Our Pay Per Click Marketing five-part blog series distills the EducationDynamics approach to Paid Search. These are the practices that put us consistently #1 in Auction Insights for EDU. You might like some concepts and you may disagree with some. Either way, this overview will help demystify PPC for you, and aid in making better decisions with your media spend moving forward. To dig in deeper on each topic in our five sections you can download the full eBook: The Essentials of PPC Marketing in Higher Ed now!
Part Four: Leverage Rising CPCs
As CPCs rise, matches become more liberal. That’s because there are three* main components to Google Quality Score:
Expected Clickthrough Rate: The likelihood your ad will be clicked
Ad Relevance: How closely your ad matches a searcher’s intent
Landing Page Experience: Your page’s relevance, transparency and ease-of-navigation
So, if your CPCs go up, you are more likely to win auctions, even when it doesn’t seem plausible. Let’s revisit our Ad Rank formula:
Ad Rank = Quality Score x Max CPC
As Max CPC goes up, your Ad Rank goes up, so you will win more auctions, all other things held equal. Your Quality Score has Expected Clickthrough Rate and Ad Relevance components. But even a low Quality Score can be overcome by a high enough bid. Understanding these relationships very specifically is essential for PPC marketing in education for two reasons:
Leads themselves have little to no cost – the COGS in this industry are generally a function of media cost
As a corollary, some EDU keywords are particularly expensive
Let’s break these two elements down. Imagine you were to apply the PPC marketing principles here to another industry, like luxury hair care. Imagine yourself a beauty retailer tasked with selling flat irons, curling irons, or imported shampoo. Such a business would have many costs that do not exist in EDU marketing. In order to sell a curling iron, you (theoretically) first have to buy a curling iron. Imagine you purchase a curling iron at a $50 price and sell it for $100. All your profit exists in the $50 between your sale price and the cost of the curling iron. You’ll commit capital to acquire curling irons, as well as housing then shipping them (assuming you offer free shipping) to consumers. All such costs are present before you buy a single click from Google or Bing. Industries with hard goods and costs typically have much lower cost-per-conversion than lead generation, even though you “actually get something.” This is not intuitive.
Lead Generation versus Other Industries
Lead generation (EDU or otherwise) typically moves small bits of data—name and phone number, an email address or area of interest–from student to school. Maybe the intermediary is a search engine or a call center or other partner. But we don’t have to physically store the lead or ship it to the relevant college or university. Intuitively the value of that small piece of data should be lower than a curling iron—bundled with surprisingly space age technologies or bound with rare metals—but the value of a potential student down the road is many times greater than just a lead. More on that in Part V of the ebook. Everybody knows this—“everybody” being defined as all those who bid on EDU keywords for Google or other search engines. The net result is that money typically bound up in ceramics, titanium, warehouses, fulfillment operations, and shipping is instead, added to the search engine media cost. That’s why new advertisers so often see messages like this one:
$109 dollars!?! $109 dollars per click? How can you even get a $50 cost per lead if you are paying $100+ per click? You can’t. New advertisers can’t, anyway. Google often charges established advertisers with high Quality Scores far less for the same keywords. To wit:
This section is not a diatribe against high CPCs, though. Advertisers simply pay high CPCs for some keywords. Yet some advertisers (with high Quality Scores) outperform the heavy-pocketed cowboys. Rather, for EDU advertisers, this is a mere caution. Because CPC estimates can be very high, especially for new advertisers, you must know what you’re getting into. This is a warning not to incinerate your budget before getting workable data, results, or certainly students. When I was new to EducationDynamics, I kicked down the door, armed with my knowledge of rational bidding and overhauled both keywords and CPCs top-to-bottom, almost in the first week. We didn’t have a ton of historical data, but part of the reason was we just weren’t winning auctions. Our Max CPCs weren’t high enough. There was only one way to fix that, right? I learned an expensive lesson about keyword relevance. Two such keywords in particular: +online +class Unbeknownst to our buyer, a blockbuster superhero film came out that would throw a wrench into our buy using these keywords. More than 40 variations of watching X-Men: First Class were present in our search terms! Not crazily inefficient, but $10-$14 per click, each. Each! watch x-men first class online x men first class free online watch x-men first class online for free x men first class online free x men first class online watch etc. Note the bolds. It was just a spot of bad luck. We addressed this by adding anti-X-Men negative keywords. For more examples and take-away on how to leverage rising CPCs in PPC Marketing check out our ebook here. *https://support.google.com/adwords/answer/6167118