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Increasing ROI by applying modern portfolio theory to Pay Per Click Optimization.
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from EricLander 1160 Days ago #
Votes: -2

Sphunn for creative use of Awesomization in a title.

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from DrPete 1160 Days ago #
Votes: 0

Nice thoughts on ROI - I tried to comment but got a Javascript error of some sort. I’ve seen situations where even just splitting out 1 or 2 ad groups based on ROI worked miracles. The bad performers tend to also be the broadest groups with the highest impression count, and they’ll suck a PPC budget dry.

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from bbcarter 1160 Days ago #
Votes: 0

Ya, as I was proofing this, I wondered "is this strategy too obvious?"  It certainly seemed that way after doing it and writing about it.

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from crimsongirl 1160 Days ago #
Votes: 2

I don’t get it.  The blog post mentions Modern Portfolio Theory and even links to a Wikipedia page on that theory, but the technique he describes has nothing to do with MPT.  MPT involves accounting for risk in investments as quantified by performance variance and his technique doesn’t do that.  In fact, it assumes no variance in performance.  Ad groups are assumed to always produce the same ROAS.  There is no accounting for risk.I don’t get the use of the phrase "graduated campaign budgets."  What’s graduated?All he did here - if I am reading this correctly - was look at which ad groups had higher ROAS than others and then allocate more money to the better performing groups.  Isn’t every diligent PPC manager supposed to be doing that periodically?

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