Some months ago, Google released a new advertising product, responsive search ads. Released in a beta test to a select number of accounts, this was a follow-up to the release of responsive display ads, which had been met with wide acclaim from marketing professionals. Responsive ad products, as Google tells it, are the way of the future, utilizing machine learning to map behavior patterns of consumers, and then displaying the correct ad formulation in front of them, based on millions of data points.
Just recently, Google announced the full release of responsive search ads to all accounts. POSH Detroit had been among the accounts granted access to the beta test, and the results have been nothing short of incredible.
So what are responsive search ads, exactly, and how do they work? Furthermore, how much better are they than the traditional search ad?
When you are creating a traditional search ad (or Adwords, as some still call it), you have a simple formula. 3 headlines, 2 descriptions. Yes, you can incorporate sitelinks, structured snippets, and other ad extensions, however, we will be comparing the most basic of ads for simplicity.
The headlines are a maximum of 30 characters, the descriptions 90. So you had a total of 270 characters to get your point across to the consumer. Not a lot of room, and many advertisers, after the rise of Facebook and Instagram, were abandoning the platform in droves, citing cost and lack of options as their main rationale.
Enter responsive search ads. The format is immediately different. Rather than the traditional 3 static headlines and 2 static description lines, you can create up to fifteen different 30 character headlines, and four 90 character descriptions. This gives you much more creative license in your advertising.
The real magic happens after you launch a campaign. Google’s machine learning starts to compile data based on searches, consumer profiles, and other data pools, to map the behavior and preferences of those searching for your product. It then uses the mix of creative elements you have provided to display the most successful ad combination to the consumer, based on these data points.
For example, let’s say you run an e-commerce business selling hand-knit, decorative socks. Depending on the search query, your ad combination would display differently to searchers looking for “socks” and those looking for “designer socks”.
Furthermore, it would display differently to someone searching for “socks” in New York than it would to someone searching for “socks” in Texas. Even more impressive, it could, and very well may, display differently to a man looking for “socks” in New York, and a woman looking for “socks” in New York.
If you are to utilize all options, there are over 40,000 possible ad combinations that can be displayed, giving you a ton of flexibility in your advertising, while delivering the most optimized message to the right person, at the right time.
So, most people will say “that’s great, but what’s the payoff?” As mentioned, POSH was granted access to use these ads in the beta phase, and the results were pretty fantastic.
We ran them for a retail client, A/B testing against traditional search ads. The traditional search ads performed in line for the industry averages, hovering around a 7% CTR, with a CPC of about $0.86. We incorporated sitelinks and ad extensions, which are the typical enhancements to search ads. We tracked the ad spend to be around $73.77, with a total sales revenue of $8,736.33.
The responsive search ads had the following results: An average CTR of 12.92%, a $0.37 CPC, with a total ad spend of $228.22 and a total revenue of $28,987.29.
The performance has been similar across all industries. In real estate, we have seen CTR rates that are anywhere between 1.7-2.6x the normal rates, with significantly lower CPC (about $2.72) and a higher conversion (about 10% higher).
The sheer impact that these ads have had is not to be overstated. The reason so many people left the Google Ads platform in favor of social media was due to cost, and performance. Responsive search ads address both of these issues, with performance increases that outshine those typically seen on social media.
With the recent issues related to advertising on social media (ad saturation, consumers leaving platforms, diminished ROI), Google responsive search ads might be the solution your business is looking for.