Today’s blog caters to experienced PPC advertisers that are already familiar with the KeyWord Insertion (KI) feature (click here for Google’s tutorial about this tool).  KI can be a useful resource, or costly mistake when used at Google AdWords, Yahoo Search Marketing or MSN adCenter. One thing I have learned after reviewing hundreds of PPC accounts at JumpFly is that looks can be deceiving. Even though results may appear good on the surface, sometimes a closer look will reveal surprising results.

Please take a look at today’s image. Initially it appears like Albert EinstePPC Advertisingin, but if you stand back 15 feet from your screen, it becomes Marilyn Monroe. It’s crazy. What first appears clear, becomes uncertain. This is the fate of KI.

For those of you properly using KI, the likely results are ads with better CTRs than other ads not using this feature. I find this is frequently the case, which makes sense, since ads using KI will likely appear to better cater to what the user is searching for and contain more bold terms. However, based on accounts that I have reviewed, I witnessed that ads using this feature usually have a higher cost per conversion. What? That’s right. Despite the higher CTR, and resulting improved Quality Score associated with using KI, ads that did not use KI usually outperformed when it came to cost per conversion. This brings to light the little known fact that PPC ads with the highest CTR are not always the most effective ads.

This can be quite significant since many advertisers allow the best performing ads, based on CTR, to run more frequently and eventually 100% of the time. Therefore, ads using KI, which frequently provide a better CTR than other ads, will then be used exclusively regardless of the ads’ cost per conversion. This can be a costly mistake. Each ad’s cost per conversion must be considered when applicable. For accounts that do not have conversion tracking, I would likely steer clear of this tool, unless the goal is to generate the maximum amount of traffic, versus the most qualified traffic.

I should mention that I have seen KI used successfully, but it is the exception to the norm.  I suspect the vast majority of PPC advertisers using this tool are doing so improperly, and even some PPC management firms are likely misusing this feature. So if you choose to use KI, do so cautiously and review the cost per conversion associated with your ads.