As Marketers, we often get busy with the mechanics of marketing and forget some of the fundamentals of keyword bidding.  Here’s a quick checklist to make sure your bids are optimized.

•    Search Engine Suggestions

Search engines offer suggestions on where to set your bids, based on the landscape
and historical search traffic.  They will tell you to set your bid at “X” to get “Y” results.  Going with those suggestions is a good starting place.

•    Relative Position Targeting

Consider what position you’re trying to snag.  Do you prefer that your customers see you right before or right after your competition?   Start with the search engine suggested bids, then spot check and experiment with your own bids.  Search engine marketing is fairly responsive, so you can discover within five or 10 minutes just how your bid is working.  Though it’s an imperfect science, seeing your ad in context is tremendously valuable.

•    Bid Hierarchy

At what level are your bid settings operating?  Search Engine- Account- Campaign- AdGroup/Category- Keyword- Creative?  You can standardize your bid across any of these levels.  To optimize, consider benefit going one level deeper.  If you need to save time, make broader bid strokes by focusing higher up the hierarchy.  REMEMBER: granular bids trump default bids, so if you’re optimizing manually (vs. with SearchCenter), increasing a campaign’s default setting will only impact keywords that don’t have their own bid.

•    Revision Triggers

Often, as search engine marketers, we get our bids working at a single moment in time, and then sort of neglect them.  Even if high-level metrics look stable, keep an eye out for the following events that can dramatically impact your bidding environment:

Competition: New competitors and changes in existing competitors’ SEM strategies make for a very dynamic marketplace.  If a competitor boosts their SEM bids, for example, it can have a significant impact on your own placement.  If for some reason they scale back on SEM, you may find that you no longer have to bid as high to achieve the same placement.

Distribution: Changes in distribution networks can also affect your SEM campaign.  If Google signs a significant new publisher for an Adsense campaign, you might see a sudden lift in traffic.  You’ll want to look at those visitors, see whether they’re working for or against you, and adjust your bid accordingly.

News: Say, for example, Omniture was bidding on a broad match of the term “analysis” and producing an appropriate Return on Advertising Spend (ROAS).  Then, a national economic stimulus report gets published, and tons of people are searching for “economic analysis.”  This surge of search inventory may be largely irrelevant, resulting in a lower click through rate (CTR) and a higher bid to maintain position.  Conversely, another news item on a new product release may be highly relevant, driving up clicks, CTR, and requiring a lower bid.

Campaign Optimization: As you optimize Search campaigns, you might see performance change based on those adjustments.  For example, say you create some more appealing ad copy that drives up CTR.  Or, you could decide to better qualify traffic by making ad copy more specific, driving down CTR.   Successful conversion optimization on your landing pages may improve your ROAS enough to enable you to target a higher position on the search engine results page.

There is a good range of technology available to help you make this happen.  Omniture Search Center, for example, is especially helpful when it comes to automated bidding using the important metrics that your web analytics is measuring deeper within your customer’s experience.  It allows you to set rules beforehand, so that you can select criteria that allow your bid to change automatically, as it needs to, for example: when your ROI is greater than X, it will increase your bids by Y.  Check out the resources on the SearchCenter product page for more SEM specifics.

No matter what your current approach is, don’t overlook the competitive importance of a proactive system for managing keyword bids.