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Google AdWords Shake-Up Part 2: All Calm, but Watch Out for Displaced Competitors

It’s been just over one week since Google universally rolled out their update to the desktop search results page. It is one of the biggest changes to Google’s SERP in a decade. Unless you’ve been living under a rock, you’ve probably read a lot about this change. If you’re seeing this for the first time, you can catch a quick overview by reading more here.

What Does “What this Means” Mean?

So, why is it so challenging to “tell you what this means” when trying to estimate how much it will impact your dealership?

Here’s why:

As of now, this change is having a relatively small impact on advertisers. Some of the clicks that are being lost from the sidebar ads are being recaptured from the addition of a fourth ad above the organic results. In the end, advertisers who were already in the top 3-4 spots probably haven’t seen much change.

The early data coming in from advertisers and Google alike is telling a similar story. The trends comparing pre-change and post-change performance data are relatively stable.

That’s where things start to get messy. At the end of the day, the real story here isn’t how the desktop SERP has changed. It’s more about how the market could react to those changes on a long-term basis.

In the short term, today’s data says “stays cool, no big deal.” But, is that because the storm fizzled out, or are we merely enjoying the calm of being in the eye of a hurricane?

We have to remember that these changes have been live in the wild for just over a week. That’s simply not much time to observe a major shift in action.

Watch Out for The Displaced

Most people reading this will know that ad position (i.e., the slot on the SERP your ad is assigned to) is determined by a number of factors. For a great intro on this works, you can learn a lot from this 8-minute video on Insights on the AdWords Auction.

The Displaced advertisers will have two basic courses of action: They can either accept their fate and take what’s given to them in the new auction landscape, or they can work to earn a higher position.

Taking Action

I think we can safely assume that most advertisers are not going to simply “do nothing”. So, the question now becomes “what can they do, what should they do, and what will they do?”

If you’re an advertiser who lives low on the ad position totem pole and you want to move up, you’ll rely on two basic strategies:

  1. Use a more aggressive bid strategy to improve your Ad Rank.
  2. Become more relevant and improve your Quality Score to improve your Ad Rank.

Both tools are effective and the savvy advertiser will use a combination of the two. Strategy #1 only makes sense if you have the budget and the ROI to support it, but since it is a lever that an advertiser can pull today and see results tomorrow, you can be confident that many of The Displaced will pull this lever first. Strategy #2 is a long-term play. Proper ad testing and research is an ongoing, iterative process that produces results on an unpredictable time frame.

So what does this truly mean to you, the automotive AdWords advertiser? The most correct answer is that no one can say with certainty what exactly will happen. In summary, there are a handful of things you need to be doing now to ensure you’re staying ahead of the game:

AdWords part 2 of 3 (1)

  1. Watch the Right Stats
    Benchmark and then monitor your important metrics like CPCs, CTR, and Average Position. Make sure you understand these in relation to your market, your history, and to D-Day (February 22, 2016, the day your universe of keywords began serving exclusively in the new SERP format for desktop and tablet searches). Pay attention to your Top vs Other Report in Google AdWords; it will come in handy.
  2. Ignore the Wrong Stats
    There’s been so much focus on the impact of this change that it’s easy to get caught up in the frenzy. Step back and keep your eye on the ball. Remember that this change does not impact mobile. In most industries, mobile search drives more than half of all traffic. With our clients in automotive, that number skews even higher (60-70% of all traffic is mobile).Without a doubt, mobile is and will remain the primary battleground. Because this change may cause advertisers to modify their desktop strategies, it stands to reason that some advertisers will inadvertently change their mobile strategy for no reason other than ignorance and inattention. Be aware of the riptide of accidental neglect.
  3. Invest in Long-Term Relevancy
    We’ve already touched on ad testing and the positive impact it can have on Ad Rank. Don’t ignore this. Methodical testing over time will improve your results. SEM is about testing. Stay true to those roots and test like a maniac.
  4. New Features = New Opportunities
    This change is not all doom and gloom. It also creates some interesting opportunities. An additional ad above the organic listings a big deal. Google hasn’t exactly clarified what a “high commercial intent query” is, but the early data suggests that most automotive searches will result in 4 ads at the top of the SERP. Getting yourself into the top-performing locations may have gotten a little easier.This change also makes all ads eligible to serve all type of ad extensions (see an overview of ad extensions here). Extensions are a proven way to drive campaign ROIPreviously, this privilege was reserved for the top 3 ad positions only, but now it’s open to all ads. Take advantage of that and embrace the opportunity.

 

Stay Tuned for More Next Week. Next week, we’ll be putting the capstone on this blog series with some interesting 1st-party data that we’ve been collecting since February 22. It will include a data-driven synopsis of the impact we’re seeing on our clients’ ad position, costs, and lead counts following this change.

Neal Gann, CEO
Neal Gann brings over 20 years of experience in the automotive industry, and his expertise in marketing, product development, sales and operations have made him one of the best in the vertical. A strategic thinker with a sharp eye for new ideas, Neal is dedicated to growing Showroom Logic through his collaborative leadership style and relentless drive for success. And with his strong roots in creating and optimizing online marketing programs for some of the most successful dealerships in the auto industry, Neal is able to challenge the status quo and lead the way towards innovation.