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Thursday, December 10, 2009

AdWords Reform: Low-Hanging Fruit

At SES Chicago, a member of Google's product management team routinely asked me if there were particular aspects of the AdWords interface that we ("power users") would like to see improved.

Sometimes I'm at a loss when it comes to questions like that. There is so much going on in an interface like that, specific suggestions can slip my mind... and in any case, in the beta process for the new interface Google must have had to weigh thousands of pieces of input anyway (so it's really the weighing that is the issue as opposed to any lack of cool feature ideas).

To be a smartass, I certainly might have pointed to the campaign setup phase that hides the need for us to enter separate (or no) bids for the content network or to more clearly offer advertisers the ad "rotation" (as opposed to "optimize") option. Google makes more money when advertisers forget to address these settings, so I basically don't expect them to change the state of affairs that amounts to "usability in reverse" on the campaign setup. It's not unlike hard-to-read credit card statements. The less people know, the more the company makes.

Asking for a small feature change misses the point, if there are significant areas that affect campaign economics negatively, that haven't budged.

So then it hit me -- we still haven't seen any movement on the issue of differential bidding for the "search network." George Michie recently reiterated what is basically a unanimous feeling among advertisers: that we need "syndication controls."

To refresh your memory, there are essentially three big channels available to AdWords advertisers, with many controls underlying two of them. (1) Google Search; (2) The Search Network; (3) Content Targeting.

Google Search is self-explanatory. Content targeting is a network of online publishers, from the biggest to the smallest, who participate in the "AdSense" advertising program. For advertisers, there are two flavors of this program: automatic placements and managed placements. Both offer stupendous levels of control for the advertiser, including the ability to set specific bids.

The search network is other search engines who display Google AdWords ads much the same as they appear on Google Search: AOL, certain Internet Service Providers, Ask, metasearch engines, etc. But in addition to that there are "navigation like" properties. Google publishes no formal exhaustive list of these partners.

This is where it gets weird. You can opt out of the search network. But who would want to, as it is a decent chunk of good traffic that typically far outstrips the buying intent of things like display ads, etc. Unfortunately, on most accounts, it universally performs worse, with CPA's (costs per acquisition) coming in 20-30% higher. And you cannot bid on the inventory separately or opt out of specific partners or segments, something you can do extensively in the other two megachannels within AdWords. So you're either all in, or all out. That's strange, and it hurts advertisers. I join Michie in his "rational plea."

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