In Part 1, we discussed four techniques for organizing your Google PPC campaigns (techniques that transfer nicely to Yahoo, Microsoft, and other PPC programs). The first four techniques were focused on the campaign level and laid the foundation for a solid structure within which to create, manage, and analyze your actual ads.

Now, let's take a look inside ad groups at techniques for managing the vast number of keywords and ads you will undoubtedly use.

The first four tips provided you with the blueprint to build the main beams and framing of your campaign structure; the next four tips will show you how to arrange your "interior design" for a more convenient and productive environment.

5. Organize ad groups around keywords.

Campaigns are for organizing your ads conceptually. By the time you get down to the ad group level, you need to start specifying ad groups in terms of specific keywords. Not concepts--keywords. So under the "Action" campaign you might have the following ad groups:

• Schwarzenegger
• Stallone
• Bruce Willis
• Sci-Fi
• Monster
• etc.

Obviously this can turn into a huge number of ad groups. Yep. That’s the idea. It’s much better to have 50 ad groups with 20 keywords per ad group than to have two ad groups with 500 keywords each. Why? First, you can write specific ads for each ad group that actually contain the keywords within them.

For example, the "Schwarzenegger" ad group could contain many keywords, such as:

• Schwarzenegger flicks
• Movies Starring Schwarzenegger
• Movies Starring Arnold
• Arnold Schwarzenegger
• Best of Schwarzenegger
• Schwarzenegger action movies
• etc.

(Starting to get the idea of how your keywords can balloon?)

The ads within this ad group will all contain the word "Schwarzenegger" thus there will always be a match between the keyword searched and the ad displayed. Not only does this create the critical keyword/ad relevance factor that Google likes, but you’re likely to see a better CTR because it’s more relevant to searchers too. Both of these factors will improve your quality score and result in a lower CPC.

Another reason to use plenty of ad groups is that you will find it easier to determine which ads are working well for you by looking at it from the ad group level rather than zooming clear down to the keyword level and peering at a massive list of keywords. It’s a way of breaking the data down into manageable chunks just as we did at the campaign level. Again, you want to do triage at the ad group level before diving into the keywords themselves.

6. Use the "sculpture method" to get your campaigns under control.

Let’s say you’ve set up 20 campaigns with 20 ad groups per campaign. You have 20 keywords and two ads per ad group. That’s 8000 keywords and 400 ads to keep track of. Now it’s time to start analyzing their performance and making adjustments.

Chances are, in the beginning you’ll use the sculpture approach to manage your campaigns. This means that you’ll notice situations that look like they could be improved and make little adjustments in an ad hoc fashion, chipping off some CPC here, building up some keywords there. For example, you may notice that you are showing up near position 1 for a given ad group and, upon closer examination, you see some keywords that you think you could get into a decent position by bidding significantly lower. This is a perfectly fine way to gradually mold your campaigns into the basic shape you want.

As you do this, you must always be aware of the date range you’re looking at. The metrics for one date range may be completely irrelevant or even misleading to the question you’re currently trying to answer. On one hand, you want to make changes based on the most recent data. If you make a change to a keyword bid based on the last month of data, you may not be factoring in that the CTR for that keyword has changed significantly in the last week. So all things being equal, you want to make changes based on the most recent data. On the other hand, you may not always have enough recent data to reach a valid conclusion. You don’t want to make decisions based on the behavior of just a few individuals, so you may need to expand your date range at times. Of course, if expanding the date range means you muddy your results because you’ve made big changes during that time - well, now you’re back to the first scenario.

Obviously, keeping track of many ad hoc changes is tricky. An indispensible tool when using the sculpture method is the My Change History located in the Tools section. If you are ever in doubt about why some metric has changed suddenly, you’ll often be reminded of what you did to cause the change right there.

7. Conduct controlled experiments.

The sculpture method is best used in the beginning as a quick and dirty way to get your campaigns under control. Once you’ve achieved a certain level of stability, however, you’ll want to switch to more controlled experiments in order to determine ways to optimize your campaigns. The sculpture method is based on gut instinct and assumptions - i.e. you decide being in position 4 at a lower CPC is optimal versus being in position 1 at a higher CPC.

Controlled experiments allow you to turn assumptions into facts. If you think being in position 4 is more cost-effective, find a keyword that has been consistently showing up in position 4 for a while, mark the date, and bump your bid to push the ad into position 1. Let it run that way long enough to collect a significant amount of data. Then check to see if your cost per conversion has changed significantly. Simple.

Two key points must be emphasized about controlled experiments:

i) You must get significant data. If your control condition gets two conversions and the test condition gets three conversions, you are not ready to conclude this experiment. Those numbers just aren’t big enough to be reliable.

ii) There should be no other changes other than the factor you’re testing. For example, if you’re testing the effect of a bid change, don’t change the ad text associated with that keyword or the design of the landing page at the same time. Those are pretty obvious. But some changes are not as obvious and not even subject to your control. For example, a competitor suddenly entering the scene with a very compelling offer could throw off your results. In order to avoid the possibility of random factors throwing off your results it’s best to conduct experiments as quickly as possible. That means conducting experiments on your highest volume keywords.

8. Use Lyris HQ PPC Management.

While the AdWords interface is quite capable, it’s far from perfect. To expedite and extend the management of your campaigns in a powerful way, you can use the Lyris HQ PPC Campaign Management tool.

This system provides an enhanced interface to the same data you manage through the AdWords site. It incorporates visual data representation techniques that make it much easier to identify anomalous data that might require your attention. It also includes a "Problem Campaign" report that automatically identifies those campaigns, ad groups, keywords, or ads that aren’t performing well and summarizes them in a handy list.

Lyris HQ also uses advanced Web 2.0 technology for a user-friendly environment with a lot more dragging and dropping and a lot less clicking and reloading. This is a huge time saver.

Furthermore, integrated keyword research tools go well beyond those provided by Google, allowing you to more easily build the most complete set of keywords.

The Lyris HQ PPC campaign management tool also emphasizes the tracking of campaigns for Web analytics . Rather than a single tracking parameter, the system will automatically append a set of tracking parameters that allow you to easily segment visitors from any campaign, ad group, keyword or ad. When combined with the organizational structure described above, you have the ability to perform granular analysis on your campaigns based on visitor behavior after the click.

Conclusion

Whether your PPC budget is modest or massive, you need to make the most of it. And either way, the time you spend managing must be factored into the cost of the program. It’s bound to be significant. The tips described in this article will not only help you to make your campaigns more cost effective in terms of click-through rate, cost per click, conversion rate, etc., but it will also help you to achieve these results in less time. And that is money in the bank.

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About the Author 

Dane Christensen is the SEM Manager for Lyris. He is responsible for optimizing the company's PPC bid management across seven different search engines.

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