What’s your strategy for setting up your campaign budgets? One of our clients shared a case study with me about how he restructured his campaigns and budgeting strategy by combining the popular 80-20 Rule and the English soccer league system. Using this structure, he was able to improve his metrics across the board.
Let’s take a closer look at his account restructuring plan and execution to see what lessons we can learn.
The 80-20 Rule (more formally named the Pareto principle) states that roughly 80% of the effects come from 20% of the causes. Our client was seeing a similar ratio of cause to effect with the performance of his account: 20% of keywords and ad groups were bringing in about 80% of impressions, clicks, and conversions.
Soccer League Tiers
Our client also used the soccer league tier system in England as a basis for how the account would be structured. For those of you who aren’t familiar, there are several tiers of leagues for club teams. The top league in England, called the Premier League, houses 20 teams. These teams are the best of the best. Underneath the Premier League is the First Division (it’s actually called The Championship but that makes things more confusing). These teams are a step below the teams in the Premier League.
Also, every year the very best soccer clubs across a variety of European nations and leagues get together to play in a tournament called the Champions League.
The Campaign Organization Plan
Our client used these principles when structuring his campaigns. The account had three types of campaigns:
Premier League Campaign: Primary Campaign
This is a geographically targeted campaign that contains ad groups specifically targeting the 20% of ad groups and keywords that bring in 80% of impressions (and other PPC metrics). This campaign will have the largest budget – at an 80%/20% ratio with the First Division Campaign below it.
First Division Campaign: Secondary Campaign
This is a geographically targeted campaign that contains the rest of the ad groups and keywords outside the top 20% – this contained ad groups for the locations that did not receive as many clicks or conversions. In the real life soccer leagues, teams can move between the leagues by promotion and relegation. Our client used “promotions” and “relegations” to pause or enable keywords or ad groups between the two campaigns.
Champions League Campaign
As the Champions League in soccer pulls in teams from a wide variety of nations (as opposed to the Premier League and First Division which only draw teams from one nation), the plan for the Champions League campaign was to have a more general campaign that was targeted to potential areas not targeted by the other campaigns within the country. This campaign could pull in other potential queries from other locations not targeted by the other campaigns. However, the ad groups, keywords, and ad text that are part of this campaign will have geographic specific terms to let users know where the physical locations are. This campaign would have the smallest budget.
Execution of the Plan
Our client started implementing the plan he laid out, but learned that there were several factors to consider that changed his original outline:
1. Using the 80-20 rule, our client focused on setting his Premier League campaign to target the locations that had the best response rate and were generating the most business. The First Division campaign was used to target locations that were not performing as well.
2. Our client told me that geographic targeting in his country is not quite as effective as it is in the USA. To tackle this issue, he focused less on the geographic targeting options at the campaign level and used more keywords that had geographic terms to refine his ad impressions. If I were running a similar campaign in the USA, I would lean more on geographic campaign targeting than he did.
3. The Champions League campaign wasn’t quite as successful as originally planned. Realizing that, our client decided to use this campaign for other purposes, such as experimenting with new ideas, or running special offers through the campaign.
What are some key takeaways from looking at this account restructuring?
1. Use a Plan – Our client put significant thought into his campaigns before he even started touching AdWords. By documenting his plan, he was able to maintain solid organization as he was restructuring. Also, through documentation, he could easily bring other people (like the WordStream Customer Success Team) up to speed with his goals. Don’t be afraid to have a bit of fun with your plan! Because our client got creative with his terminology, it made it easier to remember how things were structured and it also helped him explain the concepts to me as well. He also came up with a way to name each of the different groups and campaigns something unique, but stuck to a consistent naming pattern that made it easy to understand. These methods helped him reign in his large account structure.
2. Experiment – One of the main successes in the case study is how the client used experimentation to implement his plan – and to figure out when to ditch his original plan. In using a portion of his budget to test new ideas, our client was able to incorporate those successful ideas into the main structure of his account. One of the great aspects of AdWords as a marketing tool is the data that it provides. Everyone can use this data on some level – whether it’s A/B testing ads against each other or using a part of the budget to test new marketing concepts.
3. Know Your Environment – Make sure you understand the environment you’re operating in, in the “real world” and in AdWords. In the case here, our client found out that location targeting options weren’t sufficient for him so he needed to take control into his own hands by adjusting his keywords. Knowing your environment also means understanding features and options within AdWords that you can use to your advantage.
4. Don’t Marry Yourself To Best Practices – Best practices are there as guidelines, and oftentimes they will help you be more successful, but you don’t need to always follow them to a T. Our client could have followed a best practice of splitting his campaigns up by location and using location targeting, but by using data through experimenting, he found that he could target better, and manage his account easier, by using a slightly different structure where location was targeted through keywords on the ad group level.
5. Sometimes You Need a Big Overhaul – The complete restructure of this client’s campaign took significant effort, but it paid off for him with lower CPAs as he was able to improve and optimize his campaigns.
6. Use available tools – Here is a direct quote from the client: “The real game changer was Wordstream, without it the fine tuning would have been an enormous task. Indeed I suspect I would have had to produce my own Access/Excel solution to crunch the volumes of data.” If you're not a WordStream customer, take advantage of the tools available to you to make your restructuring easier.