Are you competing in a high-stakes PPC market with bids in the $25 to $40 range? If you are, don't simply fight your competition head on; if you do, you'll end up paying premium prices for clicks you might capture for far less. There are several shrewd approaches you can employ to side-step your less-vigilant competitors. We've learned a few valuable tricks that can earn you valuable clicks for less-than-premium prices. The techniques begin with carefully monitoring PPC activity throughout the day to discover low-competition time slots in the PPC bidding and striking while your competition snoozes.
Getting Started
The types of campaigns for which these techniques will work will be high bid environments with smaller but determined competitors. You want to look for competitors bidding for terms in the $20-and-up range, but whose campaigns are not fully budgeted to run at the maximum number of available clicks. Specifically, we want to look for competitors' ads that don't appear consistently or whose ads disappear later in the day. Smaller competitors tend to fit this model fairly often. An illustrative keyword example we see in our local market of Austin Texas is "Personal Injury Lawyer". We know the bids in that space are $24 to $30 depending on the time of the day--but we see some advertisers drop out at various times of the day. For illustration, we'll examine Google's Adwords system, but these principles will apply to any PPC program.
Identify Your Competitor's Ad Schedule
Google's Adwords system has a scheduling feature that allows advertisers to run ads during particular times of the day, and even enter positive or negative bid adjustments based on times of the day.
Here's the catch: the Adwords system only allows the scheduling to be made in increments of 15 minutes, as shown in the screenshot below.
So, if your PPC competition is employing the ad scheduler, it become fairly easy to identify when they stop running ads by running test searches throughout the day at 15-minute intervals. Once you've identified a competitor using the ad scheduler, you've just found a soft spot--your bid competition will be lower during the times of the day when that competitor isn't bidding on ads. If you can identify more than one competitor, then you've found and even more favorable environment.
Identifying Competitors' Under-Budgeted Campaigns
There is another way to determine soft spots in PPC bidding: look for under-budgeted campaigns. You can identify your competition's under-budgeted campaigns fairly easily. An under-budgeted campaign is one where the advertisers daily budget will not supply the maximum number of clicks available to that advertiser. So, say a competitor is paying an average of $20 per click for a particular keyword; assume further that their daily budget is only $60--yet there are ten clicks available to that advertiser.
That advertiser has only budgeted enough to purchase three clicks, so Google is forced to economize ad delivery--and it gives advertisers only two choices: standard delivery and accelerated delivery.
Standard delivery means that Google will spread the ads throughout the day. In practice, Google might show an ad every third time a keyword is searched. Accelerated delivery means that Google will simply show an advertiser's ads every time they are triggered by a search query until the advertiser's daily budget is exhausted.
There lies the opportunity: if your competitor is employing the accelerated delivery method with an under-budgeted campaign, that means their ads will eventually stop running at some point during the day. You'll know that your competitors are employing accelerated ad delivery if their ads show consistently in the morning (in 99% of cases, advertisers set their time zone correctly so a Google Adwords "day" begins in the morning) but their ads disappear at random times in the afternoon from day to day.
Outsmarting the Under-Budgeted Competitor
So, how can you capitalize on a competitor that employs accelerated ad delivery? Say your competitor is fighting hard for position one for a particular query and will not yield on their bid price in order to stay on top (that's a fool's approach, as we'll see). You can force your competitor to exhaust their budget more quickly by simply raising your bid as high as you can without dislodging the competitor from position one. Google's bid price calculation system takes care of the rest: Google adjusts the actual cost-per-click to be based on the dollar amount needed to exceed the "next ranked ad." If the next ranked ad (you) has a higher bid then the ad that got the click (your aggressive-bidding competitor) costs more. Thus, you can knock your competitor out earlier in the day while at the same time increasing their cost-per-click. Be warned though, you will, of course, be raising your bid, so you could potentially wind up paying more for clicks you do get.
Now to Enjoy the Lighter Competition
With your competitor's budget exhausted in the later hours of the day, the competitive bidding for a particular keyword/keywords thins significantly. If circumstances line up properly, you can lower your bids in the afternoon hours and enjoy far less expensive clicks, and better click-through rates (and, ultimately, higher quality scores). There are two ways to approach lowering your bids in the later part of the day.
