So PPC doesn't work... :-)

[Annoying Donkey]

I find this interesting...
http://www.slate.com/articles/busin..._ads_did_ebay_just_prove_they_don_t_work.html

The study—by eBay Research Labs economists Thomas Blake, Chris Nosko, and Steve Tadelis—analyzed eBay sales after shutting down purchases of search ads on Google and elsewhere, while maintaining a control set of regions where search ads continued unchanged.* Their findings suggest that many paid ads generate virtually noincrease in sales, and even for ones that do, the sales benefits are far eclipsed by the cost of the ads themselves.

We don't use PPC for our own sites. Our own ecommerce sites have seen increasing competition from PPC ads, yet we've seen no decrease in sales.

 

[MASSEY]

Is Ebay a good example to use? I see ads for ebay and amazon pop up for searches that are barely even related to some of the searches i do. Their ppc stance appears to be appear for anything and everything, having so many products to sell i would imagine it is difficult to keep things tight and keep cpc down.

What sort of things do you sell weblink?

 

[DPOM]

Yeah this blew up a while ago, the thing is, eBay did an INCREDIBLY bad job of it particularly by using dynamic keyword insertion. For example if you searched Google for "Love" you'd find an eBay ad that read something like:

Buy Love on eBay
Buy it Cheap on eBay
etc etc etc

And they wondered why they weren't getting on too well.

This is an interesting blog post that explains more.

 

[Chris Ashdown]

What a load of rubbish using a term like Ebay and expecting results, any market leader would probably get the same result, if your name is the market leader then why would anyone look for you in the PPC area as you would show up just below it anyway

Apart from local area searches then small companies will always do better at sales using PPC it's just a matter of getting PPC to really work for you and the same for SEO poor work in = poor results and the small guy cannot afford to play with the big guys who have larger budgets in most cases

 

[JonathanSEO]

What a load of rubbish using a term like Ebay and expecting results, any market leader would probably get the same result, if your name is the market leader then why would anyone look for you in the PPC area as you would show up just below it anyway

Brand name PPC campaigns are extremely profitable for a number of reasons.

Nobody consciously think oh they are a market leader, bet they're not bidding on their own keyword so I won't look lots of people don't even know the difference between Ads & Organic!

Wait till somebody starts bidding on your brand name and see how many clicks they steal

 

[Annoying Donkey]

Buy Love on eBay
Buy it Cheap on eBay
etc etc etc

And do you know how many clicked through on this particular ad and never bought anything...? If nobody clicks through it doesn't cost them anything and wouldn't show up as a cost on the analytics. With millions of keywords, I can see that ones like this would be missed especially if there was little/no cost involved.

I need to read the actual report to really comment further, but they do mention that the cost of PPC for non brand keywords was too high. This indicates that they do have the nonce to measure the ROI.

I've done little SEO on my sites over the last couple of years, giving me 'free' advertising during that period. Obviously I put in time to get them ranking in the first place, but if I had've focused on PPC, then I'd have been paying for advertising all through that period. And lower costs can mean just as much to the bottom line as extra sales...

 

[DPOM]

No idea, but it would certainly get clicks and obviously the performance of the ad is going to be horrible so the clicks they do get will be costing them much more than they should...scale that up over potentially thousands of keywords and they've been throwing money down the toilet.

 

[Annoying Donkey]

No idea, but it would certainly get clicks and obviously the performance of the ad is going to be horrible so the clicks they do get will be costing them much more than they should...scale that up over potentially thousands of keywords and they've been throwing money down the toilet.

So your argument is based on assumptions...

 

[DPOM]

In part of course! (we'll never know to what extent) But, if the ads (like the above) are showing they'll be getting clicks and its not an assumption when I say a badly performing ad can lead to a lot of wasted spend.

 

[Annoying Donkey]

they'll be getting clicks and its not an assumption when I say a badly performing ad can lead to a lot of wasted spend.

