Efficient Frontier Insights

Follow the data...not the position

When we take onboard new clients, we find that some clients have a predetermined idea on which position on the Search Engine is the best. Some advertisers believe position 1-3 on Google is a must. Putting aside any branding or defensive PR reason for being placed at number one, one of the first things we try to educate new clients is to let the data dictate your Search Engine Results Page (SERP) position.  The following case study shows the importance of letting the data work its magic and give you a better ROI.
 
Recently, a German travel client used more than 3900 keyword constraints in order to influence its overall performance. A keyword constraint is the maximum/minimum CPC or maximum/minimum position rule for each individual keywords.  Soon, 90% of the daily budget was used to fulfill these constraint targets and only 10% of the budget was actually used to optimize keywords and increase real performance.
 

By taking away the majority of constraints, the complete daily budget was available to have the keyword market develop and to use the data generated from Efficient Frontier's portfolio optimization technology. Monitoring the performance very intensely, the following development was encountered.

When looking at Efficient Frontier's simulations this step became even more obvious. When the constraints were taken away, uplifts can be expected immediately. In this case, we saw an ROI increase of 96% (day to day) and 45% (week to week) just by taking away keyword limitations and letting the invisible hand of the optimizer take over. Since then, the free market environment has allowed the performance to improve continuously.

So if ROI is your key objective,  resist the need to seek the top SERPs positions and liberate your keywords from their constraints to improve performance and ROI.

Julian Stank
SMS Hamburg Germany

Motley Fool UK Case Study at SMX London

Last Friday Jonathan Beeston, our UK Director of Client Services, presented a financial services case study at SMX London. Fool.co.uk started optimizing (or optimising, as they write in the UK) their search campaigns using Efficient Frontier's bid management technology in April 2007, and within two weeks experienced a significant increase in volume and decrease in CPA. After just one month volume had increased by 83% and CPA had dropped by 43%.

We didn't stop with just bid optimization for Fool.co.uk - we also helped expand their keyword list into the long tail, restructured the campaign, and expanded the campaign from just credit cards to loans, mortgages, insurance, and banking. We also refined ad copy, conducted keyword testing, landing page optimization, and match type expansion, and made use of our simulations and forecasting. 

Fool.co.uk is one of the leading finance sites in the UK, with over 2 million members and 600,000 monthly visitors. Their search marketing efforts are helping to increase value for partners and grow the site even more. The past six months of algorithmic campaign optimization combined with smart search marketing practices have resulted in an overall drop in CPA 86% and an increase in click-out value of 320%.

This example is what makes search engine marketing so interesting - it's not very hard for an advertisers to cost-effectively acquire new customers through search, but the additional investment in optimization can produce results that far exceed expectations.