Depending on business objectives, Paid search advertising or PPC SEM management strategies must be planned with ends in mind, yet the best path to take might not be so simple or obvious and it's easy to optimize yourself out of performance. Pay-per-click search engine marketing crosses marketing-funnel levels from awareness to preference.
Examples of objectives are brand awareness, lead generation, direct sales, or a combination. Variables such as multiple products targeting multiple audiences significantly influence strategy design. PPC marketing objectives must take into account that actions occur at various levels of the marketing funnel and are not unaffected or mutually exclusive from other marketing strategies, both online and offline. For example, online display and offline advertising demonstrably raise search activity.
Rules based PPC strategies (heuristic modeling) focus on one or a few easily tracked variables to achieve a predetermined metric such as click through rate (CTR) or cost per action (CPA) such as leads or sales. This strategy is usually implemented to measure individual keyword performance. Tactics may include adjusting bids for changing search results rankings, day parting, and copy and landing page testing.
Portfolio based PPC strategies employ a robust management tool that uses algorithms to account for a wide variety of variables in order to implement variable combinations to discover best results.
For example, if the objective is to achieve a $20 cost per action, it’s easy to see if each keyword is achieving that goal. If a variable cost per action is considered such that one keyword results in a $15 CPA and another in a $25 CPA, a per keyword rules based strategy might cause spend to be raised on one keyword and lowered on the other, but a portfolio based approach might consider other variables and suggest a more counterintuitive strategy.
The above very simple example shows that the two different keywords meeting the rules based goal of a $20 CPA do not maximize sales. In fact, the two keywords falling outside the rule maximize sales at a higher spend. The counterintuitive implications are more complex than the much simpler rules based strategy. Keywords 1 and 2 could be easily replaced or added to with creative content 1, 2, etc. and landing pages 1, 2 etc. which would illustrate the complexity and volume of variables needing computation to achieve optimized goal results.