Feb 24, 2014

How to "Cut & Patch" in Paid Search


My PPC team started using this term so frequently that now we officially call budget optimization as "Cut & Patch" analysis which simply means identifying those portions of the paid search campaigns, where spending is not necessary; cutting costs from there and provide more opportunities to the revenue generating areas. This activity is required to seize any possibility of wasting client's money and provide more results with same budget in hand.


This analysis requires an aggregate data of at least a quarter, but if your account spends huge then you can do it on a monthly basis. Just keep in mind that whatever report you are generating, most of the rows of that report should be filled with statistics. If the report has less data then the analysis will not provide good actionable insights.

Following are some key areas from where budget can be saved:

Keywords

Identifying cost sucking keywords, is the easiest and important step to save money.
  1. Pull a keywords report for last 90 days.
  2. Sort descending by cost.
  3. Apply formula to calculate spending percentage against total.
  4. Check the conversions, revenue or any other performance factor to see the profitability of keywords.
  5. Pause or narrow down the match type of non-profitable keywords with high cost.
Match Types

If your account uses all match types then this is a must-do analysis to check where your cost is running.
  1. Pull a keyword report.
  2. Use pivot table to aggregate the data for match types you are using.
  3. Check profitability of each match type by comparing it against overall performance.
  4. Pause low profit keywords or change them to the better performing match type.
Devices

There are very less options for optimization in this field, but traffic volume is the deciding factor for whether to check this report or not.
  1. Pull device performance report at campaign level.
  2. Compare the profitability of various devices.
  3. Either reduce the bids on poor performing devices for a campaign by some percentage or improve the performance of your website on that device.
Geography

This report is important if you advertise across nations or within a huge country.
  1. Generate a geographic report at campaign level, segregated by states or even cities if you offer specific products till that level.
  2. Build pivot tables to aggregate national/state/city specific data.
  3. Check which geographies are doing better for your products.
  4. Either exclude those regions that are not generating profits or build specific products for that region and setup a separate campaign.
Network

This is a kind of quick look report and you can easily compare between performance of search and display network.

  1. Run a network report at campaign level.
  2. Check the cost consumption & profit generated by both the networks.
  3. Reduce budget on non-performing network.

Display Network

This report is equally important as keyword report for advertisers spending more on display network.
  1. Pull a placements report at ad group level.
  2. Sort descending by cost.
  3. Analyze the profitability of websites where the display ads are showing.
  4. Exclude non-profitable placements.

Ad Copies

Ad copies are something that doesn't retain historical data once changed, but can be analyzed if account receives huge impressions and clicks.

  1. Generate ad copies report.
  2. Check cost vs. conversions.
  3. Pause or change the ad copies with low profitability.

Destination URLs

The key to conversion are the landing pages, where user reaches after clicking on the ad. Checking how much you are spending for each page is a wise act.

  1. Run ad copy report.
  2. Remove additional tracking parameters from the destination urls.
  3. Build pivot table to aggregate destination url data.
  4. Check the number of  conversions generated by every destination url.
  5. Change the pages or build new pages to run A/B testing with poor performing destination pages.

Search Terms

These are the actual words entered by users on search engines to find and click on your ad copy.

  1. Fetch a search terms report for all search campaigns.
  2. Remove the terms from sheet that are already used in the campaigns.
  3. Check for both profitable and non-profitable search terms.
  4. Add non-profitable search terms as negative keywords and profitable search terms as positive keywords with the most performing match type in the account.
Apart from these reports there are other areas such as ad extensions, re-marketing, duplicate keywords etc. can be checked to see how the budget is getting used and actions can be taken accordingly.

Feel free to suggest your Cut & Patch ideas with us in comments section.

Image Courtesy by patpitchaya / freedigitalphotos.net

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