• http://www.datapop.com Frank Lee

    Nice post, Sid. I agree with points here. On “wasted spend,” I would also add that i typically look to spend 10-15% of my spend in any given month to “testing” budgets. Meaning, if i have 10-15% of my budget being spent to keywords with 0 conversions, i am okay with that (as long as my overall CPA/ROAS goals are being met) because i am trying new things.
    I agree that many folks bid down or pause keywords too soon, w/o enough data to support their decision. I’ll also throw out there that if you test for the proper message against these keywords, often times these keywords justify themselves on position 1 on Google. Once you find the optimal combination of keyword, ad and landing page, then determine the best bid price.
    Lastly, i love the idea of bucketing keyword data. in fact, that is how you can understand creative performance as well… by bucketing like intents and understanding the messages that lead to the best response points.

  • Matt Van Wagner

    Hi Sid,

    Nice article, and nice recommendation for another way to approach to difficulty of managing through the fog of long tail keywords. I agree that ‘wasted’ is the wrong way to categorize the cost of the long tail. I think of it more as a necessary overhead to be managed appropriately.

    Applying an average yield approach to determining keyword decision thresholds (bid down, bid up, pause, delete) seems like a more reasonable approach than simply applying an arbitrary pulled out-of-thin-air threshold based on time or clicks. The challenge in applying this approach, I suppose, is to balance the gain you will get by bucketing your l-t keywords by characteristic (meaning, clicks, aggregated CTR or CVR, CPA) against the cost of complexities required to manage the effort. Managing long-tail keywords by their ever-changing performance characteristics,almost by defintion would have to be done by machine, since any changes made to manage the long tail bids directly and immediately influences performance characteristics of your other keywords that compete in the auction.

    I get dizzy just thinking about it. Very glad there are companies like yours who have algorithmic systems designed to operate inside the fog of long tail.