Should You Be Bidding On Your Brand Terms For Your Search Ads?

While many advertisers have bought into the idea of bidding on search terms that include their brand name, there are still plenty of smart people that question the incrementality of such a practice. We’ve questioned it ourselves, most recently in a 2012 study.

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That study looked at incremental clicks in instances where you’re already appearing in the organic rankings — something that probably happens a good deal when you bid on the terms associated with your site and your brand.

Whether you’re already on the side of bidding on your brand terms or not, odds are that you’ll have a discussion with someone about bidding on search terms for your brand at some point in the future.

To judge the efficacy of search ads on brand terms requires that we look at incrementality. Does bidding on those terms get you anything that you wouldn’t get with organic search alone?

Let’s walk through a couple of exercises that will help you assess the incremental value of brand terms and decide whether or not to bid on them.

Comparing The Cost Of Brand Search To The Benefits

There are two different paths you can take: bidding on your brand terms, and not bidding on your brand terms. Decide what to do by estimating which scenario makes you more money.

You should already know your baseline, since you either are or aren’t bidding on your brand terms. To know more about your paid search alternate reality, you’ll need to gather a few data points:

How Much Traffic Would You Lose To Other Sites By Not Running Brand Campaigns?

The numbers from our 2012 study estimate that if you rank first organically, 50% of your ad clicks are incremental — which means that, in an average scenario, 50% of your existing brand ad clicks would go elsewhere if you were to turn off your brand campaigns.

Imagine half of your brand ad clicks and conversions going to someone else. (This step is usually enough for me to decide to continue with brand search, but you may require more convincing.) You can also take a look at the paid & organic report to see how paid and organic search are working together in your account and potentially see the CTR/click benefits in action.

What Is The Value Of Organic Site Traffic Relative To Paid?

Determine the value of organic site traffic relative to paid, especially in terms of conversion rates and revenue numbers. Google Analytics will let you see a detailed view of performance across channels. There’s even a new feature in Analytics that allows you to segment your brand and generic keywords for reporting.

A paid user vs. an organic user could very well behave differently on your site. An ad click is a signal that a user is providing to you about who they are and what they do online. Use that signal.

What Is The Profit Of A Sale/Conversion?

Start by looking at search funnels and multi-channel funnels to see what value brand ad clicks are bringing to your customer’s overall journey. Beyond that, you should know about your profits after doing your own analysis.

If you track lead value, you can view some of those stats in AdWords or Google Analytics, but you should probably be taking a longer, lifetime value-based approach to measuring customer value. A new, satisfied customer can generate additional sales in the future, and a user who sees your search ad may decide to navigate directly to you in the future.

After answering all three of these questions you should be able to estimate your costs with brand searches, and how that compares to your expected profit.

Here’s what that formula will look like when brand search is beneficial to your account (get your % incremental from the chart a few paragraphs down):

Cost of paid brand search

Go with what gives you the best chance to maximize profit. If the numbers come out in favor of bidding on brand terms, you can move on to deciding the right way to bid on them and to measure their performance.

Calculate Cost Per Incremental Click

Tactically, you can introduce a new metric into your bidding and account analyses that factor in the appearance of your site in the organic rankings for brand terms.

Our 2012 study showed how ads interacted with different organic rankings.  The results were pretty compelling.

Incrementality of organic and paid clicks

The results of Google’s 2012 study

You can start factoring the expected incrementality of your clicks into how much you’re willing to pay. Recognize what percentage of clicks that include your brand name are incremental based off of your organic ranking, and multiply that into your calculations for their CPA or other performance metrics.

Calculation for cost per incremental click

You should have a good sense of where you’re appearing organically on your brand terms. In many cases you’ll rank first, but depending on a variety of factors you could find yourself behind other sites.

An organic ranking of 2-4 usually makes ads a lot more incremental than when you’re ranking in position one (82% vs. 50%), which makes those clicks much more valuable to you.

Update how much you’re willing to pay for your ads in relation to where you rank on brand terms organically. If something is to change on your brand terms’ rankings, be sure to update your calculations.

Know Where Those Lost Incremental Clicks Might End Up

On top of those incremental clicks that you should be getting, bidding on brand terms also means that your competition should receive fewer clicks. If you stop bidding on brand terms, your competition has a lot more potential to move their ad higher on the page while potentially paying less to do so.

Take a look at your Auction insights report to see the types of domains that are bidding on terms associated with your brand. Even if they aren’t targeting your domain specifically, based on their keywords they may be appearing in the same auction as you.

Since you can run this report at the ad group or campaign level, specify those keywords that are most important to your brand and see which of your competitors might start taking traffic from you if you choose to stop advertising on those terms.

Auction insights

Managing Brand Campaigns

In addition to the numbers above, bidding on your brand terms gives you a great place to put your best foot forward with searchers. It can provide value to you beyond incremental clicks.

You control the messaging and highlight the pages that you most want them to visit (sitelinks in particular are a great way to influence users and help guide their navigation). You can highlight seller ratings or good reviews you’ve gotten. It’s also a great place to split test your messaging for other channels.

Well thought out management of your paid brand campaigns can give you incremental conversions by directing consumers to the landing page of your choice rather than Google’s algorithmic choice.

Remember that incremental value from brand search can come in places aside from new clicks. Paid search can be a valuable testing ground for your entire brand.  (It’s also a great way to control returning visitors with RLSA.)

Conclusion

You know your account best. When you encounter questions on brand search from clients, bosses or even yourself, run these exercises to frame those conversations. Decide if brand search is the right thing for you, and adjust your strategy accordingly.

Opinions expressed in the article are those of the guest author and not necessarily Search Engine Land.

Related Topics: Channel: SEM | Google: AdWords | Paid Search Column

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About The Author: is the Director of Performance Ads Marketing for Google, responsible for a broad portfolio of ads products including search, shopping, display, and analytics.

Connect with the author via: Email | Twitter | Google+ | LinkedIn



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