"The Desktop Global Marketer" (tm)

   A free on-line newsletter of Sidereal Designs, Inc.,
   for Internet Entrepreneurs, and those who are
   considering becoming one.
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                   August 2001

In this issue: "I launched my ad campaign and anxiously
monitored the first twenty four hours. Something was
obviously dreadfully wrong."

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I recently decided to see how much could be done for how
little with a paid ad on the web, something I've never done
before. This issue reveals what I learned. It's going to be
a bit on the long side, but if you're contemplating doing
this I think you'll find it valuable. 

For some reason August is always a rotten month for selling
web sites; maybe everyone is away at the beach, but it's a
good month for me to work on my own site.

I had already worked on my search engine rankings
recently. I paid $800 for a program that knows all about
each engine's preferences for everything right down to the
number of words on a page. I worked really hard at changing
things around, playing with word positions until I was blue
in the face, and finally broke into the top thirty on three
major engines for some really relevant keywords. Would you
believe 12th place on Yahoo for "web design?" Would you 
believe sixth place on Google for "web designers?"

The net result? Not very much. Search engines really don't
account for as much traffic as some vested interests want
you to believe. I've seen one independent source estimate 
six percent.

So I decided to devote the rest of August to investigating 
paid advertising on the web as a source of traffic.

I decided I wanted very targeted ads - the ones that get
shown only to people who are likely looking for your
product. Banner ads on general-interest, high-traffic sites
don't fill the bill there. Also recent research suggests
they're not very effective.

I thought about ads on more focused sites that my clients
would frequent, but what sites are those? Good question. 

People who want a web site may be in any sort of
business or profession; no telling where they'll show
up. People who frequent sites about web sites are more
likely my competition than my clients.

You can "buy" keywords on many major search engines and have
your banner ad thrust on those who search on them, but in
general it's pretty expensive. I didn't want to spend a lot.

GoTO lets you bid on keywords, but they show who's bidding
how much and I saw my rich competitors were bidding $2.50
per click-through for key phrases I wanted. Ugh!

Finally I found Google's "AdWords" program. If you're not
familiar yet with Google, you should be. It's the best
search engine in terms of finding what you want, and it's
beating the pants off things like AltaVista in terms of
traffic growth. Check it out at google.com.

They have a neat little plan. You give them a sum of money
to launch an ad campaign: whatever sum you like. You can
then designate as many key-phrases (including negative ones
to be excluded) as you wish; You can specify languages and
countries and other restrictions on the viewers. When a
visitor matching your criteria searches on your designated
keywords your ad is shown and your account is debited. When
your money is used up you can replenish it or quit. You only
pay for actual selected viewers actually getting shown your
ad, and you select how much you're going to spend.

They're clean and honest about it unlike some places. The
ads are neat little boxes off to the side of the page and
not disguised as search results as so many engines do (which
is pretty dishonest to the users performing a search for
something.)

They put up to eight ads on a page of returns. You pay
according to how high your ad places on the page. How high
that is is determined by how popular your ad is. The more
clicks it gets, the higher it places.

All the ads look alike - no graphics, a title and two short
lines of text. You're going to have to be creative here to
put yours above the competition.

What I really liked however was all the feedback they give
you. You can track your ad campaign and see at any moment
how many people are hitting each of your keywords, what
position your ad is in when they do, how many people have
clicked on it under each of those conditions and so on. You
can really fine-tune your selections and play with the
wording of your ad and watch the effects change. You can
modify anything at any point in your campaign.

Also nice: as you're setting up your campaign you can enter
prospective keywords and see, based on their past experience
of frequency, how frequently your ad can be expected to show
and how long your money is estimated to last; all before you
even launch your ad. You can play with this as long as you
like before you actually commit. They have put a lot of
thought into this.

I decided to try it, but first to combine it with a little
analysis from another site I like: wordtracker.com. For a
very small fee Wordtracker will let you enter some keywords,
suggest related keywords and phrases, let you select a
bunch, and then give you an analysis of those keyphrases for
several major engines which tell you how often they're
looked at and more importantly, the ratio of that to how
many sites are keyed to them. From this they compute an
index that gives you good keyphrases optimized for the most
bang for the buck - i.e., high popularity and low
competition will score most highly. They'll even let you do
it once for free which is enough to get you going on your ad
campaign.

I ran a bunch of possibilities, and armed with the results I
resolved to use "web design", "web designer", "web site
designer", "web design companies", and "web site design" in
my Google AdWord campaign.

Putting these in, I was shocked to discover that $250 would
last me about a day according to their predicted frequency. I
cut back to English language only and US only. (We have
international clients, but this is a game of odds.) That
helped. Then I put "free" as a negative keyword. That helped
- apparently lots of people want someone to design them a
web site for free.

