Yesterday saw the first part of our very own Christmas Trilogy – How to reduce your PPC costs (or “Only Fools and Horses part with too much PPC cash..”) Shane gave us a masterclass in reducing your expenditure by increasing your relevancy.  And today Shane hands the baton over to Dan Barker who looks at narrowing your campaigns to focus more intensely on those profitable keywords.

So.. “Previously on Affiliate Doctors..” Mike wanted to know “How to bring down the CPC for maximum profit or getting sales” and wanted to know if “something can be done even if the “Reverse Engineering” doesn’t work, or where you spend more than you earn, even if you have high QS (Quality Score)”

Over to you Dan..

Hi Mike, how are you?

I don’t know whether you’re using landing pages, sending clicks straight to merchants, and even whether you’re able to see which of your keywords are converting on merchants’ sites, so I will keep things simple & offer 2 simple tactics & one process to hopefully help you out.

TACTIC ONE: BE AS NARROW AS POSSIBLE

A very easy way to cut costs is to target everything as closely as you possibly can.

Move away from broad & phrase match & use exact match wherever possible.  For example, instead of targeting ‘Oak Beds’ with an ad group, split that down to ‘oak single beds’, ‘oak double beds’, ‘oak king size beds’, ‘oak bunk beds’.  Once you’ve done that for all of your products, take it a step further, splitting those down into one set targeting the same phrases with the word ‘cheap’ & one without, e.g. this might be a small selection of keywords from one group:

– [cheap oak single beds]
– [buy cheap oak single beds]
– [buy cheap oak single beds uk]
– [buy cheap oak single beds online]
– [buy cheap oak single beds online uk]

You could split that down even further still, for example by region – either by city in the adwords tool, or by city in the search string:

– [cheap oak single beds London]
– [buy cheap oak single beds London]
– [etc.]

In that instance you might have a line in the creative along the lines of ‘Free 24-Hour Delivery in London’.  A nice thing about this is you may find something is profitable in London but not in Manchester (for example).  Turn off areas where the terms are unprofitable & you save money.

And again, you can keep splitting your groups down & down to a really granular level, avoiding costly broader terms & allowing you to tweak them at a very low level.

TACTIC TWO: USE TONS & TONS OF NEGATIVE KEYWORDS

If you are using broad or phrase match ads, you will always show for a load of things you hadn’t thought of.  It’s important to use as many negative keywords as possible to avoid this as it can both A) lower your CTR by receiving impressions you don’t want and more importantly B) increase your costs by receiving clicks you don’t want.

To do this, I’d use some keyword research tools (e.g., your own internal stats, google keyword suggestions).  A super-simple example to illustrate this might be ‘Acer Laptops’.  A very small handful of negatives might be:

– ‘review’ (I don’t want people who are just researching, I only want people who are ready to buy)
– ‘broken’ (I don’t want people who are just problem solving)
– ‘bag’ (I’m selling laptops, not accessories)
– ‘toshiba’ (this catches people who are searching for comparisons between laptops)
– ‘cheap’ (unless I am actually selling cheap ones)

etc.

The easiest way to do this is to:

1. Use the Google Keyword Suggestion Tool
2. Put in your search term (and a few other similar terms)
3. Add anything that doesn’t match what you’re selling as a negative.

TACTIC THREE: COME UP WITH YOUR IDEAL ‘COST PER SALE’

The easiest way to cut PPC costs is to remove bits that aren’t working.  BUT it’s often difficult to draw the line between “doing ok” and “not working”.

Coming up with your ideal ‘cost per sale’ is a nice guide for this and it allows you to both grow your campaigns & trim the garbage at the same time.

Here’s the basic process:

1. Decide on an ‘ideal cost per sale’ for a particular merchant

For example, your average sale through a merchant is £15.  You decide “I’m happy to make £5 profit per sale with them” therefore your ideal cost per sale is £10.

2. Once a week/once a day (depending on how much time you have & how much you’re spending!) pull a report of all of your ad groups for that particular merchant.

3. Go down the list and, for any ad groups where you are spending more than £10 per sale, decide whether to ‘delete’ or ‘tweak’ them.

4. A ‘tweak’ might be either:

– Remove specific keywords converting at too high a price
– Swap vague keywords for narrower keyphrases
– Split broad adgroups into more targeted adgroups
– Bump bids down
– Add a new ad creative

If you add all of these 3 tips together you can grow big campaigns, where you can turn off lots of tiny bits that you know are wasting money, rather than risking turning off bigger things & removing something profitable in the process.

Hopefully there’s something here to help you out!

Dan

Editors note: Thanks Dan!  That’s great advice that I think everyone can put into practice very easily regardless of their current PPC budget.

We’ll be back with the final instalment of this thrilling series next week, so all that remains for me to say on behalf of all the docs here at Affiliate Doctors is to wish all of our readers a very Merry Christmas, and of course a hugely profitable 2010!