Lessons Learned: Why Google AdWords Failed Me

I’m still very much a “newbie” with regard to running an online business, but I think I’ve learned something over the past few months about online advertising. In this article I’ll talk about what I’ve learned and how my approach has developed over time.

Google AdWords

When I first got started with online advertising I did what most folks do: go to Google AdWords. In fact, I didn’t even consider any other advertising avenues at first (which turned out to be a mistake, but more on that later). Before going any further, here’s an extremely oversimplified description of how this all works:

Google already an enormous index of Internet content. They’ve developed very complicated algorithms to try and figure out what each piece of content is about. It uses the content and algorithms to show you web pages that are related to the search terms that you type in. It didn’t take long before they started using that same process to show advertisements to people based both on the search terms that they enter and on the websites that they visit. Through the AdWords advertising platform Google lets you create advertisements and associate them with keywords. They then use those keywords to show your ads to people who are searching for or viewing related content. Each time Google shows an ad to someone it’s called an ‘impression’. Each time someone clicks on an ad it’s simply called a ‘click’. As the creator of the ad you pay each time someone clicks on your ad. Simple right?

Ok, not exactly simple. When you first get started with AdWords it can a bit… scary. AdWords is filled with seemingly endless metrics and options; quite honestly I don’t think I could tell you what even a fraction of them mean. People have built entire careers around running AdWords campaigns for businesses and after a few hours of using it it’s easy to see why. I’ve spent many hours and dollars using AdWords. How many? Well, far more than I’d care to admit. After all of that time, energy, and money, guess how many sales AdWords has generated for me? Zero.

So what gives? AdWords is the way to go right? It’s basically the only show in town for online advertising! I mean, just look at all those options! It’s so complicated it has to be good.

Sarcasm aside, AdWords is good. It’s hands down the most sophisticated advertising platform with the farthest global reach of any out there. Unfortunately for me it’s those same strengths that make it such a poor fit for my business. Since time and money are in a neck-and-neck race for being my scarcest resources, I simply don’t have time to figure out AdWords.

Another reason AdWords doesn’t work for my business: it’s all based on showing ads to people who are searching for products. I sell eyewear with interchangeable temple inserts. This is a completely new concept to most people. No one is going out and searching for my product. Meanwhile AdWords makes me compete with the likes of major brand names and “off-brand” warehouse websites with enormous marketing budgets for keywords related to eyewear. There’s no way I can compete in that arena.

Remember back in my very first post when I talked about how I went about starting an online business backwards? I didn’t do what you’re supposed to do and start by researching products that people are searching for online. Rather, I started with the product. As it turns out, already having a product to sell (especially one that people aren’t familiar with) makes using AdWords an uphill battle.

Enter Facebook

After a few weeks of futile AdWords campaigns I decided to give advertising on Facebook a try. At its core, Facebook’s advertising platform is very similar to AdWords: you set up campaigns, define budgets, and create ads. The key difference between these two platforms is how you define a target audience for your ads. Rather than defining keywords that describe the products you’re trying to sell, Facebook lets you target your ads using user profile data. You can target ads by any combination of age range, gender, geographic location, interests, and education level. If you stop and think about that for a minute you’ll realize that this is an insanely powerful advertising platform. That said, comparing AdWords to Facebook Advertising is definitely an apples-to-oranges comparison.

AdWords is a great tool if you have a product or service that you know people are looking for online. People are always searching Google for “cheap designer sunglasses”, so if you sell designer sunglasses at deep discounts AdWords is where you want to be. Facebook Advertising works better for things that might be considered an ‘impulse buy’. To illustrate what I mean by this let me tell you a little bit about my first foray into Facebook advertising.

My wife and I have dogs and like all crazy dog people we love them like family. One of our favorite designs that we sell depicts a Boston Terrier and is called “Stella Special” in honor of our dog Stella. I realized one day that other crazy dog people would probably like this design as much as we do, so I created a simple Facebook ad and targeted it at people who had “Boston Terriers” listed in the “Interests” section of their Facebook profile. Within 10 minutes of starting that ad we had our first order come in. That’s what I call results.

