Don’t shoot the messenger

When I saw a headline the other day saying that research has showed that paid online ads “generate virtually no increase in sales”, I dropped everything to have a read. We’ve got 40 clients here who’ll tell you something different, for a start.

So, what was the story? Well, it was serious because it was in the Harvard Business Review. But it fell down immediately once you read who the story was about: eBay. To be honest, a bigger story would have been that eBay does make money from its online advertising, which has been the butt of jokes for many years:

Bad eBay ads

Here’s what happens. eBay has simply “carpet bombed” Google AdWords with ads for what appear to be every word and phrase in the English language. Whatever you typed into Google over the years, if there was a cheap ad spot going, eBay would have been in there. The results are often hilarious. And this is the opposite of what serious AdWords advertisers do, which is to focus constantly on the search terms which bring the best ROI. I often have to explain to clients that even though they sell blue widgets, the data suggests that it might be better use of their budget not to advertise on that specific search term. That’s not a problem for eBay, which will advertise on anything. No wonder it wasn’t a good investment.

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