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Hey DEX! Tell me, who is the “Best” Plumber in Seattle?

I’m just payin’ some bills with these ads

According to DEX Media’s website, when you sign up for a Search Engine Marketing program with them you get “A team of certified local search experts to monitor the performance of your campaign and adjust, when necessary, for optimal results.”  After what I discovered yesterday, I wonder if this team of “experts” has taken the year off?  I also wonder exactly what they would consider a “necessary adjustment” to optimize the results?

Yesterday (7/8/14) I was researching a company that I was planning on calling to offer my services to.  They are paying Reach Local to run Pay Per Click ads for them, and since my markup is 40% less than the alleged 60% Reach Local charges (shameless plug), they are a perfect candidate to become one of my customers.

Anyways, I digress.  The company is called “Best Plumbing” (Yep, that’s a free link I just gave them.  It might help their SEO a little but secretly, I’m hoping they have their Google Alerts turned on, they find this link, and they call me.  If you are from Best Plumbing you REALLY should call me).

Best Plumbing is located in Seattle, so I did a search for “best plumbing seattle.”  Here are the results (click to enlarge):

DexInfoGraphic

7 (the yellow highlighted ads) out of the 11 available ads are Dex Media customers.

4 of those 7 have the ad headline “Seattle Best Plumber”

Of the 3 remaining – 2 use the headline “Best Plumber” (so 6 out of 7 have “Best Plumber” in the headline)

and 1 is a “Quality Plumber”.

All 7 of these ad’s do something that DEX has been doing for years:  They direct traffic to a horrible “profile page” instead of the customers website (this decreases already pathetic conversion ratio’s even more)

None of these ad’s have compelling content written in them

 

Why all this is Bad, Bad, BAD for these DEX Customers.

These pathetic excuses for an ad are hurting these customers in many ways.  First, the Click Through Ratio has to be abysmal.  A low Click Through Ratio means that, most likely, the keywords that trigger these ads have an incredibly low quality score.  A low Quality Score means that you have to pay more for your clicks, or that your ad is shown in lower positions.  Second, IF (and that’s a BIG ASS IF) these ad’s get any clicks at all, the conversion ratio of these landing pages has to be pathetic.   There is nothing on these Dex Profile pages that would convince a potential customer of these plumbers to pick up the phone and call.  Lastly, if the customer ever decides to leave Dex – they don’t get any credit for the history of the account (in this case, that’s probably good since Dex is doing such a bad job of managing it).

The problem continued onto page 2, 3 and 4 of the Search Results.  On page 2 there are 5 more customers (who’s ad’s didn’t show on page 1).  On page 3 there are an additional 2 Dex Customers and on page 4 there is a final lonely Dex customer.  By the time I reached page 4, I was tired of looking so I stopped.  That’s a total of  15 Dex customers, for one search phrase, in one city.  Most of them use the headline “Best Plumber” or “Seattle Best Plumber”.  A couple of them use the headline “Quality Plumber”.  None of them has compelling content, and none of them sends traffic to a page on a website that might convert a customer.  In my opinion, this is a con of epic proportions!

Who’s interest does Dex have in mind with campaigns like this?  Where is the “team of certified local search experts to monitor the performance” of these ads?

This type of stuff pisses me off to no end.  Every single one of these customers has been suckered by DEX and is wasting their money with garbage programs like this.   I have also heard rumors that Dex is charging a markup of up to 50% on the clicks.

 

google

Why a small AdWords Budget is a waste

I’m just payin’ some bills with these ads

A Deadly Pay Per Click combination:

Low Budget + Bad Management + High Markups = Money in the Toilet

In most cases – and underfunded Pay Per Click Budget is a complete waste of money.  Not because you can’t have a successful campaign on any budget, but because of the way that most companies run AdWords Campaigns. When you combine a poorly ran campaign with huge markups and a low budget, you might as well be flushing your money down the toilet because you are NOT going to get any customers from your investment.

Companies that have ridiculous markups don’t usually tell the customers their markup at all.  Most customers are not educated enough to know that Google actually requires AdWords re-sellers to share this information, and that Google goes so far as to warn the small business owner about companies that do not share cost information.  (Google Advertiser Guide)   (Google Third-Party Policy)   (Google Third-Party Policy FAQ)

Three of the biggest offenders of mixing under funded campaigns with poorly ran campaigns and having ridiculous markups are Dex Media, Hibu, and Reach Local.

Pay Per Click Example:

Here is a hypothetical, but VERY MUCH a real world example.  Suppose you are a plumber in the city of Seattle, WA.   The sales rep from a Pay Per Click re-seller tells you that in order to “Dominate” the competition – you need to spend $2,000 per month, in order to “Compete” you need to spend $1,500 per month, and in order to just have a “Presence” you need to spend $1,000 per month.  You reply – “I have a budget of $600 per month”.   The Sales Rep says “Great” and signs you to a 6 month contract @ $600 per month.

Now let’s apply some basic math to this equation:

$600 per month – 40% (their markup*) = $360 left for ads

$360 / 30 days per month = $12 per day

Most clicks come from the word “Plumbing” so that word is “broad matched” in your campaign.  (this means that any time the word “plumbing” is in a search, it can trigger your ad to display.

According to the Google Keyword Planning Tool – as of today (7/9/14), they recommend a bid of $11.92.  That does not mean you will pay that – it’s just the suggested bid from Google.  If you bid $5, your ad probably doesn’t show up, if you bid $50 – your ad will show up – but will cost you way more than you should have to pay.

Someone at home types in “plumbing company, Seattle WA” and an auction is triggered.  You ad shows up in the 4th spot and the cost is $5.

If your Average Cost Per Click were $5** – you could get 2 clicks per day.

2 clicks a day = 60 per month.

60 clicks per month X 1.5% (average conversion ratio – conversion = phone call or contact form filled out)

If you are lucky – you might get 1 conversion.  This may or may not be an existing customer, and it may or may not lead to a new customer – it just means they contacted you.

If you land the customer AND your profit per customer is over $600 – then you got a positive return on your investment.

If not – then you got screwed.

* the big companies have markups as high as 60%
** average cost per click for a plumber in Seattle for the keyword "plumbing" is likely to be way higher that $5.

There is just no way that the small business, with a small budget get’s a positive R.O.I. from Dex, Hibu, or Reach Local.

It is possible to take that $600 and turn it into a successful campaign, but it requires choosing specific “exact match” or “phrase matched” keywords, setting up the campaign to only run during periods of lower competition, and narrowing down the radius where the ad shows to a very specific target.

If you factor in that companies like Dex also send all their traffic to a profile page and not the actual website – the problem get’s even worse.

Are you a customer of Dex, Hibu, or Reach Local?  What has your experience been?