Hot Tips from The PPC Summit, Day 2

Today at PPC Summit, we had another round of info packed sessions. This is REALLY great stuff.

I picked up some real gems regarding Google Adwords today :

There’s been a veil of secrecy on Google’s part as to what’s the deal with history?

ACCOUNT HISTORY

There’s been widespread claims in the SEM world that people who have had Google accounts for years have a significant advantage (in terms of lower click costs) over newbies who are just starting out.

Now, one of the presenters actually got some answer out of Google regarding account history, and Google claims is takes only 4 months to overcome the disadvantage of having a new account.

So presumably there’s no benefit between someone who’s had a Google account for 1 year vs 5 years, once you’ve had your account actively running for about 4 months you’re on a level playing field – according to Google.  

What sucks is when you first start a new account you could be paying 30%-60% more per click than you otherwise would, just for having a new account!

CAMPAIGN HISTORY

Now many of you have heard that when you first start a new campaign you’ll get high click cost and/or poor ad positions until you’ve build some history.

But how long do you have to build history on a new campaign anyway?

Again, according to Google, in the case of campaign history it takes approximately 2 weeks to build up your history.

So over the first two weeks of building up a campaign expect your traffic to increase and your CPC to drop as your history builds.

There’s keyword history and ad history as well. How fast your keyword history or ad history builds up depends on how much traffic you’re getting.

POSITION NORMALIZATION

Position Normalization? Yeah, sounds like some fancy mathematical term! LOL

Position Normalization was put in place by Google on August 2006, and yet most people have not heard of it.

So what does it mean? It means that Google no longer rewards you JUST for having a high CTR, it’s now ‘normalized for the position.’ So if you’re in position #1 on Google and your CTR is 5%, while most advertisers get 7% CTR in that position, you’ll be penalized, NOT rewarded.

Your CTR only helps as far as it compares to how other advertisers fare in the same ad position.

In the old days you could bid high when you launched your campaign and build up a super high CTR by being in the first position; as a result Google would give you a high quality score. Then you just cut your bid by 75% and your ad would STILL be on the first page thanks to your high quality score.

Guess what? With position normalization this doesn’t work anymore. Unfortunately a lot of people are still aggressively promoting this bogus strategy – totally not their fault, Google slipped position normalization in while no one was looking!
Don’t waste your money by bidding high when launching a campaign – only benefit of biding high now is to build up your ad and keyword history faster – but you don’t have to be in the first position to do this.

I recommend you determine your initial bid as followed:

Assume average conversion rate : 1%=0.01 (5%-10% for pay per lead)

Let’s say you have a commission payout of : $X

I would recommend that you start bidding 1% x $X = 0.01 x $X

Why? Because the Conversion rate times the Commission (affiliate payout) = EPC (earnings per click)

Now if you’re bid = EPC you can expect to break even at this point. Then you can just adjust your bids from there as you collect data.

Now this is just a rule of thumb, but it works well in most cases. It works best if you actually KNOW what your EPC or your conversion rate is for ppc traffic (ask your affiliate manager).

It was SOOO worth paying $1000 to go to the PPC Summit, just for these few tidbits I got on the second day!

If YOU want to be a super affiliate you have to be absolutely hungry for the knowledge.

I’ve been hungry since day one, and I’m still seeking to take my game to the next level.