How to Use Paid Search

by | Sep 3, 2019 | Education

Paid Search Feature Image

While seemingly bare-bones compared to other channels, Paid Search punches above its weight in terms of its impact. 

LumenAd’s resident Paid Search mastermind, Mike Hofmaier, will take us through how important Paid Search is to the modern media mix and how to properly leverage it.

What It Is

What Paid Search is 

Paid Search advertising is advertising that appears as sponsored listings on search engine result pages (SERPs).

It’s the quintessential pay-per-click (PPC) channel and has a long history in digital advertising as a driver of both innovation and conversions.

Early Paid Search advertising was similar to how Yellow Pages sold their inventory. In the mid-90s, the prevailing method search engines used to index the web was manual — real people going through and compiling directories.

As with most manual processes, these early search engines were prone to error, leading to ads being poorly targeted or unrelated to the original search entirely.

In 2000, as search engines became more sophisticated, they introduced a form of real-time bidding using an auction-based PPC model. 

This means that advertisers only pay when a user clicks their ad. Early on, the advertiser willing to pay the most per click got the top spot.

But what if those ads were bad or irrelevant to the user? That user won’t click, the advertiser doesn’t reach the right audience and the search engine doesn’t get paid.

So, in the mid-2000s, Google introduced the Quality Score (QS), which is “an estimate of the quality of your ads, keywords, and landing pages.”

This is where nuance enters the picture. 

It’s about understanding what your audience is searching for and why. Once you understand these two important things, then you can create and place ads that make a difference.

If you want to dive deeper into the history of Paid Search, Search Engine Land has a great writeup here.

Funnel Fit

Paid Search’s funnel fit:


Mike describes Paid Search as “usually used for low-funnel strategies.”

It’s most effective for users looking to make a purchase or find a solution right then and there. In other words, it’s great for driving conversions.

When properly executed, Paid Search fulfills that age-old programmatic promise of “right person, right place, right time, right message.”

This is mostly thanks to its ability to capitalize on search intent, which is the answer to why the user is searching for a certain term. 

Understanding what the user is searching for and why will allow you to create ads that resonate, place those ads where they’ll get results, and, most importantly, ensure your ads are of value to the user. 

When applied to situations where the user is looking to buy something ASAP, this combination is super powerful.

Occasional Awareness

“But,” Mike says, “don’t restrict Paid Search to low-funnel conversion initiatives.” There are a lot of cases where it’s great for upper-funnel strategies, like when you’re focusing on brand building.

You could promote gated resources, offer solutions to problems people don’t understand, target complimentary/peripheral products, and more.

If you decide to pursue an upper-funnel strategy with Paid Search, Mike says “you need a really good idea of what the goal is.” Otherwise you won’t have an easy way of gauging success.

The advantages of using Paid Search for awareness are that it tends to be much cheaper than low-funnel strategies, you can become the first brand in peoples’ perception of the space and it can be a high quality source for remarketing.

But it requires good informational content rather than straight sales-focused messaging.


Paid Search’s strengths

Fewer Variables

Paid Search creative is just copy (besides Shopping ads, which of course have images of the product). If you need to make adjustments, you won’t have to swap out colors or imagery, just change the copy.

“It’s an easy way to A/B test language,” says Mike. Testing language frequently can help you narrow in on effective ad copy.


In the larger Search Engine Marketing (SEM) umbrella, Paid Search provides the most control. Search Engine Optimization (SEO) is much more nuanced and less direct. With Paid Search, you get more granular control over (and insights on) what’s working and what’s not. 

You can try out keywords, test copy, and turn “on and off” the volume as needed to see what resonating and iterate quickly. 

Bidding On Branded Keywords

If you want to enter the fray and take a stand in your industry, you can bid on your competitors’ branded keywords. Mike has a fantastic write-up all about this strategy and what to take into account when you decide to pursue it. 

Just Do It™: Target Your Competitors’ Trademarks in Google Ads →
Watch Out For

Things to watch out for

Search Intent

Mike describes the search intent as one of the biggest sources of issues for Paid Search campaigns.

He says, “You might be looking at the keyword and it makes sense, but you’re missing the whole picture if you don’t look into the search query report.” 

Your ad copy needs to align with the search query. You need to pay close attention to and have a deep understanding of what your audience is actually searching for, then meet the needs of that person with your ad.

Spend time reviewing your Search Query Reports so you can properly leverage search intent and to ensure your ads are relevant. 

Keyword Drift 

“Another thing to watch for is keywords escaping the intended ad group.” says Mike.

What sometimes happens is you’ll target a keyword in a given ad group, and if it performs poorly, you lower bids to reflect that.

If you’re not excluding it from other ad groups, Google will stop serving it in that ad group and it could move to another one.

A solution for this is to group keywords according to strategies and keep those strategies siloed.

For example, delineate branded and non-branded ad groups. If your branded bids are low, sometimes the keywords will escape that ad group into a hybrid branded-and-non-branded ad group.

Other Channels

How Paid Search works with other channels


Perhaps the most obvious relationship is with SEO, which can be a black box. Sharing what works in Paid Search can inform content strategy, what keywords to prioritize and what SEO changes to make.

Testing Messaging

As mentioned above, Paid Search deals with fewer variables than other channels. Using it to A/B test copy and overall messaging can be very effective.

Mike says, “Paid Search can be a great channel to guide language of all other channels.” 

Particularly, calls to action (CTAs) can benefit from this sort of optimization. The changes are easy to make and the insight derived from them can be far-reaching.

Conversion Engine

If Display is the channel serving the alley-oops, Paid Search is often the channel slamming it home.

Maybe the user has seen six of your Display and Paid Social ads in the last four months and they decide to finally research your product and your competitors. One final Paid Search ad may be all that’s needed to seal the deal.


Measuring success with Paid Search

Depending on your strategy, how you measure success with Paid Search will vary. Let’s get into some of the options.

Click-Through Rate

“CTR is a good early indicator on how effective your ad copy and messaging is.” Mike says. In general, a high CTR means pretty strong ad copy, though this is by no means a hard and fast rule. 

Impression Share

Impression Share is “the number of impressions you’ve received divided by the estimated number of impressions you were eligible to receive.”

If there is Impression Share loss to budget, that’s a red flag. This is a good opportunity to rethink your bid strategy and scope of keywords to prioritize low-hanging fruit.

Quality Score

“QS is a catch-22. Google can be inconsistent when scoring keywords, but you need to keep an eye on it.” says Mike.

If you have a high QS, you should be happy (8, 9 and 10 means you’re doing well). If you have a low QS, you should think through how you can improve. Mike says, “I take their scoring with a big grain of salt.”

But Overall…

You need a clear goal no matter what. If you want a low cost per acquisition (CPA), you need to answer the question of “what are your willing to spend for one more conversion?” 

And this spend isn’t just Paid Search, it includes all other channels as well.

As Shane, our VP of Client Services recently said, “When you plan media in different silos, you execute in those silos, you optimize in those silos and you report back in those silos.”

Paid Search should never be siloed. It lives within a larger ecosystem of SEO, Paid Social, Display, etc.

It’s just one part of the modern media mix, which makes it difficult to measure performance on it alone without taking into account all the other channels.

To get a holistic view of every channel, how they work together and how to improve performance, you need a platform like LumenAd. One that’s designed from the ground up to help media, ad ops, data and analytics team to better leverage each channel. 

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