This is the third installment of the 4-part series on key PPC best practices (PPC Best Practices Part 1, Part 2). So far we’ve introduced the basics in the planning and measurement involved with the setup of a PPC campaign in addition to conversion path analysis. This week we’ll get into testing, demographic targeting, and vertical engines.

Don’t Guess… Test

With a PPC campaign, testing is the campaign manager’s best friend. Testing is a constant, iterative process that must be followed to refine the effectiveness of your Search Engine Marketing (SEM) campaigns. Multivariate testing can be as complex as developing a multitude of landing pages and testing multiple aspects (such as images, titles and page copy, to name a few) or as simple as using versions of a landing page or ads in A/B tests and constantly refining the best performing versions.

The key with a testing strategy is to balance the size of the test with the size of the account. The larger the test, the longer the testing process needed to gain statistically-relevant data. No matter what the size of the test, budgeting the necessary time is as important as budgeting the media spend.

Don’t Get Punished for Bad Behavior

Behavioral targeting has become one of the more popular buzzwords in the industry and rightly so; after all, the better we can target our market the more effective our campaigns. Several options are available to better target our online market, including geo-targeting, day-parting and demographic targeting.

For example, geo-targeting can be used to communicate more efficiently with users in a particular region and better allocate your product offering. After all, selling snow shovels in Florida wouldn’t be particularly advantageous, whereas selling air conditioners would be.

Finally, it is possible to target based on demographics. This targeting is most effective when using a content network and using site targeting based on the demographics of the audience for a particular site. However, although the information is available through such tools as MSN’s Ad Intelligence, I would stay away from disqualifying keywords because they are not in line with your target market’s demographics.

For example, according to the US Census data, most HR managers tend to be female, yet in targeting this audience I would not disqualify the keyword "Human Resources Management" because the demographics are skewed towards men. One of the marketing basics that’s literally been engrained into all marketers is to advertise where your market is and one very effective behavioral targeting mechanism is the use of vertical engines in your paid search strategy.

Get Vertical

Vertical search engines are an effective method of lowering CPC and improving the overall quality of traffic. The quality of the searches with a vertical search engine also tends to be better due to the increased propensity for buyers to use vertical search engines later in the purchase decision process. This presents an opportunity for those with more limited budgets (and those with the budget, too) to more effectively spend online and generate higher ROI.

Vertical engines also offer the ability to access a much more targeted audience which will allow you to develop custom ad copy for the particular demographic. Although the traffic on vertical engines is no where near what it is on Google, Yahoo, or MSN, it is important not to discount these engines from any paid search strategy.  The ROAS that can be gained from advertising on vertical engines can far exceed what any mainstream engine can provide. The detriment to working on vertical engines are the differing revenue models ranging from CPC to fixed cost and the management nuances to be learned for each engine.

Of course there is a lot more to these best practices than the little snippets above, but those will be the subjects of future, more in-depth articles to come. For the continuation of this series, please visit PPC Best Practices Part 4.