The term “the long tail” was first coined by Chris Anderson in 2004 in a Wired magazine article. The long tail, as it relates to keyword advertising, describes a large list of keywords which, individually, might only generate one or two clicks each and every month. In the aggregate, however, long tail keywords in a PPC campaign can account for thousands of clicks.

The idea, which has become the conventional wisdom in PPC campaigns, is that if I include specific or obscure keywords that relate to my business I can pay a cheap price for clicks. And if I have a big enough list of these keywords I can generate enough business to justify having them.

Flawed Strategy

This is a case where the conventional wisdom is wrong and results in a flawed strategy. Many advertisers have thousands of keywords that only get a click or two per month, but on average they need anywhere from 20 to 100 clicks just to generate one sale. Therefore, in many cases, an advertiser needs to wait several months or even years for a long tail keyword to produce just one sale. This is the equivalent of owning a brick and mortar store and having a product sit on a shelf for a very long time.

Do you really want to wait that long for the product to get sold or are you better off cutting your losses and stocking a more profitable product?

Our Recommendation: Focus on the “Short Tail”

We’ve worked with advertisers that have tied up thousands of dollars in their long tail keywords every month. We don’t recommend that they completely abandon those keywords. Instead we recommend breaking their long tail keywords into a separate campaign with a finite budget and re-purposing their ad budget towards high performance keywords.

This accomplishes two things:

1. it allows more of your budget to be allocated to better selling keywords, which will make you more profitable.
2. it allows you to monitor your long tail keywords in case new opportunities emerge.

If you’re an advertiser with an unlimited budget, you probably won’t be concerned with the dangers of the long tail because your only options are to invest and wait or not advertise at all. But for most advertisers, the sky is not the limit and tough, hard allocation decisions need to be made relative to spending scarce capital and limited budgets. And that means re-focusing your campaigns on the “short tail”.

This entry was posted on Tuesday, February 27th, 2007 at 12:59 am and is filed under All Blogs, PPC. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.