Advertising Archives • Lake One ®

The Future of Third-Party Cookies: 5 Insights

Posted on July 1, 2021July 7, 2021 by Andrew Schulz

By now, you have probably heard about Google moving to phase out third-party cookies. A third-party cookie is a little piece of code placed on a website to collect data. Marketers use this data to learn about user behavior and provide a better, personalized web experience. You make have also heard Google’s recent announcement they are delaying their cookie depreciation until late 2023 – almost two years later than their original deadline! So what does all this mean and how did we get here? Let’s take a look.

Not only is it outdated, but it is flawed. Third-party data is often collected through an aggregator where the source of the data is unknown. Therefore, advertisers know little about how the data was collected making it challenging to evaluate the data quality and serve ads to the correct audience when it matters most. While many demand side platforms have seemingly endless targeting opportunities, the accuracy of these targets can be questionable.

The cookie was originally invented to remember website visitors but was limited to single site behavior. With the rise of ad tech businesses, the cookie evolved to track people across websites and the framework for ad targeting was born. It was an ill-fated change, though, with inherent user privacy issues.

Fast forward to today, privacy concerns are front and center as big tech muscles for more market share while trying to appease regulators. In 2016, the EU passed GDPR leading to the web cookie consent banner we have all become so accustomed to. In following years, Apple and Firefox started blocking third party cookies by default

General Data Protection Regulation (GDPR) Image: iStock

3. Third-party data will remain

The end third-party cookies does not mean the end of third-party data. Although this cookie phase out will continue to change how we collect data, alternative tracking and targeting methods will continue to grow. Instead of tracking at the individual level, advertisers will likely have to rely on using aggregated, grouped data to get in front of their audiences. Behaviors within a group can still roadmap effective marketing strategies. These changes will force us to rethink how we reach our audiences at those crucial moments. And that is a good thing.

Advertisers will need to adapt by using alternative targeting methods. Some methods are not new but will gain importance once again. Other solutions will become more prevalent. Take contextual targeting, for example. Often snubbed in favor of other behavioral targeting tactics, this method does not rely on cookies. Instead, ads are served based on the content of a web page. And with the advances in machine learning, contextual targeting no longer relies on just keywords.

While contextual targeting is not new, Google is proposing a new alternative to third-party cookies known as a Privacy Sandbox. It would allow ad targeting to continue on Chrome through the use of APIs. Advertisers would receive aggregated data about ad performance without identifiers. Google believes this addresses privacy concerns while still providing an optimal ad experience for advertisers. The skeptics, though, believe this could be another move by Google to control more market share.

Finally, we could not discuss alternatives without mentioning first-party data. This is data that a business owns and collects through actions on a website or subscription-based email campaigns, as examples. The data quality is typically much better and from high value audiences made up of leads and customers. It can, and should be used to create highly targeted, personalized campaigns.

Image Source: dialogtech.com/blog/first-second-third-party-data

5. Google will still collect your data

Just like your business, any information you give Google is their first-party data. And with the development of new alternatives, such as their Sandbox concept, ad targeting on Google will continue is some form. While ad tech firms may be scrambling a bit, Google’s grip on the ad industry will not change. It may even expand. And that is ringing the alarm – both in the ad industry and from regulators – which is likely why the tech giant delayed the third-party cookie phase out until late 2023.

For more information on Googles announcement and how it may impact you business, please contact us. We are here to help.

How to Choose the Right Google Ads Bid Strategy

Posted on May 27, 2021May 27, 2021 by Andrew Schulz

The world of search is rapidly changing. As the largest stakeholder, Google is leading this movement by changing the behavior of search tactics. There is a power shift as they push for more and more automation. As these changes happen, it is more important than ever to understand what tools are available and how their behavior can impact reaching your business goals. In the following example, we tested Google Ads maximize clicks automated bid strategy and evaluated the outcome. But first, let’s review some of the changes and how you can take control back through the use of campaign experiments.

