Why the AdWords Opportunities Tab Is a Great Opportunity ... for Google
Within the Google AdWords interface there are some awesome tools, like:
These controls are fantastic power tools for power users that allow for a lot of great campaign optimization tactics.
Some other tools inside the AdWords interface either aren't so useful, are hidden from view, or can have a dubious overall impact on your campaigns -- like the hard to find IP exclusion tool and conversion-focused bidding options like Enhanced CPC and AdWords Conversion Optimizer, which can generate terrific improvements in many cases but force advertisers to cede control of their bids to Google.
A great example of a tool that falls into this second category is the AdWords opportunities tab. The opportunities tab is billed as a chance for advertisers to identify different ways to get more out of their AdWords campaigns, but for novice advertisers it can wind up being more of an opportunity for Google to increase AdWords revenues than for the small business to increase theirs.
Default Settings Are Rarely Your Friend
As with settings like optimizing ad text rather than rotating, automated bids, or expanded broad match, if left unchecked and not used thoughtfully these default campaign settings can lead to a steep AdWords ignorance tax. Google wants happy advertisers, but they also want to drive more clicks on paid search ads whenever possible. This is evident in the default view in the opportunities tab:
Click the image to enlarge, but the basic idea is that the first problem Google is trying to solve for you is a lack of clicks, not a lack of conversions or revenues and profits for your business. They do this by:
- Encouraging you to increase budget - In many instances this will actually make sense, as if your campaign is driving cost-efficient conversions for your business you'll want more of that traffic, but the interface doesn't exactly remind you to check the profitability of the campaign before raising budgets :).
- Encouraging you to bid more - More money for Google, but possibly a net loss for you as an increase in budget isn't always representative of the most efficient frontier on the paid search bidding spectrum.
- Encouraging you to add keywords - Google is also careful to suggest expansion opportunities at the keyword level so that you can add these to your campaign.
Now for profitable campaigns raising budget may make sense. And some of the keyword expansion opportunities may be great ideas. But the reality is if these instructions are followed blindly, the advertiser may see clicks skyrocket and cost per conversion jump right along with it.
The good news is that, like with many things in the AdWords interface, the default treatment focuses on an increase in clicks, but there is an option that allows you to make decisions that are better aligned with the advertiser's interest -- like the option to look for suggestions that maintain or decrease cost. Remembering how many ideas Google had to help us spend more money above, let's see what they can do if we want to cut costs:
Despite having all the data Google doesn't have any ideas to help us lower our AdWords spend :).
It's worth noting, of course, that this is just one campaign and that the AdWords opportunities tab does make suggestions (some likely helpful) on how to decrease costs.
Automated Opportunities Not Enough?
The problem with suggestions from this "optimization specialist" is that:
- They don't understand any of the nuances of my business and aren't interacting with me as an advertiser (their recommendations are purely data-driven).
- They aren't familiar with my margins or my real-life business goals beyond what I typed in as a target CPA.
- They work for the company that wanted to get me as many clicks as possible and couldn't come up with a single idea for how to cut costs. :)
So What Does All this Mean? Why Should You Care About Google's Opportunities Tab?
I think the opportunities tab is important for two reasons:
- It's emblematic of Google's approach to creating the AdWords interface: it has some interesting and powerful features (the quality suggestions mixed in with the Google-friendly ones, the Analyze the Competition feature).
- It's important to understand the pros and cons associated with leveraging tools like the opportunities tab.
For some advertisers, relentlessly analyzing every new AdWords feature to determine how it can help them convert more prospects and grow their business is second nature, but for others the controls available in AdWords are overwhelming, and seemingly helpful suggestions look like a life preserver -- therefore it's important to encourage new users of the AdWords interface to think strategically about how they leverage the opportunities surrounding Google's paid search platform. If you're new to AdWords and wondering how you can avoid similar pitfalls, I'd encourage you to:
- Read PPC blogs and eBooks like this one and those written by our friends at PPC Hero, Click Equations, the PPC Prospector Blog, and others.
- Build relationships with PPC experts (you'll be surprised how active they are and how much they'll be willing to help and share).
- Consider a do-it-yourself training course like PPC Blog's or Brad Geddes' Certified Knowledge so that you can gain a thorough understanding of how AdWords works and consistently access expert advice as new features are rolled out.
- Invest in paid search marketing services and training (either with an agency or something like the WordStream JumpStart program) so that you can have access to a professional who will understand your business and stay on top of trends for you.
- Invest in AdWords software like WordStream, Boost CTR, and others that are designed to help you grow your business (not Google's) -- bonus points if they're available to try for free :).
But whichever route you take for next steps, be sure to constantly question the default settings in your AdWords accounts and focus on the metrics and tactics that will help you grow profits.