An Introduction to Inventory-Based Advertising. White Paper April 2015 by Dan Tallarico

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1 An Introduction to Inventory-Based Advertising White Paper April 2015 by Dan Tallarico 1

2 What is Inventory-Based Advertising? Inventory-Based advertising is the method of advertising specific products on Google AdWords in order to capture a customer s attention when they re ready to buy. By buying only laser-focused keywords you can build highly effective ads because you can better predict the customer s intentions. These ads leverage inventory to create hundreds of thousands of online ads, complete with generated ad copy, landing pages and affordable keywords. By using the [exact match] and Diagram Bill & Walt Inventory-Based Ad Campaign in phrase match capacity of Action Google AdWords, you can ensure that you re targeting customers who are searching for highly specific search terms. Inventory-based ads create target customers who are further down the decision funnel. To fully understand the potential and power of inventory-based ads you have to understand how a customers search evolves as they get closer to making a decision. 2

3 Inventory-Based Advertising Captures Customers Ready to Buy Every customer goes through a decision funnel to figure out what exactly they need to solve a problem in their life. Inventory-based advertising targets customers who are ready to purchase. Problem Recognition: Customer knows they have a problem, but no solution. Example searches: How do I or What to do Thought Leadership Ads with lower conversion rate Information Gathering: Customer reads reviews and blogs. Search for possible solutions. Evaluate Options: Begin to look at different solutions, weighing the pros and cons. Decide: After much deliberation, the customer settles on a solution. Brand and Action- Oriented Advertising Ads with higher conversion rate Purchase: Find and purchase the solution to the problem. Inventory-Based Advertising Diagram The Decision Funnel 3

4 How Inventory-Specific Ads Saves You Money When we run an inventory-based advertising campaign, we buy keywords that a customer who s ready to buy a product types into a search engine. This would be someone in the green triangle of diagram 1.2. In this example, a customer has already done their research, they know they want a KitchenAid mixer and they ve evaluated their options to know they specifically want a KitchenAid Pro Series 600 Mixer. Keyword 5 Quart KitchenAid Stand Mixer KitchenAid Classic Mixer Artisan Stand Mixer KitchenAid Artisan Kitchen Mixer Mixers KitchenAid Professional Series Suggested Bid by Google $0.73/click $.83/click $.83/click $.98/click $1.04/click $1.25/click In Diagram 1.3 you ll see a number of search terms and the suggested bid using Google s AdWord s Keyword Finder tool. KitchenAid Pro Series 600 Mixer $.30/click Diagram Chart of Keywords and Suggested Bids What s great is as the keyword grows longer and becomes more specific, whether it s including a brand name or model, the suggested bid drops. When you get incredibly specific with inventory-based keywords you can see a drop of nearly 75% than its broad alternative. Being Specific Results in Better Performing (and More Affordable) Ads Google uses something called Ad Rank to determine the position of every ad. On a fundamental level, if you want a better Ad Rank your ads should meet the expectations of the user. This includes everything from the ad copy to the landing page. When all of these aspects are in sync, your ad will have a lower cost-per-click, a higher click-through-rate and a low bounce rate on your landing page. When you can align these items behind a very specific keyword you ll begin to see dividends in your advertising. 4

5 How an Inventory-Based Ad Campaign Complements Your Existing AdWords Campaign Traditional AdWords Campaigns Inventory-Based Advertising Campaign Capture customers at the top of the funnel. Great for promoting thought-leadership, building a brand. Get a customer s attention over a competitor or similar product. Promote specific products and inject your business or company in the decision making process. Display advertising can help reinforce brand and messaging. Lower cost-per-click means a budget can go further. Get fewer clicks, but a higher chance of conversion. Focused on the bottom of the funnel. Promote specific inventory items to customers searching for that product. Requires you to build specific landing pages and specific ad groups for each item in an inventory. 5

6 A Micro Case Study: Bill & Walt s Hobby Shop We worked with a hobby shop based in Pittsburgh to turn every single item in their vast inventory into thousands of Google Ads. Here s a breakdown of the ad performance, keyword performance and ads that we automatically generated based on their inventory. All ads were focused on local shoppers in Pittsburgh. 217 Clicks Numbers at a Glance Campaign ran from February 21 - March 21 $ Spend $.88/click 9,106 Ad Groups generated 13 keywords > 20% Click-Through-Rate 23 keywords > 10% Click-Through-Rate 34 keywords > 5% Click-Through-Rate 42 keywords > 2% Click-Through-Rate 62 keywords > 1% Click-Through-Rate Google Ads Generated by Radius Based on Inventory 6

7 In Summary Inventory-based advertising is a powerful tool that can target customers when they re ready to purchase an item. Compared to standard advertising, inventory-based advertising can be more cost effective and result in a better return on investment. Budgets can go further with an inventorybased advertising strategy. Any business with products should be leveraging inventorybased advertising in order to move particular products and bring in customers who are looking to buy. If you have any questions about inventory-based advertising, how it can help your business or client, please contact Dan@WebKite.com. He d be happy (and probably excited) to talk to you about this technique. 7