Setting the stage: The changing world of paid search

Earlier this year, Google eliminated broad modified match type. This is small but impactful step toward a keyword less world. More settings in your Google Ads accounts default to automation. And those Google Account Strategists? Always pushing ‘Smart’ campaign options. As big brands continue to pour millions of ad spend dollars into campaigns daily, automations power grasp will continue.

Image Source: https://support.google.com/google-ads/answer/10286719

But what about those of us who need to hit performance targets and understand how we get there? If giving in to the world of automation makes you uneasy, you are not alone. Simply configuring a few campaign settings, loading some ad creative, and letting Google do the rest is simply not good enough for small to medium sizes businesses. But how do you know? Google gives the ability to test automation using experiments.

Take control: Google Ads campaign experiments

If you are unfamiliar with campaign experiments, they are a copy of a campaign where campaign managers can test changes without impacting the original, or control campaign. Budgets and traffic can be split evenly creative a true split test environment.

Image Source: https://whatisthewhat.com/ab-testing-on-landing-pages/

Curious how a new landing page might perform? Set up an experiment. What about bid modifiers? Or maybe a unique ad copy idea that is too good to pass up but you are unsure how it will perform? Set up experiments. Advertisers can test any number of campaign tactics while avoiding the headaches of skewed data and sequential testing. More importantly, it gives the advertiser control over what works best for their account and business versus handing the keys over to Google.

Testing Google Ads automated bid strategies

In the following example, we had a lead generation client new to paid search. With a limited monthly budget in a very niche B2B industry, understanding how their money was spent was crucial. In our quest to prove more campaign power is better, it was a perfect time to test automated bid strategies with the help of experiments

The Set Up

Our campaigns were segmented into two groups: segmented and aggregated campaigns. Within these groups, we targeted category, subcategory, and individual product offerings. Aggregated campaigns gave Google as much control as possible while segmented campaigns retained as much control as possible. Since the client was brand new to paid search, we decided to test maximize clicks. The tests ran for 60 days.

Aggregated Campaigns

Bidding: Maximize clicks
Ads: Responsive
Match types: Aggregated

Segmented Campaigns

Bidding: Enhanced
Ads: Expanded
Match types: Segmented

The Results

In our Category test, Google determined only impressions were statistically significant. While overall volume was low, we had seen enough. Predictably, the aggregated campaign CPC was much higher. Google will work hard to generate clicks but will spare no expense doing so.

In our Sub Category test, Google determined all data points were statistically significant. These results surprised us. Excluding the one conversion, the aggregated campaign outperformed segmented. It generated higher engagement at a lower cost. This seems to be the perfect recipe: low cost, traffic driving keywords. This was a win. Google validated the value of these keywords by keeping costs low.

In our last test, Google determined all data points were statistically significant for our individual campaigns. Search volume was the highest and results were mixed. Although our segmented campaign generated a higher amount of clicks, engagement was not much different. Our aggregated campaign CPC was higher in this test.

Takeaways: When to Use Maximize Clicks

You often hear use maximize clicks to drive traffic as this is a common use case. It our tests, however, our enhanced bids generated 43% more clicks. Budget played a role here. Google was limited in the clicks it could generate due to a small budget. As we expected, maximize clicks spent more to achieve the desired outcome as was the result in 2 out of 3 tests.

In our sub-category test, maximize clicks outperformed, including achieving a lower cost. Why? The keywords and the variants we used kept costs low while still driving traffic. Maximize clicks validated this by generating a lower CPC then our enhanced bids.

With a new account and no conversion data, maximize clicks is a great way to drive traffic and gather initial learnings. Be mindful of Google increasing costs to achieve the outcome as maximize clicks will spend daily budgets. Understand how your budget plays a role.

Our test is a good example of how keywords have an influence on automation behavior. Think about the competition and intent of your keywords. Popular, head terms can drive up costs quickly. However, niche keywords can still drive traffic but at a lower cost. You can use maximize clicks to validate keyword performance.