In a sense it doesn't matter how fast you spend your
money. A targeted viewing is a targeted viewing whether
they're all on the same day or over a week, but if you're
going to be doing this a lot....

Anyway, I took the plunge and wrote my first ad:

"Web Design by Sidereal.
 Quality, commercial web design. Let
 us put your business on the web!"

It sounded good at the time.

I launched my ad campaign and anxiously monitored the first
twenty four hours. Something was obviously dreadfully wrong.
My top key phrase according to the WordTracker results was
indeed popular. It was chewing up my money at a horrifying
rate as thousands of people searched on "web design," but
less than one half of one percent of them were clicking on
my ad. According to Google's advice, click-through rates
under a half percent should be abandoned. Also, the
competing ads were all ranking higher than mine. Woe!

Time to pay attention to the competition. The top performing
ads were of the "Rah! Rah! We're the best! Hooray for us!"
variety that I despise, but there's no arguing with results.
Maybe I could spice it up a little while still retaining
some semblance of good taste. My next try was:

"Web Design by Sidereal.
 Superb commercial web design! Click
 us to put your business on the web!"

John Caples said that just changing a word or two could make
all the difference and obviously he was right. This ad
zoomed to the number one position and held there across all
the key-phrases I was using. The click-through rate jumped
three hundred percent in the next twenty four hours.

But something was still wrong. "Web design" was certainly
getting the viewers as Wordtracker had promised, and it was
therefor the principal drain down which my advertising
budget was flowing. I believe Wordtracker when they said it
was my best bet in terms of high use AND minimum sites keyed
to it, but it was my WORST key phrase in terms of
click-through.

By contrast "Web design companies" which had a fairly low
popularity was giving me twice as many click-throughs per
viewing. It had many fewer viewings, but also cost me a lot
less for that reason. It was certainly delivering me a lot
more visitors per dollar if not per hour.

I tried entering my key phrases myself to see what sorts of
things were showing up. That shed some light.... People
entering "web design companies" or "Web designers" or "Web
site designers" can (and undoubtedly do) expect to see the 
web sites of people building web sites for a fee, and not a 
lot else.

If you enter those phrases you are probably looking for me
or somebody like me and may click on my ad.

But what about "web design?" People entering that will see
(and undoubtedly expect to see) sites on a variety of issues
about web design. How to do it, tools for it, courses on it,
dozens of other things in addition to people who do it for a
living. People searching for all those OTHER things are what
account for the phrase's high popularity. (Did I really think
15,000 Google-users per day want to buy a web site?)

Lesson: There is popularity, and there is RELEVANT
popularity.  Here is where WordTracker's analysis, while not
wrong, needs further research and qualification. It's a
starting point but it needs interpretation in context before
you apply it to an ad campaign.

I deleted "web design" from my campaign's key phrase list.

Two good things happened. First, my burn-rate on my
advertising budget dropped dramaticly because I was no
longer paying to show my ad to thousands of people who were
looking for other things. Second, my overall click-through
rate went up. The money was now not only being spent at a
lower rate, but it was giving me higher return on
investment. (I've also changed from "web design" to "web
designer" as a keyword for search engine placement of my
site as a result.)

I've let that situation run for a week without further
modification to give it some time to generate results that
can be analyzed. Here are few findings:

First, there is an initial surge of response that then
tapers off a bit and levels out into a fairly steady click
through rate. The initial surge is likely a novelty effect. I
may try developing a couple of other high-performing ad
wordings and rotating them.

Second, despite Google's policy of charging more for
higher-placing ads, I see little difference in click through
rate based on where the ad is placing. (When you make a
change in a key word - even deleting it and then putting it
back, the ad starts at the bottom for that word and works
its way up again so you can watch what happens at different
positions. Also there's some natural variation in the top
places even for high-performing ads.) I think people just
read down the list of all the ads if they're interested at
all and click based on the wording not on the position.

As it stands I'm drawing hundreds of new visitors to my site
per week, and they're quite likely highly-targeted visitors
who are good prospects. With the ad's present performance
they're costing me about a dollar a head.

How that translates into revenue is not yet apparent. The
click-through rate multiplied by the conversion rate gives
a number that is yet too small to evaluate with any
accuracy. I've sold one and possibly two sites so far to
people arriving this way so that ad has more than paid for
itself, but that may be a statistical fluke. Time will tell.

Further, the conversion rate is more a function of how
effective my site is than how effective the ad is, so it's
only fair to evaluate the ad on the things it can do -
deliver visitors. Still, the quality of the visitors affects
conversion rate too, and I'll be spending some time trying
to disentangle those things. 

When I do the picture will be more complete. I'll let you
know how it comes out.

Best,

Ernie




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