NB: This is a guest article by Simon Cooper, account director at Kenshoo.
The importance of relevancy cannot be overstated in today’s search marketing industry. At the back of every advertiser’s mind, there’s always the need to ensure the copy they produce will be relevant to the people they want to reach.
This attitude is epitomised by the value placed by advertisers on Google’s Quality Scores – which go up according to how relevant ad text, as well as the content of the landing page, is to certain key words.
One of the key metrics used to measure this is click-through rate (CTR); one can broadly assume that the more people are clicking on an ad, the higher its Quality Score will be.
The benefit of a high Quality Score is that Google rewards you with a lower actual cost-per-click (CPC) as, according to their metrics, you are offering a more relevant service to the user and therefore a better user experience overall.
With the benefit of being able to pay a lower CPC, Quality Score has become an important metric when measuring the effectiveness of a paid search campaign.
However, I would like to argue that too much value is placed on these Quality Scores.
Whilst it is clear that they are important, the industry is at risk of getting hung up on this metric at the expense of focusing on what should be the real objective: driving conversions.
The travel industry is particularly affected by this conflict.
Travel woes
Advertisers in the travel industry aim above all to fill their capacity; whether that’s seats on planes, rooms in hotels, or anything else. As a consequence, something the sector is often concerned about is distressed inventory.
These are seats or accommodations that, if not sold, will be a cost burden to the owner. Offloading distressed inventory often leads to heavy discounting to ensure that at least costs are covered.
In this situation, there is an immediate need to drive bookings.
I’ll be bold and say that being able to write an ad text that will produce a high CTR is not too difficult. Make sure the keyword appears in the title, include a strong call to action, have a relevant display URL, and off you go.
But – and this is the key point – it shouldn’t be just about getting people to click on the ad; what’s more important is that the people who click on the ad will actually be led to make a booking.
Driving clicks and visitors to the site is one thing, but this traffic has to convert. It’s no good just having a good QS, but lots of empty hotel rooms, or spare seats on the plane.
A high volume of click throughs with a low number of sales will ultimately lead to a higher advertising cost per eventual sale.
What it comes down to is the choice between running a broad advert that will lead many people to click through but with only a small percentage of those going on to make a booking, or running a more specific ad that will see less click throughs but a higher percentage of those individuals actually converting into a sale.
For example, a hotel aggregator that is running quite generic ads for "hotels in New York" is likely to see very high CTR.
After all, it’s a popular destination. But if all of the hotels it offers are quite niche – for example, all at either the very top or very bottom of the market – they may find that very few of the people visiting the site are actually making bookings.
Reality
The CTR, and as a consequence the Quality Score, may be very high, but the ads aren’t having the desired effect.
By using tracking technology that allows full analysis and optimisation, providing the ability to track not just bookings but also other factors such as the number of rooms, nights, departure dates and extras, the same hotel aggregator would be able to change this approach.
By writing ad copy that more accurately reflects the hotels on offer, they will reduce the number of people visiting the site but, ultimately, they are far more likely to actually make bookings.
Once advertisers look beyond CTR and Quality Score, they can get back to matching customers with the actual products. This can lead to far better results that improve overall profitability which, at the end of the day, is surely the most important target.
NB: This is a guest article by Simon Cooper, account director at Kenshoo.
NB2: Cocktail image via Shutterstock.