One thing I've been noticing as we access more accounts is that although people are getting good CTR, they are often getting it because they have generic keywords and are not using exact or phrase match. Following on from that they can't quantify the exact context in which the ads are being clicked.
I know we normally talk about widgets, but I figured a few words to illustrate the contextual errors might help, without it giving any games away.
Take the words "tickets", "orange" or "loan". They are so generic that it would be entirely possible and entirely probable that advertisers could get both good click numbers and CTR.
But, hidden within the traffic would be a whole bunch of people looking for, plane, train, sport, parking tickets; recipes including oranges, fruit suppliers or phones; home, bank, car loans. It is also entirely probable that even at 20% conversion of the contextual relevancy of the clicker to your ad, you'd still make good ROI in most cases.
Imagine though if you could eliminate all of the non-relevant visitors? Many people have said that "well if they clicked on my ad they must have been looking for what I was offering".
Now maybe so on Overture, Espotting and others, but at 25 title/70 description sometimes it's not easy with Adwords to get the message across with absolute clarity. We analysed the time spent on sites by some visitors prior to taking over clients campaigns and often it was much less than 20 seconds, when the keyword search was obviously out of context.
The system Google have built is fantastic. If everyone had $100 to spend they'd have about 3 or 4 different ways to take it off you by using different "techniques" including :
1. Your minimum CPC is less than it needs to be to have your ad shown in the US
2. Your CTR is below a certain level, so pay more, change it, but unless you do we won't have you taking up bandwidth
3. Your ad is brilliant, we think it's so good we want even more people to click on it by putting you in a prime location
Marketing genius. The aim is to ensure that if everyone has equal budgets, they will all part with it at the same rate, they reward some aspects of ad creation and penalise others.
I am definately with Mikkel though, we love the way the system works.