I don’t expect that people would ever go online and explicitly search for “Boston Terrier Sunglasses” because it’s not something that people would even know exists. If you can put some Boston Terrier Sunglasses in front of people who you know like Boston Terriers, however, you’ll generate some sales. So my current marketing strategy has two major components to it:

1. Create designs that people will love or be passionate about.
2. Put these designs in front of those people.

Because it’s so easy for us to create and produce new designs, this approach lets us constantly experiment. Some designs generate interest and some don’t, but it only costs us the time involved in doing the graphic design work and a meager Facebook advertising campaign to find out which ones are worth a larger investment.

The Lesson

I want to be clear that I’m not trying to put AdWords down in any way. As I said, I think it’s the most sophisticated and wide-reaching advertising platform available; it just doesn’t work for my particular business. That said, it’s not the only platform in town and I think that virtually any product or service could make use of the Facebook Advertising platform by targeting people who are likely to be passionate about what you’re selling.

Fake It Till You Make it

A friend of mine recently asked if I had some kind of marketing firm helping with our “online presence”. I laughed a bit when I first heard the question and thought, “Are you kidding me?”, until I started to think about it some more. Between the main store front website, the blog, the facebook page, and our twitter account PiX Eyewear actually has a pretty decent online presence; especially considering the company only consists of three employees; all of whom work on it part time. I won’t lie: it takes a bit of work to keep all of this up, but it’s not nearly as involved as it sounds.

Store Website

As I mentioned in my previous post, we use Shopify to create, maintain, and host our store website. They have loads of layout templates you can choose from and it really didn’t take much effort to have a professional looking and functional online store front.

PiX Eyewear Blog

While I don’t post to it as often as I should, I do maintain a blog on the PiX store website in addition to this blog. Shopify comes with the ability to easily add blogs to your store, so once again this was “point-and-click” simple to get started on. The blog functionality they offer is fairly rudimentary, but in my opinion it’s “good enough” for posting quick articles about the goings on of the company. These articles are great things to post about on the facebook and twitter page.

Facebook

If you had asked me several months ago what kind of role I thought facebook might play in the development of my online business I probably would have answered, “little to none”. As it turns out I would have been dead wrong. Facebook is playing an enormous role in the development of this business in a couple of different ways. I have plans for a future post about how we’re leveraging facebook advertising (and why I consider it better than Google Adwords in some ways), but for now I’ll focus on our PiX Eyewear facebook page.

I’m not entirely sure how facebook “fan pages” evolved over time, but in their current form they’re essentially a way to create a facebook profile for an organization as opposed to an individual. These profiles have a wall that you and others can post to, photo albums, a discussion board, and a number of other features designed to help you interact with other facebook users on behalf of the organization. Forbes.com recently posted a great article describing the process of creating a facebook page for your business that sums up the process far better than I ever could.

Twitter

More and more businesses are using twitter as a way to interact with current and potential customers. I don’t think I need to go into the “why” of having a twitter account for an online business. It’s free to setup, easy to use, and I think it’s a pretty decent medium for keeping in touch with customers.

Bringing It All Together

It would be a lot of work to keep a blog, facebook profile, and twitter account updated on a regular basis, which is why I cheat a bit. On any given week I’ll typically do something like this:

• Write a blog post on the store front blog. This post doesn’t necessarily have to be very long and is often quite short.
• Post to the PiX Eyewear facebook profile about the new blog post, inviting the people who follow us there to read it.
• An application automatically posts whatever I put on the PiX Eyewear facebook wall to the PiX Eyewear twitter account.
• Once or twice a week I’ll also add a picture to facebook of a new style that we’re just created. This also gets cross posted to twitter.

That’s it. I spend a few hours a week on this and maintain what I consider a pretty impressive looking online presence for the business that I run in my spare time.

