The document discusses principles for choosing keywords for pay-per-click (PPC) ad campaigns using an analytical approach. It presents data on keyword search volumes, costs per click (CPC), and competition levels for different keyword categories. The document finds weak or no correlations between certain metrics like search volume and CPC or competition levels. It advocates grouping keywords by categories like "long tail," "value," or "economy" based on search volume and CPC. The optimal keyword selection depends on marketing objectives like generating leads or brand awareness. Data is plotted to demonstrate budget allocation across different keyword groups.

1. Principles of choosing keywords for PPC ad campaigns – Analytical Marketing Tanmay Saraykar 1 © Tanmay Saraykar – Choosing Keywords 10/21/2010

2. How would you choose keywords? Experience? Opinion? Feel? Instinct? Liking? Brand name? Company name? Logic! There is a better way! The analytical way! 2 © Tanmay Saraykar – Choosing Keywords 10/21/2010

3. How would you choose keywords? The analytical way - Parameters 3 © Tanmay Saraykar – Choosing Keywords 10/21/2010

4. What next? – The process 4 © Tanmay Saraykar – Choosing Keywords 10/21/2010

5. The process - in detail 5 © Tanmay Saraykar – Choosing Keywords 10/21/2010

6. Level 1 categorization and keywords lists Categorization of Keywords Industry keywords Keywords that describe the industry Business Keywords Keywords that describe your business Product /brand keywords Generic product category, your brand name, company name, competitions product names Process keywords Keywords that describe process 6 © Tanmay Saraykar – Choosing Keywords 10/21/2010

7. Keyword lists – Industry, Business, Product, Process Lets choose diverse sets of keywords… 7 © Tanmay Saraykar – Choosing Keywords 10/21/2010

8. Getting lists – Google Keyword Tool Download 8 © Tanmay Saraykar – Choosing Keywords 10/21/2010

9. The data looks like this.. 9 © Tanmay Saraykar – Choosing Keywords 10/21/2010

10. Definitions Local monthly searches - For a specific language and a country, this is 12 months average number of user queries for the keyword. Global monthly searches - The approximate 12 month average of user queries of the keyword, on Google.com and Google search network. This is specific to match type specified. Competition - This represents number of advertisers bidding on each keywords, relative to all keywords across Google. (This doesn’t say how much are they willing to pay!) The estimated cost-per-click (CPC) for your ad for the associated keywords. AdWords estimates your performance using a maximum CPC that is predicted to place your ad always in positions 1-3 with an unlimited budget to capture all available impressions. 10 © Tanmay Saraykar – Choosing Keywords 10/21/2010

11. Should you choose keywords… Should we choose keywords because many are searching by them i.e. they have a high search volume? Or should I choose keywords because they have low CPC i.e. they will cost us less? Or should I choose keywords because they have low competition because no one else wants them? How do we know which keywords will bring us business with optimum use of our money? 11 © Tanmay Saraykar – Choosing Keywords 10/21/2010

12. Don’t get tempted into…Assumptions If a keyword is popular in the US, its likely popular globally Higher the search volume of the keyword, more popular it is, more people are searching for it and hence competition should be high Higher the search volume, more expensive the keyword ought to be Higher the competition for a keyword, more bids it receives, higher should be its CPC Lets see… 12 © Tanmay Saraykar – Choosing Keywords 10/21/2010

13. 13 © Tanmay Saraykar – Choosing Keywords 10/21/2010 Because these assumptions may not be true…lets see if they are true, using Correlation Coefficient..

14. Correlation Coefficient Correlation Coefficient (CoCo)– Relationship between two variables – A statistic representing how closely two variable co-vary Is a numerical value between -1 and 1 (-1) means 100% of the time, if one increases other decreases (+1) means 100% of the time, if one increases, other also increases (0) means there is no relationship 14 © Tanmay Saraykar – Choosing Keywords 10/21/2010

15. Correlation Coeff. For keywords sets related to e-books 15 © Tanmay Saraykar – Choosing Keywords 10/21/2010

16. Visual plotting…. What do these numbers mean? Are they consistent across keyword data sets? Lets see…. 16 © Tanmay Saraykar – Choosing Keywords 10/21/2010

17. Keyword set 1 – e -books 17 © Tanmay Saraykar – Choosing Keywords 10/21/2010

18. Statistical relationships – E-books 18 © Tanmay Saraykar – Choosing Keywords 10/21/2010 E - Books

19. Global Search and Local Search Correlation Coefficient – 0.876 19 © Tanmay Saraykar – Choosing Keywords 10/21/2010 E - Books

