One of my favorites is ‘Text Ad CTR Low’ which identifies text ads running in your ad groups which have a CTR that is some percentage lower (30% by default) than the other text ads in the same ad group. This has the potential to make huge improvements in your quality scores and overall results.

In this post we’ll look at how to setup and best use this best practice.

Setup

To begin you need to configure and start the best practice. In the Best Practices Manager, create a new ‘Text Ad CTR Low’ best practice, modify the options if necessary, and assign it to run on some or all of your campaigns.

The right option settings depend on the behavior and performance of your account. The default CTR Difference of 30% is a good starting point if you have 50 clicks or more per text ad in the defined lookback period. If you don’t have that many clicks in the desired timeframe, raise the CTR Difference to 100% and you can get statistically significant results with only 12-15 clicks.

See ‘Adding and Editing Best Practices’ in the ClickEquations help system for more detailed information and instructions.

Save your new best practice and it will run that evening. Go get a good night sleep.

Reviewing Best Practice Alerts

The ‘Ad Alerts’ section of the ClickEquations dashboard will now tell you if any your ad groups are in violation of your defined best practices. Click on the red alert counter and you can see how the under-performing ads are spread across the various search engines.

To see the problem ads on Google, click the number next to Google. The ClickEquations Manager will open to the Text Ads tab with all the problem ads displayed. From here you’ll be able to review the details of the situation in each ad group, and take corrective action.

Resolving Low CTR Text Ads

The list of text ads you’ll see only includes the ones that under-performed. If you’re in a hurry you might just pause them all, or edit the ad copy to try and boost the CTR.

But a better approach would be to dive deeper into the specifics for each ad group.

Here’s the steps you might take:

• Click on the ad group name next to the first text ad in the list. This will open tab for that ad group so you filter down to only the ads in that ad group.
• Click back to the Text ad tab to see the under-performing text ad and the ads it is competing against.
• If there are paused or deleted ads on the list, use the Edit Filter.. command to display only items with the status of Enabled, On, or Active.
• TIP: Name as save this filter as ‘Show Only Active/Enabled/On’ for future use.
• Compare the performance of the text ads to see if you really want to pause or rewrite the under-performing ad.
• Use the Verster significance checker to make sure you can be statistically confident in the results. If not, use the calendar to bring in more data from a longer time frame.
• When you have confidence in the data, take action on any under-performing ads – pause or rewrite.
• Check the box next to the under-performing ad (if you didn’t delete it) and clear the alert.
• If there are more under-performing ads, Click on the remaining number next to the Text Ad CTR Low alert in the Alerts palette, and repeat this process for the next under-performing ad.

Economic and QS Benefit

The process of eliminating poorly performing text ads from within your ad groups should have huge benefits to your account. Every under-performing ad that is eliminated will increase your CTR, which should drive up keyword quality score. And as we know, better quality score results in more impressions, higher positions, and lower CTRs.

Wrapping this process around a thoughtful effort to write and test better ad copy, and keep an eye on not only CTR but also conversion rate, can further the positive effects.

When you run lots of text ad tests – as you should – keeping track of them and waiting for sufficient data to hit some level of confidence in the results is a management challenge. Using the ClickEquations best practices to automate the management of under-performers is a dramatic improvement to the process.

Related posts:

1. Secret Truth Series #18: Effective Text Ad Testing Text ads are trying to answer questions. Writing text ads...
2. Best Practices with Avinash Kaushik (Video) A few weeks ago I sat down with Avinash to...
3. Introducing Best Practices in ClickEquations Anyone who has managed a serious paid search campaign knows...

Writing text ads is difficult because you have only 95 characters to stand out from a sea of competing messages and persuade the searcher that you’re the ad to click.

There are many strategies and tactics to accomplish this, and both technical skill and creativity are required. The process takes considerable time and effort.

And there is only one way to measure success. Testing.

But testing requires more than simply running a couple of ads simultaneously. It requires the conditions for a fair test, a clear goal, and valid measurement and analysis. Much of what passes for text-ad testing in paid search lacks one or more of these requirements.

Let’s look a little closer at each to better understand how to properly test text ads.

Conditions For Text Ad Testing

Text ads cannot be effectively tested too early in the process of optimizing your account or ad groups.

If you haven’t yet optimized the keywords, match types, ad group organization, and negatives then the search queries coming into the ad group will be too diverse. If people are asking 25 different questions it’s impossible to compose any single answer that will satisfy all of them. If you try to test text ads too early, you won’t be able to trust the results. Maybe you’ve got a lousy text ad, or maybe the ad is just running against a lot of very untargeted or unqualified search queries.

So before even beginning to worry about text ad testing, make sure you’ve read and implemented Secret Truths #1 – #8. When the vast majority of the queries coming into an ad group are similar, you’re read to test text ads.

Of course, you have to write some text ads when you setup an ad group. And you should monitor and review their performance and make changes as necessary. But hard core text-ad testing – statistical comparisons – isn’t reasonable or necessary until the ad group has been properly constructed and intelligently optimized and – in terms of search queries – stabilized.