Tech Issues: Website

Obviously, technology plays a big part in starting an online business. This will be the first in a series of posts about the technology I’m using for my online business. I’m a software developer by trade and sometimes want to “geek out” a bit on this blog. That said, I want this blog to be useful to a wide an audience and will make every effort to keep these posts intelligible to the masses.

Step One: You Need A Website

You need a website to have an online business. I’ll cover a lot of topics in this series, but none so fundamental as the website. I started working on the website for my business before I had chosen a domain name, setup company e-mail, or determined a payment solution. Given that I have a background in software development, I had to decide whether I wanted to try and build my website “from scratch” or try to find an off-the-shelf solution. It may surprise you to hear that I really only considered the “from scratch” option for about 30 seconds before deciding against it.

I’m Not The IT Guy

I’m a software developer with plenty of web development experience and could certainly have rolled up my sleeves and started coding an e-commerce website for myself. There are even a number of existing software libraries I could have used to making things easier. I could have built and tested the entire website on my computer at home and then found a company that would rent me space on of their servers to make the site available to the masses. So why didn’t I do this? I’m not the IT guy. I love my job as a software developer and feel really fortunate to be able to make a living doing something that I enjoy, but I didn’t start this business to build a website. I started this business to develop a product and a marketing strategy to generate profits. Rather than building my site from scratch, I wanted a platform that would give me the basic elements of an e-commerce site right “out of the box”.

 

 

A Solid Core

I ultimately opted to go with an e-commerce platform called Shopify. I had heard a lot of good things about the service and signed up for their 30 day free trial. Within a few hours of playing around with my account I was convinced that this was the way to go. In my opinion there are a few key things that an e-commerce site absolutely needs:

• A clean layout with search-engine friendly elements.
• A database for easily creating, managing, and organizing your store’s products.
• A shopping cart that will remember the items a customer had even if they close the browser and return to the store several days later.
• Integration with a payment gateway so that you can accept payments from your customers electronically.

With Shopify, all of these elements are baked right in to the product. I don’t intend for this post to become an advertisement for Shopify (and I can assure you I’m not being compensated by them in any way), but I definitely strongly recommend them as an e-commerce provider. I could go on and on about all of the useful features they offer, but it all can be summed in pretty easily: They take care of the mundane details of running a website and let you focus on developing and marketing your products.

But What If I Want My Site To…

I feel confident saying that anyone with basic computer competency (i.e. knows their way around a web browser, can upload pictures to a website, is proficient with e-mail, etc.) can get an e-commerce site up and running without having to hire any professional help. That said, Shopify is an e-commerce platform for the masses and might not be built to do exactly what you want in all cases. Fortunately they expose a number of extension points that let you dig into the inner workings of your site and tweak it to your liking. Unfortunately, without at least some background in computer programming and/or web development you will probably get lost pretty quickly. Shopify does maintain a “Job Board Forum” where you can post the custom tasks that you want to accomplish and have developers experienced with the Shopify platform bid on them.

And The Cost?

This is a blog about bootstrapping, so I’d be missing the mark if I didn’t talk about what all of this costs. To be clear, the costs I’m talking about here are solely for the creation and ongoing hosting of your website. This doesn’t include domain names, e-mail, advertising, or any of the other expenses involved with starting an online business.

If I had opted to build my own website from scratch the only real tangible cost I would have would be in the form of some basic shared hosting with a website hosting provider. Price ranges for this kind of service range from very cheap to very expensive, but I estimate that I’d probably have needed something in the neighborhood of $15 - $20 per month to get started.

With Shopify, they have a multi-tiered pricing scheme. The entry level plan costs about $25 per month. In addition, they charge a 2% transaction fee for each sale that takes place on the site. The $25 per month plan is a good one to get started with, but you’ll probably want to upgrade to the next level up before too long. The entry level plan doesn’t offer discount code functionality and limits the products you can sell to 100. The second level plan costs about $60 per month with a 1% transaction fee. Obviously, this is more money than the $15 - $20 that I estimated for the “from scratch” approach, but this doesn’t take into account the hours I would have had to spend building my own site. It’s difficult to estimate and quantity how many more hours I would have had to invest into the “from scratch” approach, but I have no doubt that it would have been a much larger effort overall.

