Google is synonymous with change. So it may have come as no surprise that on August 29th, the company rolled out yet another change to their online advertisement settings, specifically with ad rotation. The real question is — what does this new change mean for you, your ad budget and your ad performance?
Google isn’t one to give a plethora of details when they make such changes, leaving many companies feeling in the dark as how to proceed. How will this new change really effect your advertising?
What to Expect This Fall: Enhanced Algorithms
When it comes to its ever-mysterious algorithms, Google referenced a heavier focus on machine learning, which is exactly what it sounds like. According to Google, this new method will create better data for determining which ads are most relevant. Machine learning is both strong and effective, but because it’s still a relatively new concept, it’s not without its flaws — for instance, Google recently confused the abbreviation “hp” (short for horsepower) as referencing the corporate giant Hewlett Packard (HP), consequently blocking some “hp” ads on the assumption of trademark infringement.
With such mistakes still occurring, there’s no need to become too frightened by the “rise of the machine” — at least not yet. What we should be aware of, however, is how this “machine learning” may be (negatively) affecting your ad performance (higher clicks, lower conversion) while financially benefiting Google.
Google’s Notification, Explained
In Google’s August 29th email to all AdWords customers, they noted that there will now only be two ad rotation options available: “optimize” and “rotate indefinitely.” Optimize, they say, will use machine learning to produce ads that are predicted to have better performance than others in your campaign, while “rotate indefinitely” option requires little explanation — ads will be evenly displayed, indefinitely.
While this seems initially clear, it actually raises a number of uncertainties: the first being, in reference to the “optimize” setting, what exactly is being optimized? There are many potentially-optimizable factors in any given AdWords campaign, and they all matter — ranging from the ad price, the number of clicks, rate of conversion, or ROI — all of which bring unique aftermaths for ad placement, achievement, and overall success.
We wanted answers, and we wanted them now. So we picked up the phone and called Google. Their answer? Optimize is a subject word, dependent on the specific network being utilized: Search versus Display (note: the Search Network is the text ads showing up on google searches, while the Display ads are image advertisements displayed across the Internet). We learned that the only factor optimized in the Search Network is clicks, which wasn’t great news. They claimed to be optimizing conversions for Display ads, however.
Our first thought? For the search, this doesn’t make a ton of sense. Why? Because the Google Search Network is known for bringing a large number of leads (click optimization has been correlated with only more site visits and more costs). For the Display Network, however, this could be a good thing. Display ads currently are known for having substantially lower conversion rates, their true benefit stemming from bringing an increase in brand awareness, which brings the risk of paying a lot for clicks for very few conversions. So, if the optimized conversions mean a more successful Display Network, this is a positive outcome — but actions speak louder than words, so this is something we’ll be closely monitoring.
How Your Company Should Handle These Updates
As with anything in life, it’s hard to truly shake something that’s built with a strong base. The same applies to Google’s new AdWords updates. If you already have a good-quality ad campaign, it’s not going to be destroyed. But there are a few steps you can take to ensure your ads fare is as well as possible in the pending changes.
The first of these is to take a second glance at your campaign’s bidding strategy. There are many bidding features in AdWords that should be taken advantage of to ensure a successful campaign, especially now that the data from such bidding strategies will be utilized even more by the coming “machine learning.” Such features include enhanced cost-per-click, target return-on-ad-spend, maximized conversions, or target cost-per-acquisition.
Another factor to consider is how often your campaigns are being reviewed by an actual person for quality and accuracy. This is necessary in order to weed out the low-performing ads and to further enhance the high-performing ones (ones with low conversion costs, high click-through-rates, and best ROAS). Play around with your ad’s wording to see what truly resonates with your target audience. Regularly try a few A/B tests to see which tactics are the most successful, but do so while keeping the high-success ads up and running at all times.
These manual reviews are only effective, however, if they’re done on a very regular basis. Consistency is key when cultivating a successful AdWords campaign. If you don’t check the account regularly, you could completely miss red flags that are severely harming the ad group’s success rate. Further, local events (natural disasters, civil unrest — what haven’t we seen lately?) could have an impact on your ads’ performance. You must stay on top of these changes.
In summary, this isn’t the first time Google has thrown something like this at advertisers, and it probably won’t be the last. While it’s not a cause for panic, you should take Google’s advice to refrain from taking action with a grain of salt — because it’ll be those playing offense that fare the best in the coming months.
If you have an external agency in charge of your account, they should already be making plans for how to combat this update and make the best of it. The team at Techwood Consulting understands that Google’s updates can have serious implications, and they will continue monitoring them daily. Don’t wait until it’s too late — make sure you’re working with an agency that will ensure your ads will be ready for the coming changes today.