Ignoring the 80/20 Principle
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Written by Atila on October 7, 2008 – 10:30 am
The 80/20 principle, applied to AdWords, states that the vast majority of outputs (impressions, clicks, leads, sales, and such) are caused by a very small minority of inputs (ad groups, ads, and keywords). Instead of diffusing your efforts, focus on the vital few rather than the insignificant many. When you follow my advice and create Best Practice AdWords campaigns, you inevitably create a fair amount of complexity. With so many variables to monitor and juggle and adjust, it’s common to become overwhelmed and wonder, “What do I do now?”
I often see consulting clients who have spend days massaging an ad group that has no potential to make a significant contribution to their bottom line, while ignoring the big keywords in the important ad groups. Keep reminding yourself that the AdWords game is about maximizing outputs from fixed inputs. In this case, inputs are impressions and advertising cost. Spend your time fixing the things that will make the biggest difference:
1. Sort your campaigns by impressions.
2. Sort that campaign’s ad groups by impressions.
Assess the ads in that group do you have a clear winner?
3. Sort keywords by impressions, and look at the top five keywords.
Are they making you money? Do you need to adjust their bids? Peel and stick them into a new ad group? Pause or delete them? Here the number of impressions is your limiting factor. If you have two ad groups, one with 50 impressions a day and the other with 20,000, a 50% improvement in conversion might translate into one additional sale a month for the smaller group and one to two more sales a day for the larger group. Where do you want to spend your time?
