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If you rely on PPC traffic you better read this. This is precisely what I have been warning is going on - especially with AdWords - written from the perspective of a domainer.

From the page: "Ultimately, an advertiser’s dream is that 100% of clicks convert to sales but the problem is that this is a VERY small percentage of the overall click volume. If Google and Yahoo were to truly only pass on "quality" clicks then we would have an affiliate not a PPC system.

What this means is that both Google and Yahoo are right now actually passing on "sub-standard" clicks to advertisers. For example, a games company may purchase a keyword for $0.95, knowing that only 10% of clicks convert to a sale. The fact that there is only a 10% conversion rate indicates that they have paid for sub-optimal clicks.

The reason why the advertiser receives these clicks is a volume issue. Google and Yahoo essentially say, "We can give you 100% conversion on only 1 click or you can have 10% conversion on 10,000 clicks." If all advertisers selected the 1 click option then Google and Yahoo just went out of business. The name of the game for Google and Yahoo is how many clicks can they deliver and yet still have happy advertisers with a conversion rate high enough to keep on spending on PPC."
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from john2k 2520 Days ago #
Votes: 0

Merchants have a responsibility in this equation as well.  They need to successfully convert those visitors/clicks into paying customers.  Some are not very good at doing so, which really isn’t the fault of the PPC provider.

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from flyingrose 2520 Days ago #
Votes: 0

While I absolutely concur that conversions are the most important factor in online success and most sites do a very poor job of converting their visitors into customers, it is the ability to measure conversion rates that causes this traffic quality issue to be so obvious. All traffic is NOT created equal. If anyone can show me a site that is every going to generate strong conversion rates from ads volunteered by parked domains and searches for profiles, videos, and music on social networking sites like MySpace that I’ve got to see.Only traffic quality problems can be the root cause of conversion rates swinging wildly back and forth between 1.5-2.5 and 0.3 for the same advertising to the same landing pages. This type of erratic behavior is unacceptable. It is clear to me that only a better computer program will be able to control algo-based systems like AdWords.

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from TimDineen 2520 Days ago #
Votes: 0

"only a better computer program will be able to control algo-based systems like AdWords"?  What does that mean? 

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from TimDineen 2520 Days ago #
Votes: 0

And if 10% (or 1.5%) conversion rate isn’t acceptable, what is? Adwords clicks are expected to convert 100% of the time? Since you are talking about PPC, not domaining, I’ll take it a step further. Google offers a keyword-based search. How are they to know exactly what level of readiness the shopper is at or, more specifically, whether they are an "Exact Match" for the keyword you are advertising? Sometimes people search for the exact keywords you may be advertsing and still that doesn’t make them a perfect fit for your product. How can Google know whether a person will conversion - especially if there is an Exact or even Phrase match?Google can’t control when/if a shopper is ready to buy... if they’ll like your product... if they like your website... your prices... your checkout functionality...

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from aimClear 2520 Days ago #
Votes: 1

The is an AWESOME dialog.

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from TheRealTerry 2519 Days ago #
Votes: 0

Yeah, this is totally removing the advertisers responsibility in determining the search patterns and terminology of their audiences. As well, we all know, or at least should know, the concept of casual searching vs. researching vs. buy keyword phrases and how to appropriately provide creative/landing pages/ and bidding to best convert. And you can even go a step further and say that immediate conversions are not your only objective, depending on your offering. Building brand strength and fostering a conversion at a later date are also objectives that can met that are not trackable like conversions.I think it might be reasonable to say that search engines are not intentionally going out of their way to do your marketing work for you, but then, that’s not a reasonable thing to expect anyhow. You gotta do the work to get the payoff, sorry, PPC ain’t an ATM machine.

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from TheRealTerry 2519 Days ago #
Votes: 0

And to add, traffic quality is a function of the keyword choice, negative keywords being used, and the biggest single most important thing to qualify your traffic is the ad copy.  I had a client once who was getting great click through rates and conversions, but their product was for 65 and older only. By simply saying this specifically in the ad, we improved our quality of traffic on the spot.Point being, while "Free Money Secrets!" gets people in the door, "Free Investment Consultation" is going to filter out the riff-raff and leave you with the people looking to actually invest.

