A quick poll:

How many marketers think sending an identical email to everyone on a mailing list will perform better than individually tailored emails based on each recipient’s past behavior?

How many think sending non-personalized direct mail pieces will outperform personalized outreaches?

Anybody? Anybody? Bueller?

If no one thinks the monolithic approach would ever beat the segmentation approach, why is it that some PPC professionals advocate ditching long tail keywords and letting broad match catch the tail?

The benefits of the long tail search advertising are exactly like the benefits of email segmentation. Consider:

The more targeted ad is served having better ad copy which raises CTR and therefore Quality Score. This leads to more traffic from the same number of user searches.

A more targeted user search necessitates a more targeted landing page. Not the somewhat generic “Fender Guitar” page, but rather the “Fender 4 String Bass” page. That more targeted page will likely deliver a higher conversion rate, hence more sales from the traffic generated by the ad.

Folks looking for “Fender 4 String Bass” will have a much higher conversion rate than those searching for “Fender guitars.” That fact means you can bid higher on the more targeted ads, putting the ads for the most targeted traffic higher on the page than the more general terms which could be yielding more impressions and higher CTR.

With more of the highly targeted traffic going to the tail keywords the less targeted, more general keywords will be bid down to more accurately reflect the value of the traffic. As I mentioned in my post on syndication partners, better resource allocation leads to a bigger program at the same rate of efficiency.

The advantages of a thoroughly developed keyword list are obvious in principle, but does this really matter in practice?

The answer is an emphatic “YES!”

In a recent empirical study, we took apart campaigns from a number of our clients ranging in size, product types, price points and more, to see the degree to which the “long tail” matters. We found that the importance of those targeted searches varied tremendously from a low of 8% of the total business to a high of an amazing 83% of the total. The median of the study group was 31%.

Obviously if the program is tiny, and the tail is only 30% of the game, it might not be worth the attention, but for large programs even 8% is worth chasing. In the case above that 8% represented over $200K in sales per month.

Nevertheless, some argue that those targeted searches would be captured by broad match anyway, so there’s no real advantage gained by building out and maintaining a comprehensive keyword list.

Not so.

As a test case, we took a client in the consumer electronics space who carries products from more than 1,000 different vendors. We then asked the question: what’s the traffic value differential between the highest traffic keyword for each vendor brand, and the rest of the keywords associated with that brand? In other words, if we just ran the highest traffic term for each brand on broad match to what degree would we be blending together traffic of vastly different quality?

The answer: “We’d be mixing apples and oranges.” In the test case and for vendor brands with enough traffic to have a tolerable signal to noise ratio the median variance in traffic quality (margin dollars per click) between the brand-specific “head” and the brand-specific “tail” was 84%! And not always in the direction expected.

Throwing all the granular data into the head keyword performance will very often result in significant over spending on one cohort of user searches and significant opportunity lost by under spending on the other cohort(s) of traffic.

So, there isn’t much question that for a substantial program the tail matters, and treating the head keywords the same as the tail keywords leads to significant mishandling of the bids.

The other rationale for ignoring the tail relates to the cost of building and maintaining long tail campaigns. “The time is better spent elsewhere.” Well, that could be true if either of the following is true: 1) it’s a small program with an insignificant tail, not worth the management cost to go after, or 2) you lack the power tools and algorithms necessary to build and manage the tail comprehensively with cost-effective human effort.

There is no solution for the first issue. If the whole program isn’t worth spending much time on, then certainly the tail isn’t worth it.

The second issue however is simply a resource and know-how constraint, which for a professional paid search manager should not be there. Telling folks “we don’t have the tools to manage your program effectively” is a hard message to deliver, but it’s the right message if it’s true. Telling clients: “The tail is unimportant,” or “The tail is effectively handled by broad match” simply isn’t honest for most sizable programs.

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

Related Topics: Channel: SEM | Paid Search Column

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About The Author: is Co-Founder and Chief Marketing Scientist of RKG, a technology and service leader in paid search, SEO, performance display, social media, and the science of online marketing. He also writes for the RKG Blog. Follow him on Twitter at @georgemichie1.

