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How to Use the AdWords Search Terms Report to Lower Cost Per Acquisition

AdWords is all about getting the best results.

The goal is to raise click through rates (CTR), lower cost per click (CPC), and decrease cost per acquisition (CPA), all while getting enough impressions, clicks, and conversions to stay in business.

One way to do this is to weed out terms that aren’t performing because nobody wants to bid on a phrase that isn’t converting, even if it does have a high CTR and low CPC.

But knowing which terms to bid on can be extremely tricky. Businesses bid on a variety of exact, phrase, and broad keyword matches, but you don’t always know for sure the exact phrases people are searching for and which ones are converting, especially when you’re bidding on broad match terms.

The Problem with Broad Match Terms

The problem with broad match terms is that your ads end up showing for a large number of search phrases that have less and less of a connection to the keyword you’re bidding on.

The chart below from Google shows what this looks like in practice when you bid on “women’s hats” as a broad match keyword.

Keyword Match

As you can see, when you bid on “women’s hats” as a broad match, your ad will be served for related terms that include synonyms like “ladies hats” and “hats for girls.” This helps to get more impressions for your ads, but it’s not good if you aren’t selling hats for girls and only want your ads to be shown to women.

The benefit of broad match is that you’ll get more impressions, but the downside is that your ad will get served to results that at times have a tenuous connection to what you’re advertising for and sometimes are completely unrelated. This means your Quality Score will go down, your cost per click will go up, your conversion rate will go down, and your CPA will go up as well.

So what can you do about this, and how can you use the search terms report to find negative keyword opportunities in order to optimize your campaigns?

Introducing the Search Terms Report

The AdWords search terms report enables you to find out what exact terms people are searching for and which terms are converting the best.

Once you have this information, you can use it in one of two ways:

  1. You can use it to create new ad groups with keywords that are performing well.
  2. You can use it to find negative keywords to add to your account so you’re no longer bidding on terms that aren’t converting.

Typically, you’ll use the first method early on for a campaign. You can download the report and then search through it to see which search terms are converting well. Once you find a theme that is, i.e. recurring words or phrases that convert, you can create new ad groups to target what people are actually searching for and what’s converting. These new ad groups should lower cost and convert better because you can tailor the headline, copy, and landing page to match what people are searching for.

Then, once the campaign has been running for a while and has gathered more data, you can use the same search term report to find words and phrases that aren’t performing well.

These are terms you don’t want to bid on that can be added as negative keywords so you won’t. Building out an effective negative keyword list is one of the best ways to create better performing AdWords campaigns. (To learn more about negative keywords and how they can be used, read this post from Google.)

How to Use the Search Terms Report

First, log in to your AdWords account, click on “All Campaigns,” and then click on “Keywords,” “Details,” and “All” underneath “Search Terms” as illustrated below.

Search Terms Report

Next, you’ll see a list of the actual search terms that lead people to your site. These terms are based on the broad, phrase, and exact match keywords you’re bidding on, but instead of being keywords, it’s a list of the actual words people type into Google before they click on your ad.

If this is your first time looking at the search terms report, you’ll want to look for any terms that get repeated and that may be a keyword you’d like to add to your campaign or turn into a new ad group.

Let’s say for example that you’re bidding on the term “fixie bike” and notice that people are coming to your site through searches like “how to customize my fixie bike,” “where to buy fixie bike parts,” “cheapest fixie bike,” “fixie bike best for beginners,” “top rated fixie bikes,” and “best price fixie bikes.”

Of all these searches, “cheap fixie bikes” and “best price fixie bikes” convert the best. Realizing there’s opportunity here, you can create a new ad group that will focus on these terms. You can add “cheap fixie bikes” and “best price fixie bikes” as keywords along with other suggested price-related terms. Voila, you’ve identified a new ad group that you can keep a close eye on that hopefully will lead to even more sales for your site.

Next, you can take a look at the list of search terms to find negative keyword opportunities. Pay close attention to terms that have a low conversion rate, a high CPA, or a really lower CTR.

Once you find such terms, you can add the entire term as a negative keyword by clicking “Add Negative Keyword” above the list of search terms. This will exclude that search from your campaign in the future.

Search Terms Report Negative Keyword

When doing this, you’ll have the option to add the term as an exact, phrase, or broad match. Exact is the safest of the options, but sometimes you’ll want to use phrase match if you’d like to exclude the entire phrase from future searches and not just that exact phrase. Only in a few instances will you want to exclude broad match terms since that could throw out a large number of terms you may actually want to be excluded from.

You’ll also be asked if you want to exclude the term at an ad group or campaign level. Here’s the answer:

  • If the term is one that should be excluded from the entire campaign, then you can add it at the campaign level
  • If you only want the term to be excluded from the ad group it’s currently in, then you should exclude it at the ad group level

Both work and will help you to exclude poor performing search terms, but excluding at the campaign level has a bigger impact which means you’ll want to make sure that’s the change you’d like to make.

How to add a negative keyword

Last but not least, you can also download the search terms report if it will be easier for you to work with the information in Excel (such as if you want to use Conditional Formatting to make it easier to review the data). Simply click on “Download” above the search terms report to download data for either your entire campaign or for particular ad groups.

Download search terms report

So there you have it. Now you know how to use the search terms report in AdWords to:

  1. Find new keywords opportunities
  2. Identify new ad groups
  3. Find negative keywords to add to your campaign

By following the tips in this post, you’ll be able to optimize your campaigns to improve overall CTR, lower CPC, and decrease CPA. It’s as simple as identifying what terms people are searching for that are resulting in conversions and then optimizing accordingly. Good luck!

Do you have any questions about how to use the AdWords search terms report to get better results? If yes, leave a comment, and we’ll do our best to answer your question.


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Joe Putnam is the blog editor at iSpionage. You can get in touch with him on Twitter at @josephputnam.