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The cornerstone of paid search advertising is optimizing towards conversion. So this is really about techniques around how you might optimize your PPC campaigns for conversions.
To optimize campaigns or conversions, you must compare different metrics. And once you’ve tagged everything up and you’re tracking all your sales, you’re able to compare metrics, some keywords against other keywords, and you can assess the cost of these conversions based on the keyword level. If they’re too high, you can do things like you can test reducing bids or improving quality score, change your landing page. And if your CPA is quite low, you might just say, “Well, I’m going to spend more on this because I want more of those low CPA stuff”.
Here are some tips are optimizing your campaign with a high CPA.
If your CPA is too high, try adding negative keywords. Negative keywords will remove low-quality searches that are triggering your keyword. We can find the searches that trigger our keyword in the keywords tab. And then, you can see, in Search Terms, this’ll show us what exactly people typed into Google to trigger our keywords. We’re then able to, from this list, select the keywords that drive high cost per sale or are really expensive and don’t convert or whatever, and we can add these in this tool just by clicking them as a negative keyword.
Another way of reducing CPA is to reduce the bid. And you can test reducing the bid to see if you can reduce any of the CPA cost at this point. The only thing is it may reduce the number of clicks and reduces the number of clicks and may ultimately reduce the number of conversions. So you might get lower cost per conversion, but you might also just get lower conversion. So there’s a balance that needs to be struck there. If the bid reduction is ineffective, you can try and improve quality score by looking at your ads, your landing pages, and trying to improve the customer journey.
However, it may not always be possible to reduce CPA to the desired level because of market competition, internal delays, website updates, or other external factors. But it is important to manage expectations of what can be achieved within reason and forecast accurately. So you can’t always hit the desired level, but you can understand where you can get to and manage those expectations accordingly.
This would be a standard way of comparing competitive metrics to understand how to optimize for conversions. So up at the top there, we can see our CPA is good and we’ve got quite a low cost per sale at €4.00. Now over a little bit in the middle of the screen, we can see that we’re only showing up 50% at a time for those keywords.
So we can sell at less than €5.00 with this particular keyword, but we’re only showing up 50% of the time. So if we look at why are we are showing up 50% of the time, our last impression share due to budget is 50% and our last impression shared due to rank is less than 1%. So our bids are okay, because we’re losing less than 1% of impression share because of bids, but our budget is 50% too low.
The strategy here is to test increasing the budget by maybe 48% and see do we still get loads of conversions at €4 or less than €5 for that particular higher budget.
This is a good way of understanding how we can optimize our budget for higher visibility when we’ve got a low CPA. And then down the bottom there, we can see the CPA is quite high for that particular keyword. But equally in the middle, our impression share is over 70%. We’re spending a lot on that keyword. We’re showing up over 70% of the time and our CPA is very high. So, what I would do in this instance, I would reduce the amount we spend on this particular campaign by reducing the budgets of this campaign. And what I would do with the savings that are made from this campaign budget is I would reinvest them in the low CPA campaign that needs more budget.
We’re using metrics to sensibly take budget away from high CPA campaigns and putting it into low CPA campaigns, which is obviously what we want to do. We want to drive more cheap sales and reduce the amount of high cost sales we do. So this would be a good technique for optimizing conversions using competitive metrics and conversion optimization.Back to Top
Cathal Melinn is a well-known digital marketing director, commercial analyst, and ecommerce specialist with over 15 years’ experience.
Cathal is a respected international conference speaker, course lecturer, and digital trainer. He specialises in driving complete understanding from students across a number of digital marketing disciplines including: paid and organic search (PPC and SEO), analytics, strategy and planning, social media, reporting, and optimisition. Cathal works with digital professionals in over 80 countries and teaches at all levels of experience from beginner to advanced.
Alongside his training and course work, Cathal runs his own digital marketing agency and is considered an analytics and revenue generating guru - at enterprise level. He has extensive local and international experience working with top B2B and B2C brands across multiple industries.
Over his career, Cathal has worked client-Side, in digital marketing agencies and media owners with brands including HSBC, Amazon, Apple, Red Bull, Dell, Vodafone, Compare the Market, Aer Lingus, and Expedia.
He can be reached on LinkedIn here.
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ABOUT THIS DIGITAL MARKETING MODULE
This module begins with the key concepts of paid search and demonstrates how to set up a Google Ads account and create a paid search campaign. It explains how to manage a paid search campaign budget effectively and outlines the different methods that can be used to optimize your paid search campaign. It also covers how to measure and report on the success of a paid search campaign.