Final Thoughts

As Google continues its push to more automation, it is important to understand the impact of these strategies. We are not against using automated bid strategies. Quite the opposite. We advocate always testing first, to understand the impact these strategies have on your accounts and campaigns. Use these strategies to your advantage. Looking past their goal, automated bid strategies can validate other tactics you use in your account.

For more information on Google Ads, please contact us. We are here to help.

2021 Paid Search Trends to Keep On Your Radar

Posted on January 18, 2021January 19, 2021 by Andrew Schulz

2020 was an unpredictable year. It pushed us to think differently how we communicate and interact with one another. Typical marketing trends were thrown out the window! Creative thinking was more important than ever, and adapting quickly was often the key to success. The same can be said for paid search trends.

Campaign managers saw it all – data points changed dramatically, seasonal shifts came at new times, and certain benchmarks no longer applied, to name just a few. What does this mean for paid search trends in 2021? We see a continuing shift away from the keyword and more automation.

Death of the Keyword

You have heard it before. It is discussed every year, and now we are joining the conversation. So, are keywords dead? The answer is still the same: not yet. Keywords are not going away anytime soon. However, as Google focuses more on automation and privacy, the effectiveness of keywords will change more than ever this year

Image Source: Google

Google Shopping Takeover

2020 changed the way we think about digital strategies, and this was never more true than for e-commerce. Logistical challenges and low consumer confidence impacted conversion rates across many campaigns. Still, retailers continue to invest in and prioritize high performing ad formats such as Google Shopping. In recent years, Google Shopping ad spend generated close to 80% of retail search ad spend. Even with uncertainty around consumer spending, this keyword-less strategy will continue to be prioritized in the retail space. Spending on traditional, keyword-focused text ads will continue to decline.

Good-Bye Search Terms

In another push to change the use of keywords, Google started limiting the search query data in the Search Terms report. Campaign managers have less visibility into new keyword opportunities and irrelevant cost-driving queries. In fact, Google is removing search terms for close to 30% of account budgets. As Google continues to take control away from campaign managers, there could be cost implications that will deter the use of traditional keyword strategies.

Not So Exact Match

Expansion of close variant matches can be expected to continue. One of our larger volume accounts generated 1,324 unique close variant matches last year. We have also witnessed Google completely change the intent. The exact match keyword ‘rent my garage’ was triggered by a query for ‘garage for rent.’ The user intent is completely changed. What does this mean? Negative keyword management is now more important than ever. But with limited search term data, negative keyword sweeps are now more complicated than before.

Image Source: Practical Ecommerce

Why, Google, Why?

In this New Year, we can expect the effectiveness of the keyword to change more than ever, as Google continues to change campaign managers’ control over their accounts. We can expect less data, which is hard to write since that is the foundation of any paid search campaign. But why?

First is privacy. A lot of the changes we discussed are moves to protect user privacy. As third party cookie restrictions increase, it will be more important than ever to evolve how we use data strategies.

Next is automation. The eroding value of the keyword is a result of Google’s push for automation and Smart technology. We can expect even more automation in 2021. We wouldn’t be surprised if Google moves to Smart Shopping only this year, and there is not much we can do about it.

Planning ahead and increasing the use of automation could result in stability and cost savings. Last year was unpredictable and as digital marketers we are expected to continuously evolve. Understanding the changing landscape of paid search ensures we are set up for success.

5 Tips on How to Create a Profitable Google Ads Campaign

Posted on November 12, 2020November 15, 2020 by Pouria Nastaean

Google Ads is a great tool to have in your marketing toolbox if you’re looking for profitability in your business. The tools, techniques, and strategies available allow businesses to grow exponentially in a very short period of time. There’s a reason why companies worldwide collectively spend billions of dollars on Google Ads– if done right, it’s profitable. Here are five tips on how to create a profitable Google Ads campaign.

