We asked the leading industry experts about search in 2022 and what might happen in 2023. Today we talked to Mike Ryan, Head of Ecommerce Insights at Smart Ecommerce (smec).
Mike combines an extensive background in retail operations with domain expertise in digital marketing. Mike has additional experience in data visualization, automation technology, and leading innovation projects. He hosts the Growing Ecommerce podcast and has spoken at events including SMX Advanced, Hero Conf, and Friends of Search. You can also find him on LinkedIn and twitter (@mikeryanretail).
When his head’s not in a spreadsheet, Mike is spending time with his family in the picturesque Austrian countryside.
What did you love about Paid Search in 2022?
“Love” would be overkill, but I was fascinated by the launch of Performance Max campaigns. When you view PMax as an extension of Google’s years-long efforts to build and roll out automation, it’s obvious this didn’t happen in isolation. Nevertheless it was one of the biggest, fastest launches we’ve ever seen in Google Ads. There was so much to learn – and that remains the case. 2022 was all about change management, setting baselines, and nailing the peak season. People are touting best practices already, but I’ll side with Kirk Williams here and say these feel a bit flimsy so far. 2023 is when we’ll see real testing and innovation occur.
What did you hate about Paid Search in 2022?
Hate is another strong word. Ugh, I’m so middle-of-the-road that it hurts – but I’ll play along. I mentioned change management above. I would have appreciated a LOT more consideration and support from Google toward advertisers. The economy, supply chain, consumer behavior, and total business environment are massively shaken by three years of pandemic and post-pandemic whiplash plus enormously confusing second- and third-order effects. It is such an uncertain time for companies – and the individual human beings behind those companies.
Perfect time to massively upend the way our campaigns work and the way we use our on-site analytics.
Did I hate that? Yeah, pretty much. Not on my behalf – I get paid to be a nerd and stay on top of things – but on behalf of the businesses who just did not need that extra stress and complexity.
What do you think 2023 will bring for Paid Search?
Automation and the reaction toward it will be the dominant trend in 2023 – same as the last few years. I think we have seen three groups coalesce: hackers, harmonizers, and hesitators. What will change in 2023 is the size of those groups.
To define them quickly: hackers try to use automation in ways it wasn’t intended, usually to achieve additional control; harmonizers accept automation and try to best organize it within their strategy; and hesitators lag or resist adoption, preferring the benefits of conventional workflows over the benefits of automation. This is a short answer and I don’t want caricaturize those groups but to offer a glimpse.
Until now, I’d say a large majority of advertisers and agency partners have been either hackers or hesitators. In a tight economy with brutally high competition, the hesitators will be at-risk. Google themselves warned back at GML ‘19 that these people could see disintermediation within three years. That clock is up.
Hackers might find fewer footholds as Google works to hermetically seal the Ads black box. More insights and options will come, but these will be on Google’s terms and the thought that goes into how they are structured and delivered will be pretty airtight. Loopholes are likely to get removed.
Harmonization is therefore the big opportunity. In my assessment, there is often (usually) a lack of up-to-date, comprehensive systems thinking in Google Ads accounts. I mean looking at the totality of an Ads account like a clockwork or an orchestra and having a logical, strategic reason for every component. Ok, PMax is a dominant player, but that doesn’t mean the absolute death of other campaign types – not even Standard Shopping. Which campaign types are in place and why? What is the role of each, how do they play to each other’s strengths and compensate for each other’s weaknesses? How is budget allocated and why, how are goals set and why, what is the optimal amount of segmentation and why? There will be no general formula for these questions, and it is something that cannot be automated. Also, we cannot just think our way out of it, we’ll need to test and iterate.
Given enough budget and a decent website, Google Ads works increasingly well out-of-the-box. The in-platform numbers look great – but the question remains if it truly works hard enough: is the traffic truly incremental and profitable? In a year likely to see reduced aggregate consumer demand, it will be vital to check both of those boxes.