Think you’re ready to growth hack? AdWords says not yet

This is Week 2 in the 10 Growth Experiments in 10 Weeks series. We’re running 10 experiments to see which  growth strategies are the most promising for Kiip’s business model and current state. Follow us on Twitter to get more marketing updates.

Planet AdWords: Make sure all growth systems are go for launch

AdWords is our starting point. With relevant and reasonably priced traffic, AdWords is just as valuable as a knowledge tool as it is an acquisition tool. This is my favorite lesson from Jason Freedman, co-founder of 42Floors. Jason uses AdWords to assess the viability of new business ideas before committing additional resources. Thinking of launching a car insurance startup? Get up a landing page explaining the product and drive relevant AdWords traffic. If you are struggling to convert highly-targeted traffic, you might be building a business without a market. It will take a week and maybe $1000 to determine this. You just saved yourself 6 months of development time and tens of thousands of dollars. This probing approach is the one we took with AdWords, but with a slight twist.

Our business model is already validated — we have 1,500 apps and 300 advertisers on the Kiip network. Rather than testing the viability of a business, we used AdWords to test how well we explain the business on our landing page and convert top-funnel traffic. If we convert >5% of AdWords traffic, then we educate well. If we convert less than 5% of AdWords clicks, then we have some explaining to do.

Four Steps to Creating Insightful AdWords Campaigns

  1. Set up tracking and analytics to attribute new signups or purchases to AdWords
  2. Determine your target audience and how you want to message them
  3. Optimize the campaign as it runs
  4. Learn from results

1. Set up tracking and analytics to attribute new signups or purchases to AdWords
Before setting up AdWords campaigns, we linked our Google Analytics to get full attribution. This allows us to track the user behavior for every ad group clicked.

2. Determine your target audience and how you want to message them
We want to reach marketing and customer acquisition managers interested in mobile options for customer acquisition. Three campaigns were set up: (1) Kiip-related keywords (2) mobile user acquisition and (3) generic user acquisition. This allows us to (1) Completely own any “kiip” queries/searches on Google, take control of our brand equity, and present Kiip advertising in the top ad position (2) Target queries revolving around mobile advertising (e.g. in-app advertising, mobile app marketing, etc.) (3) Target user queries looking for ways to acquire more customers in general. (e.g. customer acquisition, how do I get more customers)

Kiip AdWords Ads

3. Optimize the campaign as it runs
A major advantage of the AdWords platform is it’s real-time dashboards, which display performance across campaign, ad group, and keyword dimensions. This allows you to focus dollars on successful dimensions and divert dollars from poor performers. For Kiip, we created a negative keyword list to ensure our ads only appeared in front of our target audience, advertisers. We blacklisted the below terms, which did not specifically relate to advertisers.

Blacklist Keywords

4. Learn from results

AdWords as a knowledge tool teaches you what your current website is built for. If you have a high signup rate, your site is ready for paid traffic. If your signup rate remains low, you need to iterate on landing pages until you can convert paid traffic at a reasonable rate.

We aren’t ready to growth hack
AdWords consumed 20 employee hours and $850 to drive 1 signup. The results are less than stellar at 0.5% landing page conversion rate, $8.80 average CPC and $850 per signup. With only 1 signup, the results aren’t even statistically significant. But our keywords are so expensive and results so poor that it’s not worth it to spend the money to ensure a statistically significant sample. Below are the CPCs for each keyword grouping we targeted:

Generic User Acquisition: $18.09
Mobile User Acquisition: $9.21
Brand: $0.97

This does not mean that AdWords as an acquisition source is a bad option. Rather, our website does not explain Kiip’s business well enough to convert top-funnel traffic.

Kiip AdWords Performance

Before we continue with more growth hacking experiments, we need a landing page that can convert 5% of qualified traffic. Otherwise we’ll be wasting the opportunity to turn the interested traffic from our growth hacks into successful customers. Time to iterate on landing pages.

Where to learn more on the topic
http://searchengineland.com/ – Resource to learn about new adwords products & features
http://adwords.blogspot.com/ – Google’s official blog to stay up-to-date on changes in the AdWords ecosystem.

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  • YM Ousley

    You might not be ready to growth hack, but it would be interesting to see this retried on different platforms. For example, if this were a test on Facebook targeted by interests or employer rather than search, it would be interesting to see if you got the same results. Let’s say you were focused on acquiring more developers, or even specifically game developers. That’s probably an interested audience that may not be actively searching on the terms you’re advertising on, but an audience you can target in other ways. On the landing page, you can go for a simple ask, perhaps a 3 question survey asking what options they currently use to monetize their apps. That will give you a starting point for keywords and terms that might have lower competition that wouldn’t necessarily appear in the keyword tool (and the options they view as competitors, which may have also not been a consideration point).

    • KFishner

      I like your thought process on using Facebook to learn different user behavior on your landing pages. Have you noticed different behavior between Facebook and AdWords traffic? I’m sure there’s a major difference.

  • Is this adwords => full on sign up?
    You gotta do lead nurture for relatively unknown brand…

    http://www.freshsupercool.com/5-reasons-why-your-new-search-ppc-campaigns-will-bomb/
    (point #5)

  • shanesqdm

    Love this content series. Keep up the good work! Just tweeted.

    This article really illustrates a practical and sensible way to decide when you’re ready to take a project to scale. So many people skip this step and disaster ensues.