Tiering Keywords by LTV to Structure Apple Search Ads Account

This week we have a guest post about Apple Search Ads from our friends at Incipia. Gabe Kwakyi is a Marketing Leader and Business Developer at Incipia. He has a strength in building, executing on, and analyzing solutions to problems and opportunities. Prior to Incipia, Gabe managed digital marketing campaigns as a search advertising account manager at Microsoft Bing Ads, where Gabe worked with over 150 clients including Airbnb, the NHL and Spotify and managed annual ad budgets of over $21 million.

Apple Search Ads and Google AdWords (web search) campaigns share many similarities, such as search terms, keyword-level bids, campaigns, and ad groups. And while a similar approach to account structure between the two platforms is ostensibly a good idea, the ideal Search Ads structure for intermediate Apple Search Ads managers is actually different from that of an ideal AdWords search account.

Don’t Structure Your Apple Search Ads Account like Google AdWords Search

Apple Search Ads & AdWords Structure

While the central theme in structuring AdWords accounts is relevance, the central theme in structuring a Search Ads account is value. The application of this difference means that an Apple Search Ads manager’s job is even more data-driven than that of an Google AdWords manager, who can focus on optimizing first for relevance, and then refine by value. Apple Search Ads must be focused first on conversion rate, cost per acquisition, and downstream metrics to know how to structure his or her account.

For example, while an AdWords manager would place keywords from competitor A, B, and C into three separate ad groups in a competitor campaign, an Apple Search Ads manager should place the keywords into separate campaigns and ad groups based on the actual value of each keyword, which can differ even within each competitor (e.g. a competitor’s full app name vs the brand name).

The reason for this is that Apple Search Ads does not allow advertisers to customize ads for each ad group, and (so far as we know and have seen) there is no concept of a relevance score held within ad groups. Relevance score is calculated at the app + country level, and is based on metadata, which is kept separate from the Apple Search Ads account itself. When these factors are removed, the only major component to structuring remains value, and value is driven by bid and budget, which is controlled at the campaign level (budget), ad group (CPA goal + targeting), and keyword level (max CPT bid).

Now that Apple has released creative sets, ad groups take on new meaning in terms of relevance as creative sets and keywords within an ad group may relate to different degrees to one another and affect TTR and CR.ASA Campaign Structure

Value – the Most Effective Way to Structure your Apple Search Ads Account

There are different flavors to structuring an account by value, but one of the most effective that we have found is to tier keywords by value. This can be defined by about four or five campaigns per country.

Keywords Tiers in Apple Search Ads Campaign

Due to the fact that searches in the App Store are much more likely to be short-tail than long-tail, the keyword discovery process requires less effort, after the initial exploration phase. This means that there is less need to create a broad match version of each keyword, as search match/broad match will cover more ground more quickly and for a smaller overall total addressable market for search terms in Apple Search Ads than in Google AdWords.

The beginning of this structure (when there is less data on the value of keywords)requires only 3 campaigns: brand, exploration, and tier 1 (known/assumed high-value keywords). The brand and tier 1 campaigns should be made up of exact match-only keywords and should have the highest bids. The exploration campaign’s purpose is to uncover new search terms to add to the tiered campaigns, meaning that it should have search and broad match keywords with bids high enough to be competitive in the auctions and produce search term-level visibility into CPA.

Budget based on High Value Keywords

As the exploration campaign begins to gather search term-level visibility, it will be important to shuttle search terms into tiered campaigns based on their TTR/CR/CPA. Keywords should be negated from the exploration campaign and added as exact match in the appropriate campaign and ad group.

As tier 2 and tier 3 campaigns are created from search terms that convert well, the goal will be to waterfall budget that higher-tiered campaigns do not use into lower tier campaigns. This process ensures that budget is prioritized first by the keywords that drive the most value for your bottom line, while also mitigating the risk of lower value keywords dragging down your profit margins.

Managing Budget in ASA Campaign

Note: the exploration campaign’s budget should also not be factored into the overall ROI equation as its purpose is not to drive ROI. Despite its lower ROI and gradual decline in scale as more negatives are added, the exploration campaign will ensure that your visibility into new valuable search terms is assured.

Within tiered campaigns, keywords should be organized by LTV bands with appropriate bids. Using the ad group CPA is a great way to control bid by value, and a boon that this account structure sets managers up to tap into.

Tiered Apple Search Ads Campaign

How to manage this strategy?

A few challenges to managing this strategy include:

1. Staying on top of budget waterfalling

Typically, the highest value keywords will have the lowest scale, and the lowest value keywords will have the highest scale. It can be challenging to dynamically assign budget to each tier so that the tiers below are able to use any un-consumed budget by the higher tiers, but without throwing your overall ROI out of balance.

2. Staying on top of keyword tiers

As the search term auctions, the Apple Search Ads platform and your app itself change, the value of each keyword will change as well, causing the need to potentially re-categorize keywords according to their updated value. Moving keywords around can cause adverse reactions in performance, especially for keywords with positive momentum.

3. Investing the right level of effort

With lower budgets, this strategy may require more effort than is worth (just like an over-built out AdWords search campaign). The effort level may be reduced by using ad groups for value tiers instead of campaigns; but be careful not to let lower performing keywords consume too much budget.

4. Obtaining sufficient visibility into search terms from the exploration campaign

Before a search term is added as an exact match keyword, there is no downstream visibility from the MMP. This can make it tough to assess the right tier for a search term to be added into. This challenge is not easily resolved, but can either be approached by either:

  • Creating a second exploration campaign of exact match keywords to measure downstream data before tiering the search term (which improves reporting visibility/structure but increases the need to move keywords).
  • Taking an educated guess at placing a search term into the right (which can affect reporting but reduce the need to move keywords).

What else can you do to improve campaign performance?

Some other opportunities to improve campaign performance include:

  • Exploring different bid levels above to see where your “clearing rate” is (your bid is only a ceiling, and the lower you bid the lower your scale).
  • Using ad group targeting settings (e.g. device) to adjust outcomes in ROI.
  • Using negative exact match keywords to control singular/plural search terms.
  • Breaking out more campaigns within low/medium/high for budget control.
  • Finding a better way to deal with keywords that have volatile volume or LTV.

Some keywords will make categorization by value difficult, due to the changes in auction performance. While the most straightforward definition of tier 1 is by LTV, as mentioned above, moving keywords can be detrimental to performance. In the case of keywords with volatile (but occasionally great performance) it may be beneficial to split these keywords into their own campaigns, with their own budget.

Categorize keywords by value in ASA

Structuring Apple Search Ads Account – Final thoughts

While this strategy of tiering keywords and campaigns in Apple Search Ads may seem a bit over-complicated at first blush, it is an evolution that can pay dividends by producing progressively higher ROI, especially as your campaigns scale, which ultimately enables you to bid even higher, and drive additional scale. Additionally, by going the extra mile of mastering the science of advanced segmentation and efficiency extraction, you will also learn a new frame of mind with which to expand to other areas of your marketing strategy that may also pay dividends, such as push notifications, other ad channels, and dynamic onboarding.

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