Google’s Dynamic Ads

Google recently rolled out dynamic AdWords ads – a feature that will allow advertisers to create dynamic ads based on Google’s organic web crawling technology.

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Just over a week ago Google announced that it’s beta testing a very interesting concept – dynamic AdWords ads – a new feature that will allow online business owners to create dynamic ads based on their inventory by using Google’s organic web crawling technology.

There are a lot of e-commerce and transactional websites online that are constantly adding new products to their stock lists and a well managed PPC campaign would reflect this by adding each product, where appropriate, to the campaigns.

However Google’s new feature proposes to do this for you by dynamically generating an ad that correlates to the products on your website. Therefore Google will pick the headline of the ad based on the search query and ad text based upon the most relevant landing page.

When an ad is dynamically created it then enters the usual ad auction, unless you already have an ad set up for the phrase that has been searched for.

If the concept truly does work and perfectly marries relevant searches to products then this could be a very exciting addition to paid search and according to Google’s pilot test, it has worked to increase clicks and conversions by 5-10% for the majority of the advertisers.

In order to control which products and web pages have dynamic ads, advertisers can specify whether they want it to be their whole website or they can narrow it down to chosen categories / pages containing particular words / pages containing chosen strings in their URLs.

You can also choose to add these controls as negatives as well as the usual keyword negatives to try and control which products Google creates the ads for and to prevent them doing so for out of stock or redundant products.

In terms of reporting it is very much the same as the usual AdWords reporting but Google will show you the searches that generated clicks, the destination pages suggested as landing pages, the headline of the ad created as well as average CPC, CTR and conversions etc.

It is obviously hard to comment on exactly how well it works without testing it myself but I would be slightly nervous about allowing Google to dynamically create ads and would worry that the costs could get out of control if not managed correctly.

Google is probably hoping that advertisers will put their faith in the system and allow it to create ads for all products on their site’s and obviously if it works correctly and the advertisers products are shown to people that are searching for them then that’s great but how will Google control CPC for different priced products?

This feature is most likely to appeal to those businesses that do not know much about AdWords and paid search as they will able to set up an account and essentially let Google do the work for them, but this could be very dangerous as Google is obviously the one cashing in when users click on the ads.

We all know that Google wants its search results to be as relevant as possible so there is no denying that it will do its best to create relevant ads but relying on automated software has its risks and nothing can beat an human perspective.

A real person is always going to be better at making decisions about which products to advertise, keywords to bid on, maximum CPC bids to set and analysis of the results as they can consider ROI, whereas Google will not be taking that into consideration.

3 thoughts on “Google’s Dynamic Ads

  1. I’d like to see some more explanation of how this is going to actually work and also when it will become available. People who don’t know much about AdWords would be better off letting a pro handle thing for them, in my opinion.

  2. In our pre-beta testing, we feel we’ve confirmed the usefulness of the feature for advertisers with larger, rapidly changing web sites so that’s who we’ve recommended it to in this open beta period. We recognize that the feature may have some appeal to smaller, less sophisticated advertisers who do not want to manage keywords. But for that segment, we’d much rather see them utilize AdWords Express than Dynamic Search Ads.

    Also, I’d like to point out that in our welcome email to all beta participants, we give the following detailed advice to help guide advertisers appropriately manage and optimize DSA to profitably grow their results.

    – To more easily manage your spending on Dynamic Search Ads and understand performance relative to your traditional campaigns, set up Dynamic Search Ads in its own campaign.
    – Target your entire website to get the most potential results from Dynamic Search Ads.
    – Set an initial budget of 10% of your current keyword campaign budget.
    – Set your max CPC bid to 75% of your current keyword campaign average.

    To the author’s question, “Google is probably hoping that advertisers will put their faith in the system and allow it to create ads for all products on their site’s and obviously if it works correctly and the advertisers products are shown to people that are searching for them then that’s great… This feature is most likely to appeal to those businesses that do not know much about AdWords and paid search as they will able to set up an account and essentially let Google do the work for them, but this could be very dangerous as Google is obviously the one cashing in when users click on the ads.”

