Optimizing Ads in AdWords and Yahoo
This post was made Dec 19, 2007 by Carlos del Rio
Do you optimize your ads for pay-per-click manually? You should.
Both AdWords and Yahoo! Search Marketing offer a convenient option to “Optimize” ads.
Yahoo! :
Google:
It is tempting to use these option if you are new to the system, but they do not have your best interest in mind. Both systems will skew the ads they serve based on your click through rate (CTR). While raw traffic data is an adequate measure it is unlikely to serve your real ends — conversions (sales or leads). A well written ad can have a high CTR without having a positive return on investment.
In general the goal PPC advertising is some type of conversion. To this end you should manually pick which ad is working best for you. The simplest way to accomplish this is to divide your impressions (number of ads served) by your conversions to get what I call True Conversions (TC).
Impressions / Conversions = TC
Using TC allows you to compensate for variations in impressions across campaigns, ad groups, and ads to see where you are deriving value. If you really do not have time to test ads manually you can use True Conversions to spot check if the automated systems are making the correct decisions.