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from flyingrose 2519 Days ago #
Votes: 0

@TimDineen - The issue here is not the ability of a site to convert - it is the intentional dilution of traffic quality by the ppc engines. You ask "And if 10% (or 1.5%) conversion rate isn’t acceptable, what is? Adwords clicks are expected to convert 100% of the time?". Most advertisers would LOVE to have a conversion rate of 10%; however, the main issue here is consistency/predictability. A site will normally convert at a rate that is fairly predictable averaged over any given time period. Whatever the conversion percentage is, the advertiser can set advertising spend so that they are not losing money. When manipulation of the quality of the traffic causes your stable conversion rate to suddenly drop from 1.4% to 0.3% as shown in the graphs I posted at http://www.ppcthink.com/2007/10/27/poor-quality-traffic-equals-low-conversions/ while simultaneously increasing spending, the potential losses are a higher risk than many advertisers are going to be willing to make. How much you can afford to bid and spend is set based on your average conversion rate. If you can stabilize neither the conversion rate nor the spending manually (as many have been doing for years and I have been doing since 2003) the only way to protect the advertiser is through implementation of a computer program sophisticated enough to immediately correct for these types of issues. Ironically, it may be the interaction of these various programs that is causing the volatility we’re seeing! Every time Google changes and all those automated tools adjust that will trigger Google to change more and so on in an endless loop. Just as some of us are doing our best to learn to live consciously we have created computer programs that are in the same type of endless tit-for-tat react mode that is humanity’s greatest weakness. @Terry - traffic quality USED TO BE "a function of the keyword choice, negative keywords being used, and the biggest single most important thing to qualify your traffic is the ad copy." That is NO LONGER TRUE. If Google displays your ad at the top of the page for totally unrelated searches on social networking and volunteers it for canned searches (i.e., no one typed the words into anything) parked domain sites what used to work will not control traffic quality.

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from ryanol 2518 Days ago #
Votes: 0

my perspectivecontent network = brand building, anything more is gravysearch network = the honey biscuit as long as I can get a dime for every nickel I give you, guess who’s gonna have a lot of nickels?

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from Chris1 2518 Days ago #
Votes: 0

Its true that Google does partner with sites that do not convert as well as searches from the domain www.google.com.  It has been like this for a while and I expect it will remain this way.I noticed about a year ago that our traffic from Google was increasing while our conversion rate was going in the opposite direction.  What I did was set up duplicate campaigns that are exactly the same, only with bids at 75% of the original campaigns.  I opted the original campaigns out of the Google network traffic so that they would only get Google traffic (which converts very well).  With the new campaing, I opted those into the Google network (not content, but the partner network).  Since the campagins were exactly the same only the bids were 25% lower, these campaigns would get virtually no traffic from Google and all the traffic from the partner network.  That way, I could easily compare conversion and set seperate bids from each of these sources.Its kind of a pain to manage and test, but I found that in many cases, the conversion from the partner network was significantly lower.  In some campaigns, I saw little to no difference in performance between the partner network and Google-only traffic, so it was easy to delete the new campaigns and opt the original back into the partner network traffic.  For those campaigns that I did see a significant drop in conversion, I’ve found that it makes a huge difference to have seperate campaings with seperate bids.  This has allowed us to beat all of our competitors on Google in our most important campaigns while still possessing the ability to great ROI and some volume from the partner network as well.Not a perfect solution or situation to the Google traffic dilemna, but it seems to be working well for me.

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from john2k 2517 Days ago #
Votes: 0

flyingrose, you mentioned that "All traffic is not created equal."  Are you referring to traffic on various Adsense publisher sites?  Would a good solution to you be for Google to enable advertisers to bid differently or opt out of specific sites?  Adsense, the way I see it, is very much of a RON type system - so it makes sense that some sites will perform better than others.In regards to the inconsistent conversion rates from your PPC advertising, I wonder if the actions of other advertisers could be causing some of this inconsistency?As an Adsense publisher I also notice a great deal of inconsistency on a day to day basis.  There are days when the eCPM is very low and then days where I am shocked to see how high the eCPM is.  I often attribute this inconsistency to advertiser campaigns changing, budgets running out, competitive sites draining the Adsense funds, etc.So, in relation to your issue, maybe the times you see lower conversion rates are when other advertisers keywords are active, resulting in them getting the higher quality clicks and you getting what’s left of the lower converting traffic (traffic that is usually left to other advertisers when your conversions rates are good).  This is just a hunch and food for thought.

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