Getting More from Paid Advertising

September 4, 2011

September 4, 2011


This is a guest post from our friends at ReTargeter. By now virtually everybody knows that online advertising is crucial to driving sales and spreading awareness for your business. Over $72 billion will be spent on ads in the United States alone by the end of 2011, and online advertising is the fastest growing segment of […]

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This is a guest post from our friends at ReTargeter.

By now virtually everybody knows that online advertising is crucial to driving sales and spreading awareness for your business. Over $72 billion will be spent on ads in the United States alone by the end of 2011, and online advertising is the fastest growing segment of ad spending in the world.

However, despite the increased attention and spending directed towards paid advertising, many campaigns still don’t produce tangible benefits for businesses in terms of new customers or sales. Part of this problem is a failure to define the goals of an ad campaign beforehand. Online advertising platforms deluge their users with mountains of data, but provide little guidance on how to interpret all of the numbers. Having clearly defined metrics ahead of time can make the difference between a successful campaign and a waste of time and money.

Defining Success

There are three key metrics used to measure the performance of an online advertisement:

  • Impressions: Every time somebody sees your ad online, that counts as a single impression. Impressions help you gauge the amount of visibility your brand has online—a high-impression ad campaign will expose a lot of people to your brand, while a low-impression campaign will likely go unnoticed by large portions of your target market.
  • Click-Through Rate (CTR): How many people who see your ads actually click on them? That’s what Click-Through Rate tells you—the percentage of people who clicked on an ad after seeing it. This is a good indication of how attractive your advertisement’s text and graphics are to viewers.
  • Conversion Rate: Unless you’re only seeking to increase your brand awareness, chances are that you’re interested in more than just visits to your website—you want those visits to lead to sales. The conversion rate lets you know what percentage of clicks actually result in sales, leads, or whatever other action you define.


Harness the Numbers

In order to reap the full benefits of your online analytics, it’s important to enable conversion tracking on the ad platform you’re using (Google AdWords and Microsoft’s Bing AdCenter both offer the service). With conversion tracking enabled, you can assess the performance of the two
key factors in your ad campaign:

  1. Keywords – Use CTR and conversion rate to data to determine which of your keywords are the most relevant, and adjust your bids accordingly to optimize your ad spending
  2. Ad Text & Graphics – Identify your top-performing ads and pause or remove the lesser- performing ones to maximize clicks and conversions


Test, Test, Test

Improving an online ad campaign is not a one-time action—it’s an ongoing process. The best way to refine your campaigns and increase the ROI of your ad spending is to experiment with different keywords, ad text/graphics, and landing page configurations in a systematic way. Track the relative performance of your keywords over time to get a better sense of which words are worth bidding more for and which ones you can safely ignore. Create multiple variations of ad headlines and text to find the optimum combination for clicks and conversions. Configure your landing page to reduce bounce rates and improve your ad quality scores by utilizing the free web site optimizer from Google.


Bring Them Back

Standard online advertising is good for getting noticed, but what about making your brand remembered? Retargeting (also known as remarketing) uses cookie technology to serve your ads to visitors who have left your website, which increases your brand’s online visibility, keeps your products and services fresh in your visitors’ minds, and encourages visitors to return to your website.

By leveraging the ad inventory of multiple advertising networks, retargeting companies can make your ads seen on over 98% of the ad-supported websites on the Internet, providing your brand with a magnified online presence that would be prohibitively expensive to recreate via direct ad buys.


Persistence Pays

Online ad campaigns always have room for improvement. Keeping an eye on your ads’ key metrics will help you identify weak spots and opportunities in your campaign that will pay off with clicksand conversions. Continuous trial-and-error will hone your campaigns’ performance while providing valuable insights into what does and doesn’t work in your ads. Next-generation advertising solutions like retargeting can drastically magnify the effectiveness of your ads and keep your brand of top of mind with your visitors long after they’ve left. No matter which approaches you take, thinking of your online advertising initiatives as an ever-evolving process is the key to ensuring steady improvement and higher ROI for your time, money and effort.

Hafez Adel is a Marketing Associate at ReTargeter, a self-serve display retargeting platform.

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