Understand ROI and ROAS

Having a profitable Google Ads campaign requires you to think mathematically. In a nutshell, it all comes down to how much traffic you generate, how much of that traffic converts, and how much it costs you to make that happen. The name of the game in Google Ads is ROI (Return on Investment) and ROAS (Return on Ad Spend).

ROI = Revenue-Cost / Cost of Ads

*You must know your profit margins to calculate your true ROI. This means keeping in mind things like associated costs with onboarding new leads or making a sale.

ROAS = Total Revenue / Cost of Ads

It’s important to recognize which model you should use for your campaigns and how they can affect your perception of their performance. If you have associated costs with your marketing, you may want to consider the ROI model.

Calculate Your Break-Even Point

The understanding of ROI and ROAS is crucial in effectively tracking your profitability in Google Ads and can be the difference between good vs. great. Calculating your break-even point gives you an excellent benchmark and goal to aim towards for your Google Ads campaigns. So how do you know what your ROI should be to break even? The answer is fairly simple. Divide your profit margin by one. So for the above example, our break-even point would be calculated by the following formula:

Break-Even Point: 1/.4 = 2.5 or 250%

What this means is that in order to be break-even, you need to make $2.50 on every dollar spent on advertising. Why? It’s because, for every $2.50 in revenue, you’re only generating a dollar (40%). Thus, you net zero dollars.

Verify Search Volume and Gain Keyword Insight

Before you start advertising on Google, it’s essential to research the space you are entering. Take a look at key metrics like how much the historic average CPC has been for your target keywords and much search volume there is. One way to do this is by using Google’s keyword planner. This tool even gives you some more insight into how much you can spend to expect specific results. It also allows you to see how your max CPC bid and conversion rate will affect the performance of your campaigns. Doing this research also will enable you to understand whether your budget is optimal for a profitable campaign or not. Sometimes as little as an extra $5 a day can be the difference between a profitable campaign and one that is not.

One thing to note though, Google’s predictions are not always accurate and will not ensure any such performance for your campaigns. It’s merely Google’s best insight based on the data that they have on hand. Use these insights as a general guide and helping hand during your planning. Don’t let it influence too much of your expectations and judgment. It’s best to start slow and a bit cautious while carefully monitoring your data as it comes in instead of relying on the keyword plan’s overview.

Another resource for Google ads insight is Wordstream’s Google ads benchmarks, which are updated annually. These reports provide information on many industry’s average cost per click, conversion rate, and cost per action.

Utilize Conversion Rate Optimization

Increasing your conversion rate is another key component in how to create a profitable Google Ads campaign. This can include a variety of different things, including your ad copy, having the right CTA’S, and optimizing your landing pages. This aspect of Google Ads is where you should spend considerable time on and continue to improve. It’s also where you can get very creative and utilize A/B testing and data to increase your conversion rates further.

Maximize Extensions To Gain SERP Real Estate and Increase Relevancy

You can also increase your conversion rate in Google Ads by simply aiming to be helpful to the user. This means that you should give them everything they need to solve their issue and provide as much value as possible.

A way to be more helpful is to maximize your extensions. The SERP (Search Engine Results Page) has four limited spots for text ads at the top of the page. Once you get there, use that space wisely and take advantage of it. You also want your ad to take up as much space on that page as possible.

Utilize ad extensions of all types. Here’s a brief overview of what they are and what they’re best used for:

Read more about Google Ads extensions here.

Many businesses struggle with focusing on what they know works for them. Don’t make things too complicated. If you know something has worked well for your business in the past, continue to promote and refine it. If you know that targeting a certain persona leads to a larger order value, then put more advertising dollars towards that persona. Think about what conversion actions are most important and will have the most impact. Working within your budget means that you need to make the most out of it. So treat every last dollar with care, purpose, and a vision.

Interested in learning more about how to create a profitable Google Ads campaign? Talk with one of our experts today.