Profit Maximization Algorithms

 
Are your paid search marketing strategies stuck in the past? 5 years ago your computer would probably have half the CPU speed, a quarter of the RAM, and a tenth of the hard drive space than common computers today. Growing competition is causing SEM bid management strategies to change just as quickly.

Small campaigns that used to provide high volumes at low cost have now been replaced by large lists of long tail keywords. How can you avoid missed opportunities by investing your scarce time and budget with the highest efficiency and profitability?

How can you identify which situations must be handled by a real analyst and which parts of your account can be automated? Once the highest priority bid adjustments have been reviewed by human eyes, how can bid rules be taught to use the same decision framework on the rest of the account?

How can bid algorithms be organized to maintain clear logic while optimizing to the most appropriate metric for each keyword segment? How can bid rule templates be adapted to fit the metrics and thresholds of your unique situation? How can new functionality enable you to more effectively leverage the rich data sets you are already collecting?

Many search marketers used to focus primarily on return on ad spend or cost per conversion. How can you ensure your efforts are truly improving the bottom line by including offline conversions, cost of goods sold, and other factors in the calculation of real profit?

Even the most experienced SEM professional is limited in the number of intelligent bid decisions that can be manually applied in a day, but certain parts of any PPC portfolio are too critical to turn over completely to a machine. We must embrace both methods of bid management – manual adjustments and automated review.

Successful marketers will learn how to embrace both methods of bid management so that more time can be spent on the holistic strategies of 2010.

Once manual and automated bid management has been adopted and balanced according to key performance indicators that are lowest in the funnel and closest to real profit, paid search marketers are more available to dive into other campaign management tactics that really pay off. Use both brains to optimize bids towards profit then review raw queries, refine match types, improve targeting, align relevant messaging, and test landing pages.