Is your AdWords account the digital advertising equivalent of a couch potato?
If your account is anything like most of the 2,500+ AdWords accounts we’ve audited in the last three years, your account doesn’t seem to do much more than suck up ad spend and watch the competition pass you by.
And, the sad thing is, that analogy isn’t too far from the truth. The average AdWords account wastes 76% of its budget.
It’s time to change that.
Now, odds are that you’ve already abandoned most (if not all) of your New Year’s resolutions by now… but you still have a chance to whip your AdWords account into shape.
Give Your Budget a Quick Check Up
Now, hypothetically, your AdWords account should be working hard to turn your marketing dollars into new conversions and sales for your business…right?
I mean, the point of paid search is to get your ads in front of an audience that is actively looking for what you’re selling. That works great — if your ads are showing up for the right people.
Unfortunately, most ads are showing up in front of the wrong audience.
Remember, your AdWords account is a couch potato. It takes the path of least resistance, which means it doesn’t care whether or not you are getting clicks from the “right people.”
To see what I’m talking about, open your AdWords account and pull up your Search Terms report:
This report tells you the exact search terms people are using to find your ads. In a fit, healthy account, most of your ad spend should be going towards terms that produce conversions.
To check the health of your AdWords account, add a filter for “Conversions < 1,” like so (note, this only works if you have high quality conversion tracking set up in AdWords — if that’s not the case, you can assume you’re probably wasting well over 76% of your ad spend):
Hit “Apply” and Google will give you a list of all the search terms which haven’t produced conversions in your time period (I recommend looking at the last 3-6 months for best results).
If you scroll to the bottom of the page, you can figure out how much of your ad spend is being wasted on useless search terms by dividing the cost in the “Total – all filtered search terms” row by total cost.
Multiply that by 100% and you can see what percentage of your ad spend your account has been wasting. Odds are, it’ll be somewhere around 76%.
Getting Your Budget Off Its Butt
Obviously, letting your AdWords account gobble up 76% of your budget and give you nothing in return isn’t a great idea. The question is, how do you fix it?
Fortunately, the good news is, you can utilize the data in your Search Terms report to get your AdWords account back in shape. Depending on what your primary problem is, you’ll need to take one of two approaches:
1. Shed a Few Pounds (of Keywords)
If you look through your Search Terms report and can’t help but wonder, “How did my ad show up for that search?”, you’re probably dealing with a morbidly obese keyword list.
Don’t worry, though, you’re not alone.
In the average AdWords account, 94% of the keywords have never produced a conversion. To make things even worse, those useless keywords suck up 72% of the ad spend.
To get your account into shape, it will need to lose some serious keyword weight. Take a look at your Search Terms report and identify the keywords that aren’t producing results. Then, get rid of them.
Once you’ve done that, create new campaigns around your effective keywords and search terms. Wait 2-3 months and then repeat.
This may take some effort, but stick with it — the more wasted ad spend you eliminate, the better your campaigns will perform.
2. Bulk Up Your Advertising Strategy
Not all couch potatoes are overweight. Some are simply wimps. If your account isn’t suffering from keyword bloat but you’re still wasting a lot of ad spend, you probably need to bulk up your paid search strategy.
Basically, you just have to keep pushing forward until you have a breakthrough.
However, if you’ve tried everything you can think of without success, you may need to consider simply eliminating the keyword.
In addition, you may find that certain search terms share common elements (for example, location-specific searches). Alone, they might not seem like a big deal, but taken together they expose a big flaw in your advertising strategy.
No matter what your account’s specific weaknesses are, looking at your Search Terms report can help you create a testing plan that will ultimately deliver much stronger performance.
In Pursuit of Perfection?
As you whip your account into shape, it’s important to remember that even the fittest athlete has their limits. Similarly, you’ll never be able to get your non-productive ad spend down to 0%.
At Disruptive, we typically shoot to keep wasted spend at 40% or lower. Here’s why:
- People are unpredictable: There will always be those random “Why would someone search for that?” search queries. No amount of optimization can prevent all of those impressions or clicks. But, you can limit them.
- Tests don’t always work out: Like I just said, no one bats a thousand, so if you are regularly testing new keywords and ads (a very good idea), sometimes your new ideas just won’t pan out. That’s okay, provided you are learning something from your tests.
Yes, you can get wasted ad spend down to less than 20%, but that usually means you are maximizing short-term profitability at the expense of long-term growth.
Beefing up Your AdWords Account
At this point, you’re probably wondering, “How long will it take to start seeing results?”
The good news is, it takes a lot less time to get an AdWords account into shape than it does to turn a couch potato into a star athlete. Assuming your wasted ad spend is in the 76% range, you can expect to see significant improvement within a few weeks.
To show you how this works, take a look at this GIF, which depicts actual results we see with our clients as we cut back their wasted ad spend:
Here, you can see how cutting ad spend to search terms with no conversions (or very few conversions) affects account performance. You can also see how those tweaks influence total conversions and ad spend.
As you might imagine, the less you spend on the wrong keywords and search terms, the less you have to spend to produce the same results. Then, as you begin to reinvest that spend in the right keywords and search terms, conversions spike rapidly.
The best part of it is, this isn’t a linear equation. It’s an exponential equation.
To put it simply, for every 10% you cut wasted ad spend, you see a 30-60% drop in cost-per-conversion.
So, if you’re wasting 76% of your ad spend and you make the changes suggested in this article today, you might only be wasting 66% of your ad spend tomorrow. As a result, your cost-per-conversion over the next few weeks could be 60% lower!
Now for the “before and after moment” (we’re really working this analogy now, aren’t we?).
Here’s a quick chart that outlines how reducing a client’s useless spend from 91% down to 68% affected their cost-per-conversion over the course of just 6 weeks:
In a matter of weeks, this client’s cost-per-conversion dropped by 76%!
Best of all, this approach simply eliminates the wrong clicks, so it doesn’t hurt conversion quality or close rate. As a result, we typically cost-per-sale drop by a minimum of 25-65%.
Turning your budget-guzzling AdWords account into a money-making workhorse will take some effort, but as every good trainer knows, “pain is just weakness leaving the body.”
And who can afford a weak AdWords account?
But, if you take the time to use the data in your AdWords account, you can whip your AdWords account into shape in just a few weeks.
Any thoughts on this approach? How much wasted ad spend did your account have? Any other advice on how to get more performance out of your AdWords account? Let me know on social media.
Featured Image: DepositPhotos
Screenshots taken January 2017
Subscribe to SEJ
Get our daily newsletter from SEJ's Founder Loren Baker about the latest news in the industry!