Effective AdWords campaigns – algorithmic campaign optimization is key
The pace of growth of online advertising, especially Google AdWords , is constantly increasing. Seeing the benefits and potential of this form of promotion, more and more companies are allocating larger budgets to attract new customers. This typically translates to an increase in ad impressions and clicks. Consequently, with more data at hand, it becomes more difficult to interpret it correctly. It's easy to compare which ad groups and keywords are performing best, but do we know (and are we sure about it) what factors influence this? If you want to create effective AdWords campaigns, you need to know!
Of course, by analyzing campaign results ourselves, we notice certain behaviors – what day or time of day has the highest traffic on the website, whether users in Warsaw are more likely to buy our products than internet users in Katowice, and whether it is worth investing an equal budget on advertising targeted at mobile devices compared to ads intended to be displayed on computers.
But let's consider whether we can accurately analyze whether a customer from Warsaw who came across our ad on a Tuesday afternoon using a tablet would be more likely to use our services than a user from Łódź who searches for services similar to ours on a computer on a Saturday evening?
Modern consumers have become more impatient, demanding and curious – they value their time and expect to find what they are looking for here and now.
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Micromoments and effective AdWords campaigns
Modern marketers must meet consumer expectations and strive to be relevant to intentions – after all, you cannot focus only on conversions, they must be supported in various ways.
As Google describes micro-moments: these are those short moments in which a person expects the device they are using to fully respond to their needs – to learn something, go somewhere, do something or buy something – and thus to precisely satisfy their intentions.
We divide such micro-moments into 4 models:
- I want to know – when someone is doing market research, searching and comparing, but is not necessarily at the purchasing stage.
- I want to go – when someone is looking for a local business or considering buying a product at a nearby store.
- I want to do – when someone needs help with a task or wants to try something new.
- I want to buy – when someone is ready to make a purchase and may need help deciding what to buy or how to go about it.
What can we consider micro-moments?
- the heatwave at the end of May certainly influenced the increase in bookings for accommodation at the seaside and the sale of sun care products,
- the first snowfall always causes a sudden increase in orders for winter tires and their replacement at service centers,
- The Polish national team's promotion to the FIFA World Cup in Russia has led to an increase in sales of national team shirts and searches for accommodation prices in the cities where Poland will play its matches.
The examples mentioned are easily noticeable trends, and many of the smaller ones we cannot even register ourselves.
It's all a matter of scale – if we offer a few products and our campaigns only have a few ad groups and a dozen or so keywords, we can control everything. But what if our offerings are very extensive and we run multiple campaigns with hundreds of ad groups? How long will it take us to interpret the results and draw conclusions? Will we be drawing these conclusions daily? What about micro-moments?
That's where algorithmic optimization comes in, ensuring effective AdWords campaigns are optimally configured and flexible to changing conditions. Now that we know that managing bids for each keyword on our own can be overwhelming, we turn to automation. This is where algorithms come in.
Algorithms and effective AdWords campaigns
An algorithm is a set of steps needed to complete a task. Its purpose is to move a system from a certain initial state to a desired final state. All programming is based on appropriate algorithms. Computers possess virtually unlimited computing power; we simply need to assign appropriate patterns. The study of these patterns is the subject of a rapidly developing field of knowledge – algorithmics.
An example? Here you go. How does NASA determine the positioning of space panels on the International Space Station (ISS) and decide on changes? Using optimization and scheduling algorithms.
More advanced algorithms are self-learning algorithms, also known as machine learning. Their operating scheme allows a computer application to predict an outcome or make a decision based on independent analysis—without the need for programming.
Machine learning
"It is an interdisciplinary science with particular emphasis on fields such as computer science, robotics, and statistics. The main goal is the practical application of advances in artificial intelligence to create an automated system that can improve itself using accumulated experience (i.e., data) and acquire new knowledge from it."
Machine learning is a collection of techniques that can help us create "intelligent" systems. In practice, it's a set of ready-made algorithms supported by mathematical proofs. Most were developed in the 70s, but only now (due to increasing computing power) are they finding practical application. To put it simply, we first need to train such algorithms with sufficient data, and then they can be used to predict behavior. Our algorithmic campaign optimization and reporting system, Verseo Campaign Manager, is based on these techniques.
VCM
VCM is part of a large project created by Verseo, aimed at providing clients with unique and effective solutions that help them strengthen their position on the market.
The algorithms used in it are used to:
- Detecting known and unknown patterns in data.
- Formulating decision rules.
- Acquiring new behaviors and structures through generalization and analogy.
Ok, that's the theory, time to get down to specifics!
VCM uses self-learning algorithms to achieve the desired results.
Depending on whether our goal is:
- optimizing the assumed budget in terms of conversions or clicks,
- maintaining a specific advertising position at the lowest possible cost,
- achieving the assumed revenue-to-cost ratio (ROI, ROAS),
- minimizing customer acquisition costs (CPA),
- maximizing revenues,
- maximizing conversions,
- maximizing ad clicks.
Verseo selects the right optimization strategy for each goal. Operating under the principle that if something is good for everything, it's good for nothing, a different algorithm is responsible for each strategy. Furthermore, even different algorithms will be used when we want to minimize the cost of customer acquisition, depending on the type of campaign – search campaigns , shopping campaigns , or display campaigns.
By analyzing numerous signals 365 days a year, 24 hours a day, the system makes hundreds of setting changes each working day based on data history. It identifies behavioral trends, including seasonality of offers. It discards products that don't translate into increased profits in favor of those most likely to sell. It can individually adjust bids for each ad group based on device type, time of day, or audience list.
The system constantly thinks and draws conclusions aimed at achieving its goals. However, we must bear in mind that the system cannot cope with constant changes to the website, large budget fluctuations, or constant campaign shutdowns and re-enablements. The system prefers stability and gradual changes.
I tend to compare running a campaign to flying an airplane.
The pilot must take off, take off and stabilize the flight, and only then can he use the autopilot, which selects the appropriate flight altitude and maintains the correct direction.
- our fuel is data,
- our pilot is an AdWords specialist,
- our autopilot is VCM.
The key to success is to properly understand your campaigns and choose the right strategy for one or more campaigns.
To sum up, we need to ask ourselves whether AdWords campaign automation is still a trend or is it already a necessity?
In manufacturing, although initially met with skepticism, automation of production processes is considered an essential element of business development and has been gradually implemented for years. In agriculture, automation has led to the rapid development of agricultural practices. Daily office duties have also been streamlined due to automation.
In my opinion, it's also inevitable in the case of AdWords , although few Polish marketers are aware of it yet. The sooner we understand this, the easier it will be to achieve the best results in our campaigns.
You can find more about our platform on the website at this link!
Summary
The above article covers the following topics:
- the growing complexity of advertising campaigns and the need to use algorithms to optimize them effectively,
- how micro-moments influence consumer behavior,
- the importance of algorithms and machine learning in decision-making and the effectiveness of advertising activities,
- operation of the VCM (Verseo Campaign Manager) system in the optimization of Google Ads campaigns.