20. Search Volume and CPC Correlation Coefficient – -0.153 20 © Tanmay Saraykar – Choosing Keywords 10/21/2010 E - Books

21. Search Volume and competition Correlation Coefficient – 0.264 21 © Tanmay Saraykar – Choosing Keywords 10/21/2010 E - Books

22. CPC and Competition Correlation Coefficient – 0.150 22 © Tanmay Saraykar – Choosing Keywords 10/21/2010 E - Books

23. Keyword set 2 – Indian Food 23 © Tanmay Saraykar – Choosing Keywords 10/21/2010

24. Statistical relationships – Indian food 24 © Tanmay Saraykar – Choosing Keywords 10/21/2010

25. Global Search and Local Search Correlation Coefficient – 0.980 25 © Tanmay Saraykar – Choosing Keywords 10/21/2010 Indian food

26. Search Volume and CPC Correlation Coefficient – - 0.044 26 © Tanmay Saraykar – Choosing Keywords 10/21/2010 Indian food

27. Search Volume and competition Correlation Coefficient – 0.396 27 © Tanmay Saraykar – Choosing Keywords 10/21/2010 Indian food

28. CPC and Competition Correlation Coefficient – -0.008 28 © Tanmay Saraykar – Choosing Keywords 10/21/2010 Indian food

29. Keyword set 3 –Auto parts 29 © Tanmay Saraykar – Choosing Keywords 10/21/2010

30. Statistical relationships – Auto parts 30 © Tanmay Saraykar – Choosing Keywords 10/21/2010

31. Global Search and Local Search Correlation Coefficient – 0.934 31 © Tanmay Saraykar – Choosing Keywords 10/21/2010 Auto parts

32. Search Volume and CPC Correlation Coefficient – 0.038 32 © Tanmay Saraykar – Choosing Keywords 10/21/2010 Auto parts

33. Search Volume and competition Correlation Coefficient – 0.013 33 © Tanmay Saraykar – Choosing Keywords 10/21/2010 Auto parts

34. CPC and Competition Correlation Coefficient – 0.163 34 © Tanmay Saraykar – Choosing Keywords 10/21/2010 Auto parts

35. Lets put it all together 35 © Tanmay Saraykar – Choosing Keywords 10/21/2010

36. Conclusions.. Strong positive correlation between global search volume and local search volume Hence they can be taken as same parameter for the purpose of analysis Weak negative correlation between search volume and estimated CPC This means that even though the search volume for some keywords may be high, not many advertisers are bidding high for them, or they are independent Moderate positive correlation between search volume and competition This means that for a significant number of keywords in this set, if the search volume is high, the competition (people wanting to bid for it, and not how much are they willing to pay) is high. Weak positive correlation between CPC and competition This means that how many advertisers are bidding for a keyword and how much are they wiling to pay are aspects independent of each other 36 © Tanmay Saraykar – Choosing Keywords 10/21/2010

37. So What? Does statistics support our assumptions?..not always High local search volume indicates high global search volume High search volume doesn’t mean high competition High search volume doesn’t necessarily mean expensive keyword High competition doesn’t mean high CPC.. 37 © Tanmay Saraykar – Choosing Keywords 10/21/2010

38. Now what? We need a better way of keyword grouping! 38 © Tanmay Saraykar – Choosing Keywords 10/21/2010

39. Keyword grouping 39 © Tanmay Saraykar – Choosing Keywords 10/21/2010

40. Grouping keywords Long tail – keywords with low search volume and high CPC (small quantities of large number of unique keywords) Value – high search volume and high CPC, you get what you pay for Economy – high search volume and low CPC, may tap a large market but may not be very relevant, pay less – target more Useless – low search volume and low CPC, no one is searching, no one is paying 40 © Tanmay Saraykar – Choosing Keywords 10/21/2010

41. Marketing objectives Genuine leads – Low traffic to the website but only people who care and want our stuff Traffic and Leads – Moderate traffic and moderate leads Brand awareness - More traffic to the website, no matter what traffic Be present – Low budget but want to be in the scene 41 © Tanmay Saraykar – Choosing Keywords 10/21/2010

42. Marketing objectives 42 © Tanmay Saraykar – Choosing Keywords 10/21/2010

43. Keyword grouping Genuine leads Traffic and leads Be present Brand awareness 43 © Tanmay Saraykar – Choosing Keywords 10/21/2010

44. Lets plot some data.. 44 © Tanmay Saraykar – Choosing Keywords 10/21/2010

45. Lets plot some data for Indian food 45 © Tanmay Saraykar – Choosing Keywords 10/21/2010

46. Marketing (CPC)Budget allocation This is what I would do…. 46 © Tanmay Saraykar – Choosing Keywords 10/21/2010