Remember, your time is worth something. In my opinion, a service like Shopify is well worth the expense given the time you save.

Design Evolution

This is another guest post from my father about the origins of the product. It’s not necessarily related to the process of starting this online business, but I think that these stories are interesting. I hope you agree.

Clothing For Your Sunglasses

If you read my previous post about how the idea for this product came about you may recall I used the term “temple arm clothing” to describe my idea. I wanted to create a direct link between the fashion world and eyewear frames. Since clothing is such a fashion industry mainstay it seemed natural to liken this idea to clothing. This idea lead me to make the first prototypes using things like fabric and gem stones. These initial prototypes actually worked pretty well and one of our early customers from Germany still orders these inserts made from fabric. For this initial design the temple inserts weren’t completely flat like most of them are today. Instead they had a slightly raised edge so that the fabric could sit within the edges. The edges helped protect the fabric from wear and tear as the inserts went in and out of the frames. These raised-edge temple inserts are still used today for things like our “mother of pearl” inserts where some exotic material has to be applied to the plastic insert.

Scaling Issues

While these fabric based inserts looked great, we couldn’t always rely on a continuous supply of the needed fabric material without buying it in very large quantities. This lead us to come up with a digital process where we could take any image and transfer it onto the face of a blank plastic insert. The transfer process caused us to start using a completely flat temple insert rather than the raised edge design. Adding a simple clear coat on top gives these digital transfers a shiny gloss finish and protects them from flaking or fading due to exposure to UV light or moisture. This process now lets us quickly and easily create digital designs that can be applied to any of our sunglasses or reading glasses and make the digital prints on-demand. The sky is the limit on the number of designs that we can create and sell. We’ll be leveraging this flexibility over the coming months to push out new designs on a weekly basis and even invite graphic artists and designers to submit their own designs.

Patience and Persistence

I’ve found that there are many challenges to getting a new online business venture off the ground. I had anticipated a lot of these challenges but have encountered a few that I simply didn’t plan on. By far the biggest challenge I hadn’t anticipated is the waiting. You can spend countless hours tweaking your website layout, crafting witty product descriptions, and developing advertising campaigns, but you can’t speed up time. You won’t know if any of your efforts were worthwhile until you let enough time pass to evaluate your results. My current thinking is that any long term success this business might attain will boil down to two things: patience and persistence.

Patience

I’m not by nature a very patient person. I suppose I can partially blame a technology laden lifestyle that has gotten me accustomed to instant gratification. It might only take me an hour to upload new products to my storefront, but I always have to wait a few days before I can see whether or not anyone likes them. I really struggle with this delay, but have to learn to live with it. In a way I’m fortunate that this business is a “side project” for me and that I have a challenging full time job that keeps me occupied for a good chunk of the day. If PiX were a full time venture I’m fairly certain I’d drive myself insane sitting around and waiting for things to happen. I also sometimes fear that my impatience causes a lot of churn because I don’t let my ideas take root for long enough to be proven good or bad.

Persistence

Tim Ferris has an interesting post on his blog titled, “Harnessing Entrepreneurial Manic-Depression: Making the Rollercoaster Work For You” in which guest author Cameron Herold describes the manic-depression that a lot of entrepreneurs experience through the course of getting a new business venture off the ground. This article rings true to me in a lot of ways. I can’t even begin to describe how awesome it feels to see order notification emails roll in; it’s truly a bit euphoric. The high of that feeling is only matched by the low I feel when a week or two goes by with no orders. To put it bluntly: it sucks. Cameron’s article has a lot of good suggestions for dealing with this roller coaster that I’ve found very helpful over the past few weeks. I also need to constantly remind myself that I need to plow through the down times. I really and truly believe that this product is good, but I’ll only succeed if I keep trying.

Keep It Going

“Patience and Persistence” has become a mantra for me lately. There will be plenty of small defeats and victories along the way, but in the end I will only have failed when I give up.