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Bid Increase Creates Opportunity For Google Grants Users

By Zach Halper - May 3, 2013

The nonprofit version of Google’s popular AdWords program, which allows advertisers to promote their services through targeted ads, has increased the amount organizations can bid on keywords, allowing organizations to place more competitive bids.

Google Grants provides approved organizations with $10,000 monthly to spend on targeted ads on Google.com. Here’s how it works: Users can browse through a list of search keywords and place bids on them. Ad position is based on a number of factors, including the amount bid and relevancy of the ad to the keyword.

On Jan. 28, 2013, the search engine giant announced that Google Grants would be undergoing some changes. One of the more significant of those was the increase of cost-per-click (CPC) bids on keywords from $1 to $2. CPC means that the publisher (in this case, Google) is paid based on the amount of clicks an ad gets. The higher the CPC, the less clicks you are likely to receive. As Google explained in a blog post on its website, the change allows organizations to “enter auctions previously unavailable at the $1.00 bid cap.”

“Nonprofits didn’t really have a chance to show their ad sometimes because keywords were so competitive,” said Amanda Sides, account director at Search-Mojo.com, a search engine marketing agency in Charlottesville, Va. “The increased cap will allow organizations to be more flexible with their campaigns.”

Although the increased bidding cap does allow greater flexibility, Sides said that nonprofits still need to focus on more targeted keywords to get the most bang for their buck. For example, instead of bidding on an ultra-competitive keyword like “donations,” Sides suggested bidding on something like “donations for hunger.” This type of keyword will likely have less bidders, giving your ad a better chance to be seen.

While Sides has seen “good progress” with her clients using the new CPC cap, there have been some issues.

“Since your clicks are more expensive, you will get less of them,” she explained. “So it actually could hurt traffic if you bid too high all the time. You want to use your money as efficiently as possible.”

Part of that efficiency comes from adapting to the new changes. Sides suggested trying out the new bidding cap for a week and then adjusting bids based on your ads’ performance. “Some of the broader words that are costing you a lot may be poor performers that are eating into the budget and impression share for keywords that may be more targeted and actually bring you conversions,” she said.

Another thing you need to keep a closer eye on is budget allocations. Campaigns with competitive keywords included might be costing you more after the bid increase, and Sides said organization s should pay attention to those and figure out if you need to cut budgets to give better performing campaigns more views.

Sides also noted that since the change, Google announced that advertisers not using grant money on ads would be prioritized, and grant users would be pushed down farther. “So far we’ve seen average positions decline slightly, but not significantly since that change was implemented,” she said.

These issue aside, Sides said that the new changes are a net positive for nonprofits. “It’s just a good way to get extra resources, which is something nonprofits are always striving for,” she said. The biggest challenge now, she thinks, is getting people aware of how the new changes work. While all of her clients have been aware of the new change, they were unsure of how it would affect them.

“It seems they are most concerned about not keeping everything at $2.00,” she said. “Some are worried this will keep spend levels low and they might miss out on some extra traffic.

“But if you are maxing out your grant money, it’s not smart to ignore bid adjustments; in closely managing bids and not just setting everything to $2.00, you are allowing room for your best performing keywords to show more often, and reducing the amount of impressions for broader, more competitive keywords that may cost more but not bring in the right audience, and won’t result in as many conversions.”

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