Larry Kim Is Wrong About Smart Goals

This post is a follow up to my original post regarding AdWords’ announcement of Smart Goals to stand in for actual conversion data last week. Larry Kim of Wordstream seemed to take unusual offense at my stance, choosing to highlight comments made on my original post by Melissa Mackey and myself in a pretty insulting way.

Here is what he wrote:

This is kinda big news for the less-sophisticated advertiser.

But, as expected, there’s no shortage of opinion on it. And spoiler alert: some people think smart goals are dumb:

about google adwords smart goals

(More discussion on that here.)

I’m not really sure why he chose to open the piece by essentially mocking Melissa and me – two respected paid search industry experts? His post could have been effective by just referencing the fact that there are varied opinions on the topic and then diving into his take. Look, I invite discussion about topics I post on. I end virtually every post by asking others what their takes are and if they disagree with me to jump on in to a discussion. Since that didn’t happen, let me get that ball rolling!

Let’s go point by point, shall we?

Smart Goals Are Not Dumb, However

OK, so not everyone is a fan, but at least it’s getting smaller advertisers to finally get some form of conversion tracking.

Let’s move past the idea of whether or not smart goals are, in fact, dumb (which they are). Getting bogged down in that misses the larger context, which is that Smart Goals are slickly packaging nothing and selling it as something. Smart Goals do not track any type of ACTUAL conversion path.

By definition they can’t – they are for businesses who can’t or won’t define a conversion. You cannot track something that does not exist. At least not if you want to correlate actual dollars with actual data. If you’re comfortable correlating actual dollars with made up, aggregated, averaged, magical data well, I guess you won’t find them dumb or dangerous?

Google created a cool new way to bring in machine learning that aggregates data from a ton of sites that have opted in to share anonymously. Based on some magical formula, advertisers can quickly see which visits are likelier to convert, and then optimize their AdWords campaigns to match. (Emphasis mine).

First off, that part reads like a Google press release. And is he seriously encouraging people to participate in something he himself describes as being based on some non-disclosed magical formula?

But it’s easy to say it’s garbage when you’re used to working with savvy advertisers that have limitless resources.

I don’t want to speak for other PPC pros, but I can certainly say for myself that I work with businesses at all levels of savviness and resources. And I can tell you this, even the least sophisticated businesses out there still understand the concept of “what am I getting for my money” even if they don’t get complex ROI formulas.

You know why most businesses who think “AdWords doesn’t work” think that AdWords doesn’t work? It is because their money is being wasted and they do not see any tangible results from their efforts. Most businesses I encounter when I’m at non-search industry events are hungry to be able to do search better. Telling them that they can do it without having to think about what they actually want as a tangible result of paid search advertising is just flat out wrong.

Smart Goals: Here’s Why People Need It

There are countless small businesses that don’t have any conversion tracking set up, yet are paying for clicks every month.

Ok, true statement. But Smart Goals, rather than addressing that actual problem, doubles down on that mystery and obfuscation instead of offering an actual solution to a real problem. How about creating some type of tool inside AdWords to help these types of customers define conversions?

In fact, at WordStream, about HALF of the customer prospects that we talk to don’t have any form of conversion tracking turned on when we first meet them. And that’s a real shame.

That is a shame. And it is our job as professionals to help them figure it out. How about instead of pouring God only knows how much in resources into developing Smart Goals, AdWords had instead put it into making it easier for smaller businesses to succeed using AdWords, even without professional consulting help?

But conversion tracking is complex for many businesses to get right…

Not to mention:

  • Even if the code seems like a simple copy/paste, it’s wrongly configured half the time – even high spenders often have messed up conversion code setups.
  • Conversion tracking needs to be maintained over time as you create new goals
  • What if whoever implemented tracking no longer works with you when you need her?

There are ways to certainly define a conversion action, or put even more simply “what is it that you want a person to do as a result of being on your web site”? Whether or not a business takes it further and implements any actual code on web sites is less of the point. Yes, implementing code can be a bit tricky, especially if you don’t have professional help or support with your web site. But Smart Goals sets up the concept that “it must be working because Google is telling me it is working and they have data to back it up” – except they don’t.

Bad conversion data is worse than no conversion data at all.

I completely disagree. Bad conversion data is NOT worse than no conversion data at all. Because bad conversion data, especially in the context of Smart Goals, provides an illusion of being good conversion data. Smart Goals is not being positioned as “hey you should really use our magical made up data to feel better about the money you’re spending with us” by AdWords. It is being sold as a SUBSTITUTE for actually even thinking about what a conversion should be, much less implementing any type of coding to digitally track such things.

Right about now, some of you may be saying: “Exactly, Larry. That’s why this whole new smart goals thing sucks.”

