SEO

How the 80-20 Rule Applies To Successful AdWords Management

There is a common saying that states:

“The greatest trick the Devil ever played was to make everyone think he didn’t exist”

The same thing can be said about Google in regards to AdWords management. One of the best kept secrets to new AdWords advertisers and managers is that AdWords is complicated. It takes a long time to be savvy in all aspects of AdWords management and unless you dig into niche industries, chances are you’ll just end up being good or mediocre.

During the two years I gave initial training courses to new AdWords managers in White Shark Media, there wasn’t a single course in which most people didn’t say after a couple of days that they could easily grasp the essence of AdWords within the next week or two.

Nobody ever said it seemed complicated during the first week.

I’ve experienced the same thing happening with new AdWords advertisers and people who are “not in the know”. It’s just about keywords and ads, right? So how hard can it really be? If you visit some of the regular business forums online you’ll also read these same statements everywhere. “Seasoned” business owners explain how they’ve reached great success with AdWords and end up saying that hiring external help would be ludicrous.

There are many great in-house AdWords campaigns, but for each AdWords campaign that turned out successful I’m sure I can find from 50 to 100 other advertisers who had to shut down their campaigns or had to turn to external help due to lack of results.

In this blog post I want to reveal how the well-known 80-20 rule applies to AdWords management and how you can achieve better AdWords performance by implementing this mindset in your optimizations.

1) Start Off Where You’ll Make The Biggest Impact

In a perfect world you’d give equal attention to everything that needs to be fixed or that can be improved. However, as you first learn the basics in first aid training, the best thing to do once you get to the scene of an accident is to assess where your efforts will produce the biggest impact.

Helping the guy with the sprained ankle while another person is bleeding to death would be illogical for most people. Helping a person who has already passed away would equally prove to be unproductive. You can’t be everywhere at once and you therefore need to find out where to make the biggest impact.

The same rules apply to your AdWords management. Only in 0.1% to 1% of the cases I’ve ever encountered, has the person managing a website’s AdWords account only had that responsibility. It’s more likely to be also taking care of other marketing efforts or managing several AdWords accounts as an agency.

You should therefore forget all about being “fair” and assigning the same amount of time to all the different parts of your AdWords campaign when optimizing it.

How does this apply to AdWords management?

Throughout the years I’ve seen AdWords managers spending up to 80% of their time during an optimization by focusing on the 18 out of 20 ad groups that had only produced 5-20% of the total clicks/conversions in a campaign.

It would be a very poor use of your time to work that long on parts of your campaigns that are unlikely to ever give you a big return. I won’t go as far as saying that it’s a waste of time because you would have to do that work at a later stage anyways, but to start with you could have spent your time better.

If you first focus on optimizing your ad groups with the highest volume of clicks/conversions you can reek the benefits of your successful AdWords campaign’s while you’ll be battling out with the less important parts in the following months. This is especially important for agency AdWords managers who are expected to produce a return as soon as possible after a new Client signs up. Wasting your initial two months optimizing for peanuts will be like asking your Client to leave.

2) 20% Increase In 100 Conversions Is Better Than 20% Increase In 30 Conversions

You can’t really argue against the calculation made above. If you improve your conversion rate by 20% in an ad group with 100 monthly conversions you’ll be adding 20 more conversions every month.

Doing the same with 10 ad groups that are producing altogether 30 conversions a month will only give you 6 more conversions. The work you put into optimizing ads in 10 ad groups is, on paper, 10 times bigger than if you were optimizing one single ad group.

By focusing on the ad groups with the highest performance you can get so much more out of a smaller effort.

3) Higher Search Volume Allows You To Test Ad Copy Faster

Your primary ad groups are usually the ones that produce the biggest amount of sales and often the biggest amount of clicks too. In order to be able to say that a new ad is performing better than your current champion ad you need to have statistical significance (use this Excel sheet by Chad Summerhill on the subject here).

If you’re simply deciding that an ad with 4 conversions is better than the same ad with 3 conversions, then you’re likely to make the wrong decision. 4 conversions versus 3 aren’t facts – that’s guesswork, my friend.

By testing your ads in your primary ad groups you’ll therefore be able to gain significant data in just a couple of weeks in order to determine with solid evidence if your new ad is actually performing better. This will allow you to test more ads faster, which can drastically increase the overall return on your investment.

4) 95% Of Your Efforts Take Just As Long In Your Primary Ad Groups As In Your Secondary Ad Groups

Except for the task of mining Search Query Reports, all the other tasks performed in primary ad groups will be identical in minor ad groups:

  • Bid management
  • Ad testing
  • Dynamic bid adjustment
  • Ad Extension optimization, etc.

These will all take the same amount of time whether your ad group has 100 clicks or 10,000 clicks.

Investing your time in the areas that can give you the biggest return is therefore time wisely spent.

Don’t Just Forget About Your Secondary Ad Groups

Once you finish reading this post you might think that you shouldn’t care less about your secondary ad groups. That’s not the right way either. There will come a time in which you will struggle to find ways to optimize your primary ad groups. When this time arises you’ll no longer get the biggest return on your time only by optimizing your primary ad groups.

Remember that it’s all about finding out where you can get the biggest return on your time spent.

 How the 80 20 Rule Applies To Successful AdWords Management

Andrew Lolk

Co-Founder at White Shark Media at White Shark Media
Andrew Lolk is the author of the 189-page free AdWords ebook The Proven AdWords Strategy. He's worked in AdWords since 2009 and have co-founded White Shark Media; A leading Search Marketing agency and Google AdWords Premier SMB Partner.
 How the 80 20 Rule Applies To Successful AdWords Management

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2 thoughts on “How the 80-20 Rule Applies To Successful AdWords Management

  1. Excellent article. I have realised just how much time can be wasted chasing the long tail whilst core keywords are performing well but well under their potential. The “if it ain’t broke don’t fix it” temptation to leave campaigns that are giving a return alone whilst we look at those that are under performing can have a massive impact on the bottom line.

    Give me focus every time.