulation Behavioural targeting and retargeting – Use of cookies by advertising networks Opting out – Network Advertising InitiativeNetwork Advertising Initiative DoubleClick Opt-Out Do Not Track initiatives Very low click-through rates…..

How successful is online display advertising? Click-through rates are very low – Average is around 1 click every 1000 impressions – Research from Dave Chaffey on variance in CTR for display ad typesvariance in CTR for display ad types – Click-through rates on Facebook and Twitter (from Larry Kim) Click-through rates on Facebook and Twitter Beyond demographics : Behavioural targeting and re-targeting are being tried in an effort to improve CTR

Final thoughts about web display advertising…… Advertising is less and less about interruption and trying to grab attention More and more about attempting to engage a willing audience Big shift to the use of mobile by users so advertisers are following Advertisers cautiously shifting to paid social media – useful survey from Neilsen (2013)useful survey from Neilsen (2013)

Integrated campaigns Campaigns that use a variety of marketing tactics that work together in a campaign (just like your team project campaign) MIXX Awards 2014 – a variety of interactive advertising featured as part of integrated campaigns (get some ideas for your team assignment campaign from here!) MIXX Awards 2014

“NATIVE” ADVERTISING

“Native” advertising Also known as “content marketing” – basically it is paid content (marketing messages) masquerading as organic content on news and other publishing websites (Buzzfeed is often named as the primary example) – it differs from the traditional “advertorial” because it is designed to blend in with the “real” contentBuzzfeed Increased use of native advertising is a response to the fact that traditional display ads don’t work at all well – but it is very controversial Native Advertising Examples: 5 of the Best (and Worst) Last Week Tonight with John Oliver: Native Advertising (HBO) (11 minutes) Last Week Tonight with John Oliver: Native Advertising