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Exhibitors of the Google company work in front of a illuminated sign at the industrial fair Hannover Messe in Hanover, Germany (JENS MEYER)
Exhibitors of the Google company work in front of a illuminated sign at the industrial fair Hannover Messe in Hanover, Germany (JENS MEYER)

Part Two: Online advertising

Find your search ad sweet spot Add to ...

In this four-part series, we'll look at online advertising options for small businesses and how to monitor performance once the campaign is launched

Leigh Nash was already a freelance editor when, along with two friends, she realized that there might be strength in numbers. "We decided we could do a better job if we pooled our resources," she says. "So we hung out a shingle together."

They called their firm Re:Word. At first, the three young partners tried advertising in a trade publication, to no avail. Then they noticed that their web host was offering a coupon for Google AdWords.

That was in 2009. Since then, have taken on office space in downtown Toronto and built a successful business writing, editing, and proofreading for corporate, academic, and private clients. Nowadays, according to Ms. Nash, almost all of their business leads come from one place: Search-engine advertising.

Search engine marketing - or SEM, in ad lingo - is the term for the short text ads that appear on search engines. Search advertising has one big advantage over every other kind of advertising; since it's tied to web searches, ads appear in front of users at just the right moment - when they're looking for something.

Most search ads are sold on what's called a "Cost Per Click" (or CPC) basis, which means the advertiser only pays when a customer actually clicks on the ad. Google and Microsoft both offer simple self-serve tools that can get new advertisers started in a matter of hours.

Search advertising is a huge business that Google pioneered and still dominates, though Microsoft is a growing competitor. Google's AdWords and Microsoft's AdCenter are broadly comparable in their approach. Google remains the bigger search engine with the biggest audience and most mature tools; Microsoft, meanwhile, says it offers more precise demographic targeting for its ads, thanks to the information it collects through Windows Live signups.

Getting search-engine marketing to work effectively is a combination of finding the right amount to pay, creating the right ad, and choosing the right keywords to make sure the right prospective customers see your ad - and the wrong ones don't. Here are some pointers for the newly-minted:

Set a budget: With cost-per-click search engine ads, the advertisers names their own price for each one of these clicks. It sounds counter-intuitive, but the name-your-own-price system works like an auction.

Think of it like this: All of the search ads on Google are competing with each other to get displayed first, next to the search results that suit them best. Ads that come up first have a much better chance of getting clicked, so they're all jostling for a good ranking. And the more an advertiser is willing to pay for each click, the more prominently it will be displayed.

This leads to a balancing act for advertisers: Bid too little, and hardly anyone will see your ad. Bid too much, and your ad is bound to attract attention - but if you've promised to pay Google a fistful of cash every time your ad gets clicked, you'll burn through your budget pretty quickly.

Fortunately, Google will give you an idea of what the going rates are for the keywords you're interested in. Evidently, there will be more competition for popular keywords ("cats"; "Justin Bieber"), so ads next to them will cost more. Moreover, you can set limits on how much you want to spend each day, so you won't accidentally bankrupt yourself if you bid too high. After that, it's a matter of watching the results and tinkering.

After months of experimenting, Re:Word found a sweet spot with an outlay of about $20 a day, which gets them a reliable fourth-place ranking for people searching for services like theirs.

"We spend time everyday Googling our keywords seeing where we are," says Ms. Nash.

Choose your keywords wisely: Search advertising is all about keywords. The keywords you specify are what the search engine uses to tell which searches to put your ads next to. Figuring out the best terms to use is both an art and a science, and the subject of endless reworking.

In general terms, the more specific you can be, the better. In fact, it can be worthwhile to actively omit general terms. For instance, although her firm is in the editing business, Ms. Nash has stopped using the generic keyword "editing" altogether, instead going for the more specific term "proofreading." With all its meanings, "editing" put her ads in competition with too many other ads and doesn't bring targeted customers.

Google also offers the option of negative keywords - searches that you don't want your ad to appear next to. Ms. Nash used this to filter out people who were looking for jobs in editing instead of editorial services.

Search engines offer suggestions about which keywords will be the most potent. But your own research is valuable too. Tools from your web host, or like the free Google Analytics package, can show you the keywords that visitors searched for to find your site; these can give clues about which keywords you'd like your ads to appear beside.

Write strong copy: Search ads, like the classifieds of yore, have to do a lot with a little. "If the message isn't compelling, if it doesn't compel them to click on your ad, then you've wasted an opportunity," says Jason Dailey, a sales executive with Microsoft Advertising Canada.

This means writing short, punchy text that includes, what marketing types like to term, a "call to action": The "sign up now!" or "buy today!" urge. It's a good idea to put your keywords into the ads themselves. And don't pad that ad: get your product or service's benefits out front. Don't link every ad to your homepage; rather, send customers straight to the page on your website that's most relevant to the ad they clicked.

Refine, refine, refine: Perhaps most important of all, search campaigns need constant reworking and tweaking. (It sounds like a chore, but many seem to find it addictive.) There's no penalty for changing a campaign on the fly, trying new things, adding and deleting keywords, or trying a different tack. In fact, it's encouraged and expected.

At Re:Word, Ms. Nash noticed that that, among other things, they were spending money on clicks that came in overnight and early in the morning - visitors who were unlikely to be the local corporations they hoped to attract. So she used Google's tools to specify the time of day the ads should run - specifically, during business hours, when corporate clients will be at their desks.

Not every traffic quirk will be so easily rationalized - but they still need to be dealt with. Ms. Nash also noticed that, curiously, interest in editing services spiked on Tuesdays. To this day, she can't quite explain why, but she adjusted her campaign to meet that midweek demand all the same.

"Everyone wanted editors on Tuesday," she says. "It's really bizarre, but you have to stay on top of these things."

Special to The Globe and Mail

The series continues with a new post every Monday for the next month. Stories can be found on the Web Strategy section of the Your Business website.

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