For many businesses, search ads, namely Google AdWords, seem like a panacea for acquiring customers. After all, your potential customers are searching and search advertising seems like the ideal way to connect with them when they're searching for the product or service you're offering.

But as powerful a marketing tool as search ads have been for millions of businesses, search ads don't work for everybody.

One company that learned that was 4m user-strong document synchronization company Dropbox. Drew Houston, who founded Dropbox, says that buying AdWords early on was one of those things that seemed like a no-brainer. But the results for his young startup were "horrific". VentureBeat explains:

...the company tried to continue that growth through traditional methods, it found that it was paying something like $400 to acquire each new user, which was far more than customers paid for the service.

What went wrong? Houston said the problem, particularly with search advertising, was that no one was actually searching for a document syncing product. That’s the danger with trying to solve a problem that may be real, but that people don’t realize they have yet.

So Dropbox turned to the tech media and social media, and the rest is history.

Certainly Dropbox's experience with AdWords isn't unique. Many businesses try AdWords only to pull the plug when it fails to deliver the results desired. The truth is that there are products and services for which there isn't a whole lot of search activity. In these cases, businesses can't and shouldn't rely on search ads to drive significant business.

But I think it's safe to say that many businesses that give up on search ads give up too soon. Here are some tips that can help businesses struggling to find their way with AdWords and search advertising in general.

  • Don't make assumptions. Choosing the right keywords can be difficult, but it's even more difficult when you make assumptions about which keywords your potential customers are most likely to use. An approach that is sometimes very helpful: ask existing customers what terms they would be most likely to use if they were looking for your product or service through Google. The responses just might surprise you.
  • Get creative. Perhaps there genuinely aren't a whole lot of people searching for keywords related to your product or service. That doesn't mean that there may not be other ways to reach potential customers via search. A tip: think about keywords related to the problem your product or service solves, not keywords describing your product or service.
  • Take advantage of brand keywords. If you have competitors, you may, in some cases, be able to target searches for their brand. Obviously, what you can do and what you should do are two different things, and the advice of competent counsel is certainly worthwhile here. But tapping into searches related to competitor brands is a technique used by some businesses.
  • Track your conversions. Even if search can't generate millions of dollars in profit for you, not taking advantage of what it can deliver means that you're leaving money on the table. By tracking paid search clicks and conversions, you can identify the campaigns that are profitable and keep them running while cutting out the campaigns that are costing you money.

Photo credit: playerx via Flickr.

Patricio Robles

Published 29 October, 2010 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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Comments (4)

Rob Mclaughlin

Rob Mclaughlin, VP, Digital Analytics at Barclays

Great post Patricio.

A persona centric approach really lends itself to search advertising - it helps you understand what questions your potential customer is asking and you can work out when your ad/content may offer value to their journey.

In terms of assumptions and converion I couldn't agree more with this post - a continous cycle of optimisation is essential for performance and efficiency.

over 7 years ago

Chris Turberville-Tully

Chris Turberville-Tully, Managing Director at Inspiration Inc

If only everyone was as honest! We often come across businesses who have been burnt by paid advertising and agencies who claim to understand it. When we explain the realities of paid (and organic) advertising online the shock we see shows clearly what has been going on previously.

Creating a new market is always difficult, we've managed it online but it does take time, effort and as you say creativity to do it successfully. As your tip says, think about the customer or clients pain and when faced with Google box, alone, what would they type in. (You can never do enough or stop doing keyphrase research).

Ultimately though it's cost per conversion that matters as you say, although you need to look at life-time customer value in conjunction to get a true picture of real value.

over 7 years ago

Ian Harris

Ian Harris, CEO at Search Laboratory

Search generally doesn't work for launching new ideas, since people don't search for what they have not yet been exposed to. Therefore consider the display network for launching new products that people may not necessarily be searching for. Also, if you only have a finite set of customers then consider search carefully. For example, if you sell car parts to moror manufacturers, and there are only 10 motor manufacturers, you would be better off calling them up than waiting for them to search.

over 7 years ago


Eperformance SEO

Worth a read of the original article comments on VentureBeat: a regular comment is that they probably didn't do adwords very well, rather than 'search doesn't work for this business'. I think that is the real lesson here, and like any marketing spend, if you don't spend it intelligently in a focussed way, you'll lose money, possibly a lot of money. Adwords is great for almost any business when done right, but for sure it can burn money, but then so can investing in Twitter, Facebook or in running SuperBowl ads. see:

over 7 years ago

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