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8/18/2011
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Can Google AdWords Express Deliver ROI?

Google's automated version of AdWords touts easy search campaigns for smaller businesses. SMBs and online marketers highlight some pros and cons of the platform.

AdWords Express is a simplified, largely automated version of Google's flagship advertising platform. It's intended to attract smaller businesses with no online ad experience--or no time to manage more complex campaigns. Sounds great, but can it boost the bottom line?

Both small businesses and marketing firms report the early results are mostly positive, with a couple of potential downsides to consider as well. Formic Media, which specializes in search marketing for small, local businesses, recently ran an AdWords Express campaign for Heathman Lodge, a resort in Vancouver, Wash. Formic senior account executive Anna Hutson said in an interview she wanted to find out if the automated platform could earn a return on the ad buy, and how the cost-per-click (CPC) compared with other types of online campaigns. (Advertisers only pay Google when someone clicks on their ad.)

"I would definitely say it's possible to get a return on investment with AdWords Express, regardless of it being a more automated approach," Hutson said. She was particularly pleased with relatively low CPC rates--less than a dollar in some cases--for sought-after keywords in the hotel industry. The campaign only generated a few online reservations, but Hutson said the ad spend paid off in terms of local visibility for the hotel--at lower costs than if they'd bid directly on them with AdWords.

"It helped increase local visibility in the market for keywords that before we were paying--and still are paying--high prices on," Hutson said.

Local awareness is indeed the goal for AdWords Express, according to Google product manager Kiley McEvoy. To that end, he said assessing campaign results might not be as data-driven as with traditional AdWords campaigns, particularly if the advertiser isn't equipped to implement the HTML code needed to track conversions.

"A lot of them are simply asking their customers as they come through the door how they found the business," McEvoy said in an interview. "Even in there are other methods out there, that's what's most satisfying to them: to know that a face that came through the door or called them specifically came because they invested in an AdWords Express ad. That's the best evidence."

Formic Media's Hutson did note that analytics aren't a strong suit: "The AdWords Express dashboard is very limited in the reporting that it actually gives you," she said. Hutson offers a workaround for AdWords veterans, however: those users can view more detailed performance data within their existing AdWords account, rather than relying on the less-robust dashboard housed in their Places account. Doing so also allows advertisers to compare Express results with other AdWords campaigns.

Google is declaring AdWords Express a success out of the gate; McEvoy said that the platform already has "tens of thousands of users" across all 50 states since its recent release from beta, when it was known as Boost. AdWords is a cash cow: Google made more than $28 billion in ad revenue in 2010, and the company is on pace to top $32 billion this year based on its first two quarterly earnings reports.

McEvoy described Express as "AdWords with training wheels" and said Google has two target customer profiles: Small businesses that have never advertised online before, and those too busy to take a more hands-on approach to search engine marketing.

There might be an unintended third category: Existing AdWords customers. Like Heathman Lodge, Carolina Rustica was already running traditional AdWords campaigns. In fact, the small furniture retailer is a big advertiser: It spends around $1,300 each day on its keywords, according to IT manager Chris Knollmeyer. After Knollmeyer set up the company's Google Places page, he became a beta customer of Boost--that account has since rolled over into AdWords Express.

"It's actually been performing fairly well," Knollmeyer said. The Concord, N.C.-based company's Express campaigns have been generating around 50,000 impressions and 500 clicks per month, at around 80 cents apiece--compared with an average CPC of around $1.20 for its regular AdWords buys. "That's very good for us, in a very competitive field."

Knollmeyer said the lower CPC for his local advertising efforts is likely to keep him an Express customer even as he continues running traditional AdWords campaigns, adding that prices for terms like "furniture" or "furniture store" can skyrocket in the hyper-competitive North Carolina market.

Another small business encountered a downside in the automated approach: Paying for clicks you might have otherwise gotten free. Luke Marchie, marketing manager at the 20-person law firm Console & Hollawell, took AdWords Express for a test spin when a Google salesperson offered him a small credit.

The legal industry can generate notoriously high keyword bids, particularly in Console & Hollawell's personal-injury sector, and Marchie had suspended the firm's AdWords spending because it wasn't generating enough business to justify the cost. Like Hutson of Formic, Marchie was interested in how CPC for Express compared with those campaigns. He said the Express platform estimated CPC in the $2 to $3 range based on his modest budget and other information.

"I was like oh, that's great. Whatever differs this from normal AdWords, it just has a lot lower CPC," Marchie said in an interview.

He soon noticed, though, that CPC was still expensive for some terms--upwards of $20 apiece for a couple of clicks. More importantly, he didn't like some of the keywords that AdWords Express employed, particularly when the firm's name was used to trigger his ad. That led him to cancel the Express campaign before the free credit turned into real dollars.

"There's no reason why we would need to pay something like 15 bucks for a click-through [on] our name when we kind of dominate the [search engine results pages] already when it comes to mentions of our business," Marchie said. "We don't have an issue driving people to our brand name."

In spite of the automated nature of AdWords Express, Google's McEvoy said the company does act on keyword feedback from Express customers in various business categories.

"There's an opportunity in the AdWords Express UI to give feedback on the keywords," McEvoy said. "We're definitely getting feedback on keywords that are good for the category as whole, or not, which is really valuable information for us."

An example: Google had developed a range of keywords for the pest-control category, but has since heard from advertisers that it's too broad: "Just because you take care of termites doesn't mean you can take care of rats," McEvoy said. Google acted accordingly and redefined categories and keywords at a more granular level. In general, McEvoy said the company is continually fine-tuning the AdWords Express platform based on advertiser data. Google made another key change based on the Boost beta: It no longer fuses all selected categories (and the keywords therein) on a single campaign.

"We quickly found that things performed much better by splitting those out into two separate campaigns, and allowing the user to write an ad for their dog-sitting service and then a second ad for their dog-washing service," McEvoy said. "They could see a much higher performance on those two ads individually."

Among other changes to AdWords Express since coming out of beta: phone support and mobile ad placement. The latter could be especially important given the geo-targeted nature of Express campaigns: McEvoy said location is about twice as likely to be a factor in mobile searches compared with Web searches.

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