What You Can and Can’t Control

Another factor to consider in text-ad testing is the reality that paid search is a dynamic environment. Keywords get added, negatives expanded, bids change, competitors impact average positions, and other account modifications take place on a regular basis. There are variations in activity and results based on day of the week, week of the month, month of the year, weather, news events, sales, inventory, competitor promotions, and more.

So in the time it takes your ad group to get a sufficient number of impressions or clicks for a good test, how can you be sure that it is the ad copy that you’re really testing?

The answer is that you really can’t. There are no static environments in PPC. But all the ads in the test are subject to almost all the same environmental conditions, so many would argue these external influences don’t influence relative performance. That may be true, it may not. But you can’t control for many of these variables, so we ultimately have to accept them as a fact of life, a limitation in the system.

Whenever possible however, try to limit those changes you do control during deliberate text-ad tests. Don’t introduce new keywords or negatives or dramatically shift bids. Chance are if you find the need to make radical changes of any of these types you’d be better off making them and then restarting your tests.

Clear Text Ad Testing Goals

The goal of text ad testing is to determine which ad copy delivers the best click-through and/or conversion rates.

• Most ad testing focuses on CTR. That’s clearly the direct goal of the ad, and helps to drive up quality score.
• Conversion rate should be tracked and considered, even if CTR is the primary goal. There are many ways to incite a click, but Google gets paid for clicks while you get paid for conversions.
• The conversion-per-1000-impressions metric (CP1K) is a great way to blend these two goals and find the truly optimal ad copy. (I hope to write more about CP1K in the near future).

Statistically Valid Text Ad Testing Analysis

Assuming you have a clear goal in mind and a stable testing environment, test data becomes the next hurdle. How many impressions and clicks does a set of text ads need for a valid test?

The answer to that relatively straightforward question has eluded most PPC managers for years. I assume this is due to the fact that most of us aren’t trained mathemeticians or statisticians. (I’m certainly not.) And most of the software we use to create and edit text ads does not provided the statistical support we really need.

So we’ve slithered forward based on the conventional wisdom that suggests tracking ‘at least 100 impressions or 10 clicks before there is enough data to declare a winner’. Unfortunately this really isn’t very accruate or useful advice.

Statistically, it turns out that those of us who’ve been reacting to text-ads with anything near 100 impressions or a dozen or so clicks have regularly made essentially random decisions. We’ve paused the better ad many times, letting the loser run. We’ve sabataged our own results. Repeatedly. Over long periods of time.

Consider the example shown at right: Three text ads running in an ad group. About 500 impressions each.

Is there enough data to make a wise decision?

It seems pretty clear. The first ad at 1.98% CTR appears to be our winner. But the statistics tell us that it isn’t that clearcut.

I looked at the statistical significance and confidence intervals for these ads. We can only be 80% confident that the CTR difference between the first and second ad are actually different. Same for the difference between the second and third ad.

80% confidence is not very high.

It’s not considered high enough to be sure something is true in most activities where statistical confidence is considered. For scientific activities a 95% rate is the desired standard.

To understand the potential error in accepting these numbers, look (below) at the range of possible CTRs for each of these ads that we can be sure of with a 95% confidence.

The first ad may actually be as low as 0.82% CTR, or could be as high as 3.14%. That’s a pretty wide range – we just don’t know yet, with a high level of confidence, what the CTR of this ad is going to be. You can see similarly wide ranges for the other two ads, and in comparison see there is plenty of overlap in the potential which means if we really let this test play out, we may get a very different result.

So how many impressions would it take to get 95% confident in the differences?

If we let these ads run until they had around 1000 impressions each they’d achieve a 90% confidence. It takes nearly 1500 impressions per ad to hit 95% confidence.

The actual number needed for any given set of ads depends a lot on the CTRs and their relative difference. But it’s a rare circumstance when anything like 100 impressions or 10 clicks is adequate.

You can check the numbers on your own ads using two great tools:

• Vertster.com offers a simple, free, online utility that lets you enter CTRs for two ads and check the confidence level.
• Teascalc is an Excel sheet that costs $49 but offers a both confidence and interval data.

Making The Grade

Everything we do to create and optimize paid search accounts is done in hopes of showing the right people the right ad at the right price.

Their reaction to our ads is feedback on how well we’ve done at targeting them and organizing our accounts as well as on how aligned our answers are to their questions.

Fortunately for us if we do things right – in setting goals, creating testable conditions, and accurately measuring and analyzing we can get this feedback in clear, powerful, and actionable form.

Text ad testing isn’t just another wise and important step in paid search management. It’s the crucial step that pays off all the others.

This blog post is part of a series extending and amplifying the ideas in our free ebook ’21 Secret Truths of High-Resolution PPC’.

What they’re saying: “Everything you know about AdWords is the basics Google wanted you to know. Just enough to get you hooked. But what if there was fundamental secrets that they neglected to share? Would you want to know them? Now you can! 21 Secrets Truths is what you must read, no, act on, before your competitors do.”

- Bryan Eisenberg Conversion Expert and New York Times Best-Selling Author ’.

