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How Much Money Are You Wasting in Google Ads?

You can waste a lot of money in Google Ads if you don't know what you're doing.

How Much Money Are You Wasting in Google Ads?

June 12, 2020 Posted by Tim Ito Uncategorized

You might ask why we preface the question as “how much” versus “are you.” Well, first there’s the issue of click fraud. Roughly 14 percent of all clicks from search are fraudulent. That’s right. 14 percent of the traffic you’re getting through your ads are from bots or click farms. According to recent data from CHEQ and the University of Baltimore, that’s $30 billion of fraud committed every year. And it’s expected to go to $50 billion by 2022. If you consider the downstream effects of fraudulent clicks – creating lookalikes or retargeting based on fake traffic – the amount of money you’re wasting is probably even higher.

That’s a big problem in itself. But for the purposes of this, let’s focus on the other 86 percent of traffic from ads. How much of that traffic is valid? If you’re not careful about Google Ads in search, even more of that traffic will be irrelevant.

To illustrate this, consider the most basic type of keyword matching – broad match. How broad is a broad match? It’s so broad in most cases you might not recognize the search terms your ad is actually showing up on unless you analyze the data after the fact. For example, let’s say your company does corporate training and you create a campaign and do a broad match on something simple such as “training.” (Don’t do this, by the way, it’s just a more extreme example.) And, you set a particular budget for it. If you’re not more specific in the way you define or narrow the type of searches you’ll show up on, you’ll most certainly find your ad showing up on terms such as “weight training,” “athletic training,” “training shoes” or any number of unrelated searches. And if you’re ad copy isn’t so specific, people just might click it wondering if it’s relevant to them, or even by accident.

One example: The other day I was searching for “training delivery,” which is a relevant corporate training term. Here’s one of the ads that showed up:

So, Wegmans (a grocery chain advertising its food delivery), showed up on a term for “training delivery.” Not having access to the account, it’s hard to tell what exactly Wegmans was buying other than the term “delivery” and at what point in the process the ad was being displayed but the company’s marketers clearly didn’t intend to show up on this term.

Start Broad and Narrow the Keyword Matching

The example brings up a good point. What we often see in paid search is that companies run into trouble a.) When they don’t have a strategy and; b.) When they aren’t vigilant in applying negative matches to their buys at the campaign and account level. Let’s take each of these separately.

Strategy is critical in that the keywords a company buys should inevitably reflect a plan of some kind, and be based on what stage of the buyer journey a marketer is targeting. For many companies, paid search in particular is used as a lower-funnel mechanism to maximize conversions. That’s because it’s one of the main digital marketing areas where you can see user intent. But even if conversion is the focus, it’s important to first figure out what terms potential and current customers are using to find your products and services. So, it’s OK to start broad. After all, how would you know all the terms every customer will use to find you, or maybe some customers will discover you because they happened to do a search for one thing and they end up seeing your ad, and liking what you have to offer.

That’s why we recommend starting broad in your campaign and narrowing to more exact matches and specific terms based on what’s performing. But, if you’re starting broad, it’s also important to start apply negatives and applying them right away. Because that’s where companies often lose money.

Apply a Negative Match

Hence, in the case above with Wegmans, perhaps the company’s marketers were still testing a broader start to the campaign in figuring out what relevant terms to combine with the word “delivery.” But soon after, they needed to realize what was going on, and should’ve moved more quickly to apply the negatives matches. In other words, it’s not a big leap to assume the company doesn’t want to show up on “training delivery” but they want food delivery-related search terms. So, they should apply a negative to the word “training” with their buy immediately because it’s not relevant term to what was being searched for. That’s the one caveat with starting broad – there might be hundreds of combinations of terms that might be used around a particular keyword so it’s important to apply negatives early to stop irrelevant ones from sinking ROI. This might seem to be common sense, but so many companies let this slide and aren’t vigilant about the terms they show up on.

 

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Adding Layers to Your Campaigns

Another way to avoid excess costs and make sure your ads are getting in front of the right people is to layer campaigns – in other words, use multiple criteria and not just keyword matching for determining whether or not to show an ad to someone. One way to layer is to only show some ads to people who have visited your website. Another way is to focus certain ads on those who might have particular titles that fit your target audience. Regardless of the method you choose, the bottom line is that you want to show your ads to the right people at the right time. And the more exact you can get toward that goal, the more efficient your campaigns will be.

Control Where Your Ads Are Showing

Google Ads show on all devices, computers, tablets, mobile, and even TV screens. And many companies combine their search and display efforts. If you are running Google display, go into the campaign metrics to identify which device is getting the most clicks and figure out how relevant those are. In our experience with Google Ads, mobile apps end up getting most of the display advertising. If you are a B2B SaaS product and you’re looking to get free trial, showing ads with app games is not going to be the most relevant for you. So, check the device targeting and the ad placements to identify the appropriate locations where you would like to show your promotion.

Conclusion

Who benefits from irrelevant clicks? Well, Google does. Google now makes it so easy for companies to launch ads with just a few clicks that it might be tempting for some just to dive right in. However, many companies end up wasting money on the campaigns without getting any returns because they don’t understand the nuances of the tool. The only company benefitting from this is Google. (It’s one reason the company has a valuation of more than a trillion dollars.) They also benefit from fraudulent clicks though there is some evidence they are trying to tackle this problem more seriously. And there are tools now that companies can use to alert Google to evidence of fraudulent behavior, particularly for those organizations that have larger spends.

That said, as a marketer, it can’t be emphasized enough that your role is not only to maximize conversions and revenue, it’s also be a good steward of your marketing investment and limit the amount of wasted spending and irrelevant clicks. There will always be some – and that’s not a terrible thing if you’re learning more about how customers search for things. But it is a problem if you don’t keep optimizing and adjusting your campaigns to stop spending on terms and placements that don’t make sense.

At Marketing Nice Guys, we offer a professional paid media audit that will analyze your campaigns and provide recommendations to improve them. Contact us to schedule a training or customize an virtual or in-person event to your needs.

Tags: AdWordsclick fraudFraudulent clicksGoogle Adspaid mediapaid search
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About Tim Ito

Tim is the co-founder of Marketing Nice Guys. Having more than 25 years of experience developing content, optimizing websites, and running marketing for various organizations, he has particular insight into the challenges faced by companies and their marketing departments. He currently also co-manages the jobs and community site, Find My Marketer. Previous to Marketing Nice guys, he served as a vice president at the Association for Talent Development (ATD), overseeing the content and digital marketing division. His career has also included stints at ASCD, America Online, Netscape, and AltaVista in content, marketing and product strategy lead roles. Tim started his career as a journalist, as a former senior editor and producer at washingtonpost.com and as a reporter and writer for U.S. News & World Report magazine. He is the co-author of The B.S. Dictionary: Uncovering the Origins and True Meanings of Business Speak (April 2020), with Bob Wiltfong. Since 2015, he has also served as an adjunct professor of a popular digital marketing course at Georgetown University.

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