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



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  • http://www.periscopix.co.uk Ben Gott

    I couldn’t agree more George, Who are these pundits and where do they live!?

    I’ve never been able to get my head around why Google advocate (and they do) the few broad match term approach. I refuse to be a sceptic on this……

  • http://www.rimmkaufman.com George Michie

    Thanks Ben,

    You hear some pretty wild stuff at conferences these days. How some of these folks get speaking gigs is beyond me!

  • PayMePerClick

    I’ve noticed that many, if not most, of my long tail keywords are inactive due to relatively low search volume. I think this is absurd especially since Google won’t release the number of searches that would get you out of this “Red Zone”. These were the keywords that were THE most profitable because they were very descriptive and thus cheap since no one else was really competing. Now Google is basically paying you to bid on phrase or broad matched keywords with very high competition so they can get more money out of advertisers.

  • http://www.rimmkaufman.com George Michie

    Excellent observation! We’ve seen the same trend. Google seems to be interested in pruning the tail for you. To a degree, and I’ve heard this off the record from Googlers, there are probably some computational constraints on what they can handle. When you think about the complexity of an auction just within a single account: “how many ads would phrase match or broad match to a given user search?” and then multiply that by all the advertisers in that space it is a beast — more so than the organic listings because of the dynamic nature of the bids and QS. Simplifying the problem by ignoring low volume KW is somewhat understandable.

    As described in posts referenced above, I don’t think that makes Google more money, I think it makes them less money. The blended performance leads to a smaller program if the efficiency targets remain the same.

  • http://www.efrontier.com sidshah

    Nice article George. I am in full agreement with you. There appear to be two trends in the marketplace. On the one hand user queries are getting longer but on the other Google’s matches are broadening faster an many waistlines. Even then, I have analyzed search campaigns and have found that the tail contributes between 10% to 50% of the total marketing volume.

    From an analytics standpoint, I can see where the “dont bother with the tail” and “tail terms are inefficient” come from. People simply look at short term data and find many inefficient tail terms. The truth is head and tail terms have to be looked at different windows when measuring performance. My research has shown that about 55% of tail terms in a well run campaign that get clicks in one month but not in the consequtive one. In other words, tail terms need a longer window when you evaluate their performance.

    Also in full agreement with you tail terms need automation and algorithms comment. The volume and sparsity of data on tail terms is an interesting mathematical problems and needs sophistcated modeling techniques to accurately bid them. If one cant do the modeling and bid optimization it is not the tail’s problem, its yours !

  • http://www.alanmitchell.com.au alanmitchell

    Hi George,

    Great article. Like your point about “mixing apples and oranges”, and the inefficiency of appearing for long-tail searches through the head. If long-tails and the head perform very differently, grouping them together and using the same bids for both will no doubt result in over-spending on the head and under-spending on the tail.

    I recently carried out similar research on searches of varying word lengths (1-18 words) and came to similar conclusions to yourself regarding long-tail profitability.

    Searches of 5 words or more (what I described as long-tails) accounted for 21% of clicks, but delivered a disproportionally high 40.5% of conversions ( http://www.alanmitchell.com.au/techniques/benefits-of-long-tail-keywords/ ). This makes complete sense – people making long-tail searches have arguably carried out the large majority of their pre-purchase research and are often further along in the buying cycle and more likely to buy.

    I also found that CTR and conversion rate were considerably higher for searches of 5 words or more, and cost per click prices were considerably less / average positions considerably higher for long-tail searches.

    Guess my conclusion is the same as yours: there is massive value in the tail. Any effort by Google to play down their value and encourage advertisers towards more expensive head keywords through “low search volume” scaremongering is in my opinion a short-sighted measure to increase Google revenue (“low search volume” keywords are hardly “low search volume” from what I’ve found http://www.alanmitchell.com.au/techniques/how-low-is-low-search-volume/ ).

    What’s more, as search engines evolve, users will come to expect more personalised and relevant results, making long-tail relevancy all the more important. Long-tail keywords are, and will continue to be, an essen-tail (apologies – couldn’t resist) component of PPC marketing for a long time to come.

    Thanks for an insightful post as always.

    Cheers,
    Alan

 

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