Paid search has become the crowd puller of performance marketing and the appeal of it is based on more than simply high measurability and transparency. It’s effectiveness is indisputable. Regardless, eventually opinions are divided regarding one topic: The Long Tail. What many have dismissed as hot air, for us is actually a practical way to make PPC campaigns more profitable. Therefore, I want to show you why you should look at Long Tails (Part 1) and what you have to keep in mind implementing them in your PPC strategy (Part 2).
Where the borders between Long Tail (keywords that are made up of multiple words) and Short Heads (commonly searched terms with few words) stand, is a heatedly discussed sticking point. The fact is, leaning towards the theory of Malcolm Gladwell, long tail keywords generate less traffic, because they are more specific and are not commonly searched. The difference here is important, because various types of keywords can more or less reach varying KPIs.
Information from search term key figures
If you want to compare the performance of Short Head and Long Tail, don’t compare the keywords which are actually entered. Why? Because Short Head keywords often intercept Long Tail keywords, making the results inaccurate.
Instead, we analysed key figures from search queries, for example from the search query report. In the examined case, you first consider the click rates and impressions for an entire month in relation to the number of words in a search query.
This is certainly no news for good old PPC hands: Short Heads reach a large part of impressions, which decrease based on the average increasing length of the search term. Therefore the click rate of an increasing word count of a search query rises. In the examined case, the CTR of a keyword with 5 words is 254% higher than a keyword with only one word.
Better click rates, higher quality scores
Assuming the quality of the landing page, the use of ad extensions and the relevance of the ads are stable factors that are common to all campaigns, the click rate is the main component for the calculation of the quality score. As is known, a high quality score means that the necessary CPCs for good placement in the paid search sink, which saves on the budget and enables funding to instead be funneled into other (more) profitable points.
If someone looked at their own account, they would surely come to the same conclusion: Long Tail keywords have much better click rates and quality scores. That means: if Long Tail was considered in the PPC strategy, a part of the budget could be saved. But just to save on the budget wouldn’t be helpful in the long-term with running profitable PPC campaigns and maximising the profit. For this very reason it makes sense to take into consideration how much profit – dependent on the length of the keyword – per click is left over.
Long Tails with higher profits per click
Profit plays an increasingly important role in the efficiency analysis of PPC measures. It is a trend adjusting keywords directly based on their profitability and no longer based on the number of their preliminary conversions or the revenue that they generate. Key figures such as conversions and revenue cannot 100 per cent guarantee that PPC campaigns will really play out profitably in the end.
In the given example, new key figures are decked out in familiar clothes when observing the profit: The following figure shows the cost-turnover ratio, which is defined for this analysis by the ratio between the CPC (Cost-Per-Click) and the EPC (Earning-Per-Click).
Analogous to an ordinary cost-turnover ration analysis, it becomes clear that the ratio between expenditure and profit improves with the increasing number of words in a search query. In the evaluation presented, the cost-turnover ratio dropped by 95%. In the end, there’s more profit left over by Long Tails than in the case of Short Heads. Paying specific attention to Long Tails can raise profits and improve the cost-turnover ratio.
Do you share my opinion? I’m happy to discuss your thoughts with you in the comments section. On Thursday I’m going to tell you more about what to keep in mind regarding the Long Tail.