SEO

Why You Must Look Beyond Google Adwords Click Through Rate Concept

In Google adwords advertising space, click through rate also known as “CTC” is a familiar term. It is the mathematical end result of a situated ad campaign number of impressions divided by the number of clicks acquired at a particular point in time. Google uses this mathematical denotation to measure the relevance of a given ad and accords the ad with some credit reward proportional to the positive or negative outcome of the end result.

One such credit reward is a rise or fall on quality score “QS” Quality score is tied tightly to the apron of click through rate. If an Ad click through rating is high, then there will be a correspondence rise in quality score and if the opposite is the case, it will respond accordingly – thus click through rate and quality score are twin sister metric, dancing on the same wavelength.

The overall benefit of these two metrics to the advertiser is a sharp reduction in bid price and a favorable ad position. This is assuming your quality score level, occasioned by click through rate is on the positive side. This is the chain reaction concept that drives Google adwords program. Rewards for an advertiser’s effort in creating a quality ad that satisfies the aspirations of human visitors and keep them coming back to the program.

Is Click Through Rate Concept a Catch – 22 Or a Greek Gift?

Depending on what side of the spectrum one is, the truth of the matter is that click through rate concept has never been fully explained. When Mr. Hal Varian, the chief economist at Google explained The Concept Behind CTR and Quality Score, there were two things that he did not reveal to his stupefied audience. One: that click through rate does not equal conversion rate. Two: that whether your clicks convert or not, Google is better for it.

The real argument here is not whether we need clicks to sustain our campaign. Of course we do need quality clicks – lots of it at that. But when your campaign starts acquiring clicks at an astronomical rate for the wrong reasons other than conversions, then your days in the game of adwords marketing program are numbered. Perhaps that explains why Google in its infinite wisdom thought ahead of time and introduced the Click Through Rate Concept as a cushioning effect to prolong your dying day in the game. Lose money fast or slowly, you are dying anyway.

How Do We Move Beyond Google’s Jingoism of Losing Money Slowly?

Google adwords is superb and undisputedly the quickest and most widely used online advertising media to showcase your brand and connect with your perceived customers right on the fly. The key to success in this ubiquitous marketing media is buried deep inside of your Keyword phrase.  In fact, if there was to be an alternative name to adwords marketing, it would have been “Keyword Marketing” because your customers must first use some sort of keyword phrase before able to connect to your product.

If you understand the dynamics of keywords, then your adwords campaign will be driven by conversion rate. Most adwords advertisers craft their campaigns around click through rate with the hope of gaining favor from Google thereby saving cost. But Google is wiser because they know that their adwords program is not a place to save money. Whereas Click through rate concept enables you to minimize cost and maximize lost, keyword dynamic concept enables you to minimize cost and maximize profit.  Now, lets take a close look at two hypothetical keywords – “Swiss Wrist watch” and “Maverick I I Titanium” What you will quickly detect from these two keyword is that whereas one is inquisitive and defined to a specific brand, the other is just a wild card without any commercial intention.

If a searcher uses the keyword Maverick I I Titanium” which also is a family of the Swiss wrist watch to find your ad defined specially for it, the probability of closing a sale is as good as done. The dynamic force behind this high probability is that the searcher already knew that there are so many brands of Swiss wrist Watches but has taken his pain to narrow down and settles for a particular brand.

Again, if you were to deploy these two keywords in adwords campaign, the bid cost of Maverick I I Titanium” will be next to nothing while you will have to fret and tweak forever before you can strike a balance with keyword “Swiss Wrist watch” The reason is that Google already assumed that “Swiss Wrist watch” is an important keyword because it has a huge volume search despite no transactional relevance while  “Maverick I I Titanium” which has high probability of sale conversion but with low volume search has no relevance in the eyes of Google.

In Summary therefore, it is pertinent to realize from the onset that conversion driven adwords campaign occasioned by highly targeted and defined keyword phrase is the magic wand that brings success in adwords marketing and not the click through rate concept.

 Why You Must Look Beyond Google Adwords Click Through Rate Concept

Willy Oghinan

This is a guest post by Willy Oghinan, a search engine marketing consultant and CEO of Salesplux, a leading Google AdWords Management agency.
 Why You Must Look Beyond Google Adwords Click Through Rate Concept

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6 thoughts on “Why You Must Look Beyond Google Adwords Click Through Rate Concept

  1. I agree, we have got to be careful that our ad budget isn’t getting eaten up without producing conversions. I have considered this before in my continuous battle for good quality score, not wanting to pay to dig an ad out of the hole and hoping that those high CTRs even mean anything to me. At least with Google, I can follow my Adwords performance down to goal conversions I’m tracking on Google Analytics. Microsoft Adcenter is a different story. I haven’t yet figured out how to track my keywords/ad performance beyond the statistics they give me. I work for a smaller company so I do analytics, PPC, SEO, social media and more. At the end of the day, sometimes PPC gets left un-optimized because there is so much else to do. But what a waste it is, if we aren’t tracking final conversions and developing a true ROI. You are so right; those CTRs can be misleading on overall performance.

  2. I learnt the hard way worrying about my CTR thinking the conversions would take care of themselves. For me it all seems a bit of a balancing act and every market needs to be handled differently. Achieving the high CTR you set out for (when a beginner) can also get you to ad position one right up the top of the SERPs where you get loads of impulsive clicks that cost you money, another thing I learnt the hard way!!

  3. Totally agree – clickthroughs for show, conversions for dough!

    Use Conversion Optimizer and optimised ad serving with accelerated delivery and unlimited budget to let Google manage your black box for you … but make sure you know all your numbers first :-)

  4. At the end of the day, sometimes PPC gets left un-optimized because there is so much else to do. But what a waste it is, if we aren’t tracking final conversions and developing a true ROI. You are so right; those CTRs can be misleading on overall performance.

  5. “In Summary therefore, it is pertinent to realize from the onset…” – We have a new winner for the best start of a concluding paragraph in a blog post ever. Congratulations.