But, guys, it’s better than the alternative. ObviouslyI [sic] wouldn’t expect smart goals to outperform AdWords conversion tracking when set up correctly and professionally managed. But for all those countless businesses that are shooting in the dark by paying for clicks with no data or terribly wrong data, smart goals is a super move by Google for some of those smaller AdWords spenders who may need a little extra boost.

Smart Goals do not illuminate anything for these businesses who are currently “shooting in the dark”. The only “extra boost” it is likely to offer is to AdWords’ bottom line as they can position their strategies for these poor businesses as being based in reliable, actual data.

And he also failed to mention the little gem I added to my original post as an update:

Note that your Google Analytics view must receive at least 1,000 clicks from AdWords over a 30-day period to ensure the validity of your data. (from the AdWords Smart Goals announcement post)

This is not insignificant, in my view. First of all, for the types of businesses this seems to be aimed at averaging 1,000 clicks a month in AdWords seems like a potentially lofty (and expensive) goal. Secondly, I can’t help but wonder if this will lead to even pushier AdWords reps trying to work with businesses to first get them to the 1,000 click threshold so that THEN they can use the magical made up conversions. That, would be even worse. Double dipping those poor business owners!

So what do you all think? Larry – love to hear from you directly this time too! Sound off in the comments or hit me up on Twitter (@NeptuneMoon).

UPDATE:

Larry Kim and WordStream reached out to both me and Melissa almost immediately after this post went live to offer sincere apologies, as they had no intention of insulting either one of us. That gesture was much appreciated!

Comments

  1. Hey,
    I don’t think Larry did anything wrong here, he just disagreed. I think that must be allowed, especially when it’s with respected industry experts (and when there’s a link to other side’s full post *coughcough*).

    Personally, I can see everyone’s points. I even agree with Larry’s reasoning, although not with the conclusion.

    • Neptune Moon says:

      Thanks for commenting! I don’t take issue with other points of view – I welcome them. I suppose we all can read the tone of a written piece differently as well.

      WordStream has already reached out and apologized for any unintended negativity that was perceived by Melissa or myself. And I appreciate that!

      I love to engage in even what we call in my house “robust discussions” on any paid search topic!

  2. Hi Julie, My intent wasn’t to insult anyone. Often my sense of humor in blogging doesn’t go over as I had intended and so I’m sorry about that. As for the new feature in question, I see no reason why we cannot have different opinions on the matter.

    • Neptune Moon says:

      Thanks Larry. I appreciate you taking the time to comment! I am going to update the post to include that you’d reached out and apologized, in case people don’t follow on Twitter and/or read comments!

      I think sometimes written content can be misinterpreted more easily than in person or via phone or video conference.

      And yes, I totally agree that we can have differing opinions on anything! I love debating this stuff with people who don’t share my viewpoint.

  3. FWIW, I agree with your assessment of the whole sorry escapade. Much of my daily work involves companies with either no tangible goal, or worse, no interest in creating one other than “more sales”. Quite how these folk can operate a business I do not know, but there we are. Smart Goals does seem ideally suited to their business models, and were it better thought through, I’d be all for it. However, it plainly isn’t.

    Plucking some numbers out of the air, “magical formula” or otherwise, helps no-one. Bad data is quantifiably worse than no data, since it leads to ill-informed decisions. When you have no data, you know you are guessing. Bad data makes you think you have wisdom you don’t.

    • Neptune Moon says:

      Thanks for sharing your thoughts!

      I could not agree more about “bad data making you think you have wisdom that you don’t”. Great way to put it!

  4. Great post, even though I am late to the discussion. As a marketing director for a small enterprise, the last gem you spoke of–1,000 clicks in AdWords in 30 days–is a great big rock in my shoe. Apart from ecommerce companies–who will be pulling in much bigger revenue that traditional small and midmarket businesses anyway–small companies who start with AdWords may not even want 1000 clicks in 30 days. But the larger matter is that an ad click is not a true conversion — it’s just a measurement of how many impressions it took for you to convince a visitor to act on your ad. The conversion is when the visitor took your offer–bought your product or service, downloaded your asset, etc. And Google Analytics has plenty of easy-to-find information on exactly how to set up conversion tracking.

    AdWords’ original release makes it sound like a PPC is a conversion in itself, and that companies new to AdWords should trust Google because millions of websites use Google products. But it’s a chicken and egg argument. Most of us use Google because we must. Unspoken in their argument is that every .com is reporting to Google, but that’s simply not true. Dot coms can opt out of sharing their analytics and conversion data with Google’s algorithm, and frankly, even if opting in is “anonymous,” I’d never trust that claim.

    • Neptune Moon says:

      Michelle:

      Thanks for commenting!

      Google does seem to put things out as “features” or “benefits” that are more of a benefit to them than their customers sometimes. I don’t think that this helps clarify matters either, it does kind of muddy click = conversion concept, which unsophisticated folks might thing is correct.

      You’re also right about which sites opt to share their information with Google and if that creates any inherent bias in the data. Love to see the numbers on that!

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