The first approach employs the advanced "bid adjustment" feature in the Adwords ad scheduler described above. To use the bid adjustment feature, log in to your Adwords account, click on a campaign, and then click the "Settings" tab. From there, scroll down to the Advanced Settings section and select "Schedule: Start date, end date, ad scheduling" and then click on "Edit" in the "Ad scheduling" subsection. This will reveal the ad schedule pop-up window (shown below). At the top of the pop-up window, you want to click "Bid adjustment" mode. You can then set specific time periods on specific days and apply a percentage multiplier to lower your bid. In the screenshot below, we've adjusted our campaign from 4pm to 7:30pm to adjust our bids to 72% of the standard bid. At all other times, our bid prices stay at the standard bid prices we've selected. There it is, we've just adjusted our bids downward to enjoy the lighter competitive market we've identified that takes place during later hours of the day.
There's a second approach to lowering bids later in the day that is a bit less elegant, but still effective. The second approach involves simply creating two ad campaigns: a first campaign scheduled to run during the earlier, more competitive hours of the day, and a second campaign with lower bid prices that is scheduled to run from say, 4:00 p.m. to 7:00 p.m. The advantage to this approach is that you'll have separate analytic data for the separate campaigns. We prefer this second technique for specifically this reason.
We hope you've learned a bit from this article. While a bit Machiavellian, the techniques we've outline can help in competitive markets, and certainly the lessons here can be transposed into your daily PPC activities.
Good post. The only thing I would add is that you do need to be careful here and follow-up on conversion rates etc.
If a competitor is dayparting around a certain window - there might be a very good reason.
Agreed - when analysing data it's important not to jump to the wrong conclusion - saying that by creating a test campaign / budget it would be easy to work this out through click through rates vs conversion rates, the best thing about PPC is you can act relatively reactively to turn things off if they're not working properly.
Overall, good thinking on this one.
I Agree - I find that I have highest conversion rates within a few hr span each day!
Nice tip Michael.
Now we need a method to automate the time interval checking across x number of keywords and competitiors!
That's called Google Conversion Optimizer.
I agree with the advice listed here, but isn't it a little silly to assume that companies competing in the $25+ CPC category would be operating with accelerated ad scheduling?
Surprisingly, it's quite common. We have seen this model play out in several markets.
Deleted everything else I wrote so as not to get into too much trouble ;)
I have seen incredible bidding from some of the most well known agencies with the biggest clients - take the money, run the software, forget about it
Yes, I have seeen this too. In fact, I have even been party too it myself. This is really good insight. Then the only question is what happens when you run up against the guy with the unlimited budget. Again, great insight, I'll be testing this out next week.
Thanks - Cap
This is good advice. However, I would advise people not to skimp (or lose faith) on the ad testing and creative side of PPC. Any campaign at these CPC's and worth day parting to this extent is also worth a massive amount of ad testing. If the search activity is low on some of these $25+ KW's (as it can be), why wait for Adwords data to trickle in? Ask co-workers, friends, family, pets - anyone about your latest ad designs, so that you hit the sweet spot sooner than anyone else. A punchy ad with a great quality score is an awesome weapon in smashing competitors. After all, many of these $25+ CPC arenas are a little stale when it come to ad ideas...so, always be brave, always be different, always be testing!
In addition to this I would evaluate what your competition is doing with something like spyfu or another program. Then you can find out what they are bidding on.
I like the concept, but maybe a more efficient method would be to use the hourly dimenssions in adword to get a view on impression share by hour, cpc by hour you can then analyze where opportunites lie by capturing missed impressions or by an opportunity to bid less - this can then be actioned with the ad scheduler.
While I think many of us try to find the most effective way to manage high-stakes PPC, I think this article explains it best. And it's not just that the blog goes step-by-step, no, it's that it gives the details with an example.
What a great find this morning!
Its useful information..
Just a note but I personally use the Ad scheduler in campaigns, particularly when I can review CPC data over the longer term, so your competitor may not be scheduling ads for a good reason. With your cost daa I'd say you needa at least a minimum of three months but say if you have data over years this is really helpful as you can spot trends.
I've found generally there is a always a period where you don't want to be putting 100% bids on. Entirely depends on the niche but for some niches I've found in particular lunch hours which can be 12 - 1 and 1-2 there is a lot of heavy clicking with low intent to convert so costs rocket up, this is due to workers on their lunch hours who have limited time to search. The other trend I've spotted is particularly in b2b markets rush hour can often sky rocket CPC.
Also a lot of the post can be applied to low end as well as high end markets.
I want to know, does day-parting helps in reducing CPC? Because Google doesn't charge according to the bid. Actual CPC is lesser than the bid. How does it help if we reduce the bid during later part of the day?