Download Your Copy Today
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Related posts:

1. Secret Truth Series #17: Lament Of The Text Ad Copywriter Keywords and bids are over-rated, while search queries and text...
2. Best Practices and Text Ad Testing The Best Practices feature in ClickEquations can help you to...
3. The Secret Truth Series #3 – They’re Called Ad Groups This series of blog posts goes ‘behind the scenes’ to...

To use the report, you first set your targets. In the ‘Target ROI’ box you can enter the return-on-investment goals you want to check. First enter your actual target in cell X17 (labeled ‘Great’) and then enter your minimum acceptable ROI in cell X18 (labeled ‘Poor’).

Of course, these are subjective targets, but the point is to establish boundaries and find out how different aspects of your campaign are performing relative to these boundaries. By entering a value which we would consider ‘great’ and another one we would consider ‘poor’ we can find out how different components of our compaign are performing relative to these two markers.

With your targets set, simply click the ‘Refresh All’ button in the ClickEquations Analyst Pallete. Note that this is perhaps the most complicated of our reports in terms of collecting and analyzing a lot of data – so this one takes a while. Actual time will depend upon the size of your campaigns, but processing times of 10 minutes or more are not unusual.

When complete you’ll get data tables and graphs showing the analysis of your Google campaigns. The provided report doesn’t offer Yahoo or MSN versions yet, but you could modify the template yourself if you wish. Similarly, this report analyzes ROI – and ROAS version will be released in the future, or you could modify this one if you track ROAS rather than ROI.

In our example, we see that 23% of our campaigns have achieved or exceeded our top goal delivering a 1715% ROI average. Better yet, 1% of our spend is bringing in over 22% of our revenue. Those are productive campaigns.

Interestingly, only 2 of our campaigns are between our minimum and our target. Which leaves a whopping 29 campaigns, or 97% of our spend falling below our designated ‘poor’ ROI levels. The Ad Group analysis tells a similar story. We have some huge winners and a lot of sub-par performers.

Next Steps
The ROI distribution report provides perspective. It pulls you out of the trees of keywords and click-through-rates and gives you a sense of the forest where and how your money is being spent.

You may wind up running the report several times, adjusting the target values as you go, to find the goals which really represent what means ‘great’ and ‘poor’ to you. Armed with the final results, you can move back into ClickEquations itself and filter campaigns or ad groups by their ROI, displaying those falling into one grouping or another, and then diving in to analyze why they’re delivering their current performance levels and seeing if there is anything you can and should do to improve them.

In many cases, the immediate inclination when seeing how many campaigns or ad groups are under-performing is to consider shutting them down. If you need to immediately cut expenses or boost overall returns, this may be a good idea.

But more typically the metrics you get at the campaign and ad group level represent the average of too many bundled keywords, of too many different text ads, and too much diversity of match types and search queries.

You have to take the time to dive into the ad groups to see which keywords or text ads are really causing the poor performance. Over time, however, it is true that better ad group and campaign organization can help to make these numbers more actionable.

How It’s Built
One somewhat technical point about how the ROI distribution report is built using ClickEquations Analyst is worth noting. This report uses a very powerful feature of Analyst, which is the ability to ‘Aggregate’ data rather than just gather it.

This report is not built by pulling all the individual campaign or ad group performances into Excel and then doing a lot of calculations. Rather we simply tell Analyst that we want it to aggregate the data – counting how many campaigns hit a certain criteria and summing up their expenses and revenues.

The ability to have ClickEquations Analyst do data aggregation as pulls data into Excel make a wide range of analysis reports and dashboards very easy to define and create.

Related posts:

1. Avinash Revisited – Part I (Keywords by Engine) Recently our friend and advisor Avinash Kaushik wrote a blog...
2. Avinash Revisited – Part II (What’s Changed?) Last week in Occam’s Razor, Avinash Kaushik discussed our ‘What’s...
3. Avinash Revisited – Part V – Query Reports The fifth ClickEquations report featured in Avinash Kaushik’s recent blog...

Shane gave a great presentation on creative approaches to writing ad copy, and David shared his broad knowledge including a focus on how ads and ad copy needs to be different on the content network.

I focused on three aspects of success with text ads:

1. Organize campaigns so the ads are seen by the right people.
2. Develop recipes for your ad copy to help you test for different triggers.
3. Conduct formal tests to find dramatic CTR improvements.

Improvements in text ad performance -- meaning higher click-through-rates -are within reach of every paid search advertisers. With a simple approach and a little effort, you can drive up CTR by 2x-4x or more, which brings a lot of advantages:

• Higher Quality Score
• Lower Cost-Per-Click
• Better Impression Share
• Higher Positions

Hopefully this 10-minute presentation will provide some insights, and inspire you to spend some time improving your text ads:

www.youtube.com/watch?v=yNITcjQo97w

Related posts:

1. Best Practices and Text Ad Testing The Best Practices feature in ClickEquations can help you to...
2. Secret Truth Series #18: Effective Text Ad Testing Text ads are trying to answer questions. Writing text ads...
3. What If Your Text-Ads Had 5 Landing Pages? Proving that the future will be ever-more interesting, Google has...