They may well be getting some clicks, but with millions of keywords the cost of those clicks is perhaps insignificant overall. cpc on Love is 29p so at the bottom of the scale. I'm not convinced many people would click on an ebay ad in response to a search for love. Are there really any cheapskates searching for love on ebay

As for 'thousands of keywords' like that, pure speculation. The report specifically mentions they were looking at the ROI on non brand keywords.

 

[DPOM]

So you assume

A million times .29 is still a lot of money assuming each of those million keywords only got 1 click. It still mounts up.

(im assuming again!)

It's Dynamic Keyword Insertion anyway and they'll fall under non branded of course.

 

[DPOM]

TBH, I wouldnt put it past some to try and buy love on ebay..perhaps ill put up a listing and see how we go...

 

[directmarketingadvice]

Ebay's strategy seemed to be to bid low and bid on everything. (I've heard rumours of a deal with google where they got preferential treatment in order to show ads for non-commercial searches.)

There are 2 problems with the "bid low on everything" strategy:

(1) As others have said, they had ads showing that made no sense and, had you clicked on them, would have taken you to a landing page that had nothing you'd be interested in.

(2) When you bid low, you tend to get impressions for non-commercial/non-converting keywords. That's why, if you lower your bids, your cost per conversion goes up - you lose your best-converting ad impressions/positions and keep the worse ones.

Steve

 

[laowang101]

Actually the cpc is easy to be manipulated by people. I am curious why people waste the money on it. I prefer to do seo work rather than CPC

 

[adambrody]

The campaign after being properly implemented, will give you the luxury of reaching qualified prospects. You just need to have advanced pay per click management which is able to present your ads and sponsored links in a highly dedicated, effective and innovative manner. An experienced and expert ad campaigner makes it sure that the prospect buyer has got the right platform. After all, expert trainer by using sophisticated tools help in improving the rate of your lead generations.

 

[seowise]

It really depends on your keywords and your PPC skills, though the study is interesting.

My apologies for being Captain Obvious, but there's one simple formula to figure out if PPC works or not: PPC bids should be less than Revenue per visit

PPC bids < Revenue per visit

Also if Google AdWords seem not to be working for you, try Bing Ads. From my experience, the traffic is really of high quality and the bids are a bit lower for the same keywords.

 

[Shelly Watson]

We have been using Google Adwords for several months, and have seen no growth on sales. We are adjusting our keywords based on the referral traffic. Maybe we need more time to see effects. I think PPC should be an effective methods to bring traffic and leads.

 

[directmarketingadvice]

We have been using Google Adwords for several months, and have seen no growth on sales. We are adjusting our keywords based on the referral traffic. Maybe we need more time to see effects.

You shouldn't do.

If you're measuring leads/sales properly and you're not seeing an increase from PPC, something is wrong.

(Assuming you've had enough traffic to give you a meaningful sample - e.g. for a site with a conversion rate of 1%, you'd need no conversions from 300 visitors in order to demonstrate you're not getting 1% conversions.)

My question would be whether "cold" organic traffic converts - i.e. SEO traffic from keywords that have nothing to do with the name of your company.

Steve

 

[PPC_Matt]

That eBay test was crap - their whole strategy was terrible for the start. No wonder it didn't work for them!

 

[jamesfranklin128]

Who said P.P.C does not work, there are many businesses which are depending on P.P.C .

 

[Tim R-T-C]

They may well be getting some clicks, but with millions of keywords the cost of those clicks is perhaps insignificant overall. cpc on Love is 29p so at the bottom of the scale. I'm not convinced many people would click on an ebay ad in response to a search for love. Are there really any cheapskates searching for love on ebay

Lets be honest - it was never going to be profitable for eBay to advertise love as it can't be bought with money...

 

[Annoying Donkey]

Lets be honest - it was never going to be profitable for eBay to advertise love as it can't be bought with money...

Take a look at Bernie Ecclestone's wife and tell me that money can't buy love!