A couple of weeks ago, Google made a major announcement: they announced that they’ll force “close variant matching” on all advertisers.
Why is this important?
#1: Because this means phrase and exact match, as we knew them, are dead. It’s now all broad match.
#2: Because, based on some figures compiled by industry insiders, this could reduce your account profitability by up to 17%.
Here’s what I wrote about “close variant matching” earlier this year:
“Last year, Adwords changed phrase and exact match keywords to “Include plurals, misspellings and other close variants” as standard.
Having seen the results of this, it’s really just another form of broad matching.
While I think broad match keywords have their time and place, they should be added as broad match keywords, not dirtying up your data (and messing up your ad group structures) by being included in phrase and exact matches.”
What I didn’t realise at the time was just how damaging it was. Brad Geddes – author of “Advanced Google Adwords” – compiled figures that show how variant matching impacts cost per conversion.
As you can see, the cost per conversion of variants was 71% higher for exact match. 125% higher for phrase match. This data is in line with estimates produced by Wordstream, who have access to a huge number of accounts.
So, as you can see, adding in these impressions – searches you never asked for – can be very harmful to your bottom line.
So Why Are Google Doing This?
Their reason, given in their announcement, is to give advertisers, “Control with less complexity”. But that’s Orwellian doublespeak. They’re taking away control.
And, as for complexity, variant matching was already the default. So, the only people opting out were opting out because they understood the downsides of using it.
The real reason is that it’s going to make Google a lot of money. I’ve seen figures that say it could be up to $1bn a year in added click revenue. (See figures here: http://resources.spyfu.com/loss-exact-match-sad-losing-phrase-match-will-torpedo-profits/)
Because, like “Enhanced campaigns” last year, it’s a way of forcing unwanted ad inventory onto advertisers.
As I said in a recent article called “Is Google The Enemy?”
“Google’s goals are not your goals… except in the sense that both of you are trying to maximise your profit: you by bringing in customers at a profit, them by getting you to pay as much as possible for those customers…”
Expect Google to continue to pull stunts like these. They’re a monopoly, and they’re treating their customers badly, because that’s what monopolies do.