Paid Search Clarity – Part I

Yesterday I noted that paid search managers face three challenges in trying to effectively manage paid search campaigns:

• A lack of clarity (reporting problems)
• Difficulty defining priorities (strategic and planning problems)
• Horrible inefficiencies (mechanical and processes problems)

I believe that these problems need to be solved in order to improve paid search management, both the profession and the results. First you need to see what’s happening, then you’ll want to decide what needs to be done, and then you can hopefully get it done with a reasonable amount of effort. That doesn’t sound like too much to ask. But 4-5-6 years into explosive growth in paid search and we’re hardly out of the starting gate. Today I’ll expand on the issues regarding reporting and clarity, and in future posts dive more deeply into the problems of setting priorities and executing paid search tasks. What Paid Search Reports Don’t Tell You Paid search is about answering questions. People type queries and search engines return results, which are lists of possible answers to the questions they believe are being posed. I want to structure my campaigns as tightly as possible around those search queries. Every search engine tells you how many impressions your ads had, and how many clicks you got. They have to I suppose, since the CPC is what drives your billing. What I really want to know is what did I miss? And why? Then I can set goals and define strategies or tactics (or at least design tests) to do better. Each conversion hopefully generates more revenue than it cost to cause that conversion, which is reflected in the rather innane ROAS metric. Being impressed with a good ROAS seems akin to believing you’ve saved money by buying something you didn’t want when it was on sale. Goods or services have costs (COGS) and the only metric that matters is ROI taking account (at least) both direct-marketing and goods/services expenses. When my clicks do generate revenues, I’d like to know which ones. Then I can make wise decisions about future investment and effort around certain keywords and queries. Unreasonable Demands? So I’d like to know which search queries generated which results, how many clicks I didn’t get and why, the actual amount of profit made on each transaction (and from each keyword, query, and click). Do any of these sound unreasonable? Far-fetched? Demanding? Yet these desires are not generally or specifically fulfilled through the paid search reporting capabilities provided by the search engines, popular web analytics software, or even specialized PPC management tools. Surprised? The devil is certainly in the details, and some of the information defined is available in some packages/places, but generally with huge compromises and limitations that disqualifies or invalidates them as actual or sufficient information. Really? Yes to the best of my knowledge, as the next post will review in somewhat excruciating detail. I’m happy to learn new facts or discuss this further in the comments – significant corrections will be appended to that post. User search queries, accurate revenue & expense allocation and matching, and ROI reporting are just three of the ways that the current generation of PPC reporting generally fail paid search advertisers and managers. The fact that these problems/limitations are seemingly not well known, frequently discussed, and therefore clammored for as improvements is one of the things that has to change to move the business/market forward.