    At this point in Dynamic Search Ad’s product’s development, we don’t believe what you just described is a realistic high-performance strategy for most, if not all, advertisers. There’s already a solution for advertisers that prefer a simpler, more transactional relationship with AdWords — it’s AdWords Express.

    Also, Google doesn’t want advertisers to pay for clicks and not get results. We don’t benefit from dissatisfied advertisers. Also, if advertisers aren’t getting results from their ads, it might mean that their ads aren’t useful or relevant to the user, and that’s not something we want, either.

    “…but how will Google control CPC for different priced products?”

    As we mention in our welcome email for beta users: After running your Dynamic Search Ads campaign, you can optimize it using an approach similar to what you’d do with keyword-based campaigns.
    1. Run a category report from the Auto-targets tab to see how different categories of your web site are performing using the “see categories” button. You can specifically add certain categories with higher or lower bids depending upon your observed and target volume, profit, and cost objectives.
    2. See what searches are being targeted with Dynamic Search Ads from the Auto-targets tab or using the See search terms button. Then add negative keywords or create negative auto-targets to filter out undesired searches. You can also add high performing keywords that Dynamic Search Ads has discovered to your main keyword-targeted campaign to manage in the usual manner (be aware: if you add keywords into a DSA campaign, you’ll also need to create a full text ad and specify the landing page just like with in any other campaign; also, keyword-targeted ads do not automatically pause or unpause depending on the availability of the item on the landing page).
    3. Adjust your budget and max CPC bids up or down to adjust volume and cost.

    “…A real person is always going to be better at making decisions about which products to advertise, keywords to bid on, maximum CPC bids to set and analysis of the results as they can consider ROI, whereas Google will not be taking that into consideration.”

    I think you man “a skilled real person.” Dynamic Search Ads perform best when optimized, just as with other campaigns. We believe that experienced, well-trained operators can make a huge difference in the results of an AdWords campaign, whether they’re using Dynamic Search Ads or not. It’s worth noting that there are physical limitations to how much a single skilled operator can handle at a time — or even a team of skilled operators. We believe Dynamic Search Ads can play a valuable supporting role in an overall strategy for maximizing reach and results even when a campaign’s foundation is based on keywords, well crafted ads, and constant refinement to bids, budgets, extensions, and targeting. I hope that you register for the beta if you haven’t already so you can test the feature out and determine the best usage strategy within the accounts that you manage.

    Regardless of whether you choose to use Dynamic Search Ads or not (I hope you’ll test it, though!), we wish you continued success with AdWords.

    Mark Martel
    AdWords Product Marketing

    1. Hi Mark,

      Thank you for your comments and contribution to the topic.

      You are absolutely correct that “a skilled real person” is needed to deliver strong performance and there is no doubt that there are a lot of examples where automated optimisation will out perform a bad (lazy?) human operator.

      We do still feel nervous about giving away too much control but acknowledge that the option is a nice one to have and will be keen to test it and measure the performance.

      Adwords Express is another step in the ‘lack of control’ direction and one that is definitely less appealing, in our humble opinion, to agencies. We were at the Engage event last Friday, where Adwords Express was being pushed and agencies encouraged to sign up clients. There are clear advantages of this option for those advertisers who don’t have the time / energy / knowledge / enthusiasm to set up an adwords campaign, but it is not immediately clear why agencies would want to promote the service as it effectively does them out of a job (unless you assume that a massive percentage of Express campaigns are ‘upgraded’ to a full Adwords account which would benefit from agency support?).

      Always keen to see evolution and Google has a great track record in innovation and the humility to admit defeat on occasions (think Google Wave, Google Buzz and we will be interested to see how Google+ performs in the longer term, but that is another topic entirely…), so good for you for launching new products and thanks again for adding the official Google perspective to the new dynamic ads feature.

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