Quality post, enjoyed reading it. Sometimes u learn, sometimes you don't.
This is a good strategy for attacking your competitor, but I think you have to take into consideration the amout of conversions you get based on day parting. In the end if you're bidding more at these times and not getting any conversions it's really not worth it. We battle this constantly in the highly competitive markets. Just make sure you know where to pick your battles when you're day parting but great info
Another thought to compete in such a competitive market ... is to enhance the backend marketing of the client so that more money can be spend to acquire the customer in the first place.
Love the delay ad scheduling - very clever.
Great ideas for pushing your compition out of the way but here's my question. One of my clients used to work for (maybe i shouldn't say) and says that they used a website that would tell them what a competitor was paying for a keyword so that you could go right in below them. However I've searched and haven't found anything like this. If anyone knows can you please inform me.
the developer in me now wants to build a tool to crawl a serp every 15 min and try to display the competiors it finds and when they seem to show up / drop out
Some great stuff in this post, really enjoyed reading it.
Don't forget to scour that search query report for possible negative keywords and ideas of where to get more negative keywords. Advertising for a bank? Be sure to exclude blood bank, phone bank, food bank, etc. Wikipedia disambiguation pages can give you a lot of ideas of things to add before you waste impressions on off-target ads.
Nice tips, these are things I hadn't thought of. Thanks!
Love it - some great sneaky tips in there to pray on the weak... and the ad scheduling tips are also useful for campaigns with lower CPCs.
I like the way you go with the day parting segmentation to find a niche.
You could go one step further and be the king of the night. If your client's industry makes is possible, target people awake/working during night times, most of the time you would find yourself alone on top keywords. The night time advertising would requiere specialy tailored ads though!
I would add that there are other ways to outsmart your competitors:
- Go Long tail keywords which tend to be cheaper but it's not always the case is high stakes keywords
- Go Re-marketing
- Go with similar users campaigns
- Improve your Quality Score, it will reduce you CPCs thus more click for the same budget
- Make sure that every penny counts
Going head on with competitors with higher budget means that you need to be sneakyer and find your niche where you will be the biggest spender.
Very Good information, I came to know many that I don't know. One more thing I would like to share.
My IMP. idea to beat PPC Competetors: There millions of people doing PPC to increase sales of thier products or services.
Take a example: If you are selling software tools then most of people start their Title using software name & its very common. So what to do to increase CTR? Ans is try wierd kind of words to increase clicks like Title name: "Name of service or product(SEO/PPC) That Rocks" [SEO Soft. that Rock]. Try this, you will get more CTR on normal or common keyword. For sure, Lets HOPE it will works.
Do you know of software that will deterrmine the ad scheduling? Beacuse I'm not going to have an employee checking at 2AM for opprutunity.
Good one for the PPC side of the house! Dayparting is a great strategy to implement.
Viewing clients historicals may help also.
Cheers
Dayparting is definitely an interesting technique. Like you mentioned above though, if the top advertisers (positions 1 2 and 3) are using up their spend early in the day, there shouldn't be a reason for you to change your bids since your actual spend is just $.01 then than the next advertiser. I DEFINITELY see those periods of low competition time, and that's what skews the daily average position for a keyword sometimes. With a "top vs other" comparison, you can see the lows and highs of your position, which can also indicate that there are low competition times available! Thanks for the post... interesting read!
Hey, something I know about!
You can get a high-level look at Average Position parted by Hours of the Day in the AdWords interface. In any campaign, you just click into Dimensions and elect Time --> Hour of Day as your View. (If you're a Google Analytics person, the functionality will remind you of segmenting and filtering in that environment.) I do this occasionally to look for trends, or at least alert me to parts of the day which warrant closer study with the Ad Preview tool.
I really liked this post, which reminded me of my beginnings as freelance (at that time I was also offering AdWords services). But I cannot cancel from my mind the image of Sem pratictioners as being almost the same as the Wall Street brokers ones... If you think it all this post is about speculative maneuvers :).
interesting comparison.. Wall Street to PPC ha ha
For the thumb-downer... my metaphor was not a negative judgement... I was correlating the two figures just for stress both profession have in common... and because both are about bidding :)
I get that. I work in PPC almost exclusively at an agency, and I often find myself thinking in poker terms, as in 'what will I pay to see this flop?' And then I think how that math might change if my landing page were better, if I suddenly have a different understanding of what a particular query is telling me about intent, etc.