Increase Search Ad Returns With Multivariate Testing and Optimization

By Robert Bergquist

Smart advertisers don't guess--they test. David Ogilvy, the "Father of Advertising" and founder of the esteemed Ogilvy & Mather, famously said, "If it doesn't sell, it isn't creative." He preached the power of campaign testing and optimization well before the rise of the Internet and web analytics. "The most important word in the vocabulary of advertising is test," he liked to say.

Mr. Ogilvy's message should resonate even more today for two key reasons. First, testing is easier now with the shift to online forms of media from traditional, harder-to-measure types, along with significant advances in testing and optimization technology. Secondly, as our economy slows and all budgets come under increasing scrutiny--especially marketing budgets--we need to become hyper-diligent regarding accountability and return on ad spend.

Listen to Your Customers
Online advertisers no longer have to guess what combination of creative and copy elements will sell best. It is now possible to test and know what works best. Every second of every day, your online customers are telling you what they like and don't like. All you have to do is listen and act. The advances in testing technology and methodologies permit continuous testing for ongoing campaign performance refinement.

The discipline of "test and know" is especially critical for paid search, since it's possible to track the entire sales funnel, from key word to conversion event. If you want to protect and grow your online ad budget, you would be well-served to test and optimize the entire process, from keyword buy to text ad wording, through to the landing page where you can leverage simple A/B testing and more advanced multivariate testing techniques to optimize your return on ad spend.

Test Where It Delivers
Most marketers have become adept at advanced search engine marketing tactics, such as optimizing keyword buys and text ads, along with other "top-of-funnel" disciplines focused on maximizing and refining traffic. However, many pay only passing attention to the actual web pages upon which search traffic lands on its way to a conversion event. A recent survey of 540 search marketers by Search Marketing Now and Widemile revealed that only 40 percent were doing any landing page testing--and most of it was simplistic A/B testing.

While top-of-funnel tactics are an important first step, they are only part of the answer. Beyond SEM lies the real payoff: the conversion event. By turning your attention to this critical step in enhancing the user experience, you can optimize your whole sales funnel, from keyword buy to your ultimate conversion goal, for much improved returns on your search budget.

It's Easier With Multivariate Testing
You can follow basic best practices for good landing page design and use your analytics system to conduct simple A/B split tests to evaluate one page over another. This can improve returns, but A/B testing can be laborious and doesn't easily reveal exactly what it is about one page that makes it outperform another.

Optimizing ad campaigns and the linked landing pages for peak performance is now much easier and efficient with the advances in multivariate testing, which provides a scientific approach to testing hundreds or thousands of possible page variations very quickly to determine what optimal combination of elements is most likely to generate customer conversions.

Multivariate testing enables you to modify key areas of a web page--experimenting with multiple versions of an offer, image, copy and the call-to-action button, for example--to determine the best-performing combination under actual user conditions. You can even test different landing page combinations in conjunction with specific traffic sources, such as search engines, key words, and text ads. Testing also increases the relevance of landing pages, which can have a positive impact on your Google quality score and search engine results page ranking.

A Case Study
SmartSheet.com, a Bellevue, Wash.-based company, provides a great example of what can be achieved by leveraging live search traffic to optimize ad campaign performance. The results? Better conversion rates, greater search campaign efficiency and significantly more new customers from the same paid search spend.

SmartSheet provides online task management and collaboration software. The company uses pay-per-click search advertising extensively, employing numerous keyword and text ad campaigns through the major search engines, principally Google. Specific landing page templates are linked to certain keywords and customer needs, e.g., project management or HR performance reviews.

While SmartSheet's search marketing activities are well run and conversions were already relatively high by industry standards, the marketing team suspected performance could improve further. After a single test cycle of less than a month using multivariate testing, SmartSheet more than doubled its return on ad spend--meaning that for the same PPC search spend it received twice the number of new customers. After just a few weeks of the improved conversion performance, SmartSheet was able to increase its keyword budget since the PPC campaign was generating such significantly improved returns.

The three-week optimization project determined the optimal combination of page factors for SmartSheet's best-performing landing pages and provided valuable lessons to guide further tests and other marketing initiatives within the company. As is often the case, some of the lessons learned were surprising. For instance, a very unlikely sign-up button version ended up having the most dramatic impact on overall campaign performance.

The team tested three fairly standard button phrases for its collaboration product: "Sign Up Now," "Start Now" and "Organize Me." At the last minute, a member of the team suggested "Start Sharing." No one really expected it to perform well, but since it was easy to test, it was included. In a traditional creative presentation scenario, the "Start Sharing" text would not have survived the first critique. However, when testing, you can avoid guessing and try all ideas, even less conventional ones.

Within six days, it was obvious that the "Start Sharing" button text was the clear favorite, delivering significantly more conversions and exerting a greater influence on overall page performance than any other factor. In fact, with that text, the button had double the influence on conversions as the product description and six times the influence of the copy describing the sign-up process.

Higher Ad Returns
Multivariate testing and landing page optimization are still relatively new disciplines, but they're rapidly becoming an essential part of many top performing search campaigns. Like SmartSheet, which realized a 100-percent increase in new customers generated by its PPC campaign, marketers who leverage multivariate testing generate higher returns and can therefore justify larger keyword budgets.

Heed Ogilvy's advice: "Never stop testing and your advertising will never stop improving."

Robert Bergquist is CEO of Widemile, a web testing and optimization firm based in Seattle. He can be reached at robertb@widemile.com.