There’s much to be learned from the suc­cess­es of the “big guys” in PPC – those brands that spend hun­dreds of thou­sands or even mil­lions in paid search ads – but even more from their mis­takes.

Man, has eBay made their share of mis­takes… and then some.

You see, eBay was­n’t very hap­py with their Google AdWords per­for­mance, so they wrote a report on how ter­ri­ble PPC ads are and decid­ed to boy­cott the chan­nel. AdWords is a com­plete waste of mon­ey, they said.

Yet even a cur­so­ry look at their AdWords ads and strat­e­gy point­ed to sev­er­al mis­takes that could eas­i­ly have been cor­rect­ed.

If you don’t want to end up with a PPC strat­e­gy like eBay’s (see: none at all), learn from these six crit­i­cal mis­takes.

1. Relying On A Single Source Of Traffic Is Dangerous

EBay did­n’t need paid search, they said, because their organ­ic rank­ings were strong. Unfor­tu­nate­ly, some SEO issues on their site result­ed in a huge organ­ic traf­fic loss as a result of Google’s Pan­da 4.0 algo­rithm update.

Putting all your eggs in one bas­ket is dan­ger­ous in any busi­ness, but espe­cial­ly in ecom­merce. You need diverse traf­fic sources to with­stand fluc­tu­a­tion in any one chan­nel.

Les­son: Organ­ic and PPC aren’t com­pet­i­tive, but work best togeth­er.

2. Dynamic Keyword Insertion Isn’t An Autopilot Feature For PPC

EBay’s ads were a source of online hilar­i­ty for many years, thanks to their DKI inser­tion night­mares. Dynam­ic Key­word Inser­tion (DKI) is a fea­ture that injects spe­cif­ic key­words into ads to match user search­es. It’s a pret­ty use­ful fea­ture when used prop­er­ly, but it isn’t meant to be autopi­lot for your AdWords account.

EBay’s mis­use of DKI result­ed in ter­ri­bly mis­matched ads, where the insert­ed key­word made no sense in the con­text of the ad as a whole, like this:

Some weren’t just sil­ly, but offen­sive, like DKI ads for slaves and wives.

Les­son: Use Dynam­ic Key­word Inser­tion only where it makes sense… and mon­i­tor it!

3. Broad, Irrelevant Ads Kill Your ROI

Of course eBay was­n’t hap­py with their AdWords per­for­mance and return; they were blan­ket­ing the web with crap ads that often had noth­ing to do with the user’s query.

A query for the word “love,” for exam­ple, trig­gered an ad from eBay:

Peo­ple look­ing for love obvi­ous­ly don’t want to buy it on eBay! You don’t want peo­ple click­ing on ads like this.

Irrel­e­vant ads have a far greater cost than unwant­ed clicks. Peo­ple tend not to click on ads that don’t answer their ques­tion.

The way AdWords works is that adver­tis­ers with the best ads – those with high rel­e­vance and good click-through rates – get a click dis­count. Mean­while, low rel­e­vance, low per­form­ing ads pay more per click.

That’s right, bad ads cost more.

Les­son: Boost your ROI by improv­ing rel­e­vance and opti­miz­ing ads for rel­e­vant clicks.

4. Don’t Try One Approach And Throw Your Hands In The Air

eBay’s “research” on AdWords was real­ly just anec­do­tal since they weren’t even employ­ing best prac­tices. Yes, they had a large sam­ple size of AdWords activ­i­ty to ana­lyze, but it was pret­ty sil­ly to pub­lish a report slam­ming AdWords when they had­n’t even put the bare min­i­mum of effort into their account.

It should have been an inter­nal doc­u­ment meant to help them improve their own strat­e­gy, rather than a report damn­ing the plat­form. Instead of try­ing to learn and adjust, eBay decid­ed AdWords just sucked. They took their toys and went home.

Les­son: PPC is all about test­ing, opti­miz­ing, and test­ing again. Invest the time in learn­ing what works for your brand.

5. Size Doesn’t Matter As Much As You Think

Until two years ago, eBay was the sec­ond largest ecom­merce ad spender in AdWords. Decid­ing that their accounts were too huge and com­plex to man­age prop­er­ly was a copout.

Big busi­ness­es like eBay do tend to have incred­i­bly com­plex accounts, but they also have more resources to man­age them. AdWords accounts require reg­u­lar upkeep, regard­less of size, by ded­i­cat­ed PPC man­agers.

Les­son: In our stud­ies on the top per­form­ing ads in the AdWords sys­tem, account size was­n’t a deter­min­ing fac­tor in ad per­for­mance.

6. Really Get To Know AdWords – Ignorance Is No Excuse

EBay’s report showed that they did­n’t under­stand how many AdWords fea­tures work. For exam­ple, they decid­ed that ads shown to their return­ing site vis­i­tors had a less­er return than those shown to new vis­i­tors. There­fore, they decid­ed, those ads were a waste of mon­ey.

Except, you can exclude cer­tain audi­ences in your paid search cam­paigns.

Often, the solu­tions for the issues you’re expe­ri­enc­ing in AdWords are already there – you just have to find and use them. EBay real­ly had no excuse for not learn­ing about these options at some point.

Les­son: Study and under­stand all the AdWords fea­tures avail­able to you.

PPC Strategy And The Value of Elbow Grease

It real­ly comes down to effort. Adver­tis­ers can achieve uni­corn results if they put the leg­work into it. It’s a mas­sive indus­try that’s still see­ing dou­ble-dig­it growth each year and the oppor­tu­ni­ty to con­nect with and nur­ture leads is great.

Auto­mate where you can – to save time and more eas­i­ly spot oppor­tu­ni­ties – and get your best prac­tices in check, then com­mit to ongo­ing opti­miza­tion. Any­one can do this – even eBay.