Dynamic Search Ad (DSA) campaigns are like a drug that marketers get addicted to.
These campaigns, which target the content of a website in a keyword-less format, first launched back in 2011. The main advantage of DSA campaigns lies in their ability to quickly scale query coverage for very large websites. Huge, long-tail sites in categories like real estate, travel, e-commerce, and classifieds leverage these campaigns to increase their advertising footprints across millions of pages.
At paid search industry events across the globe, 'experts' talking extol the virtues of DSA and how they were able to scale their accounts thanks to the campaign type. While these campaigns can deliver scale quickly, they ultimately hamstring the marketer through two root causes:
DSA headlines are not truly dynamic
DSA campaigns obscure query values
Google Makes Misleading Claims About DSA
The biggest drawback of DSA is the 'dynamically generated headline'. Experienced advertisers know that the headline is one of the most important factors driving click-through-rates and that active testing of it is vital to improving CTR.
Google cites in their Dynamic Search Ads support article that "headlines are dynamically added to be of greater relevance for each individual search." They go on to claim that they include "words from the customer's search phrase and the landing page in the ad."
I investigated both of these claims and was surprised by the results.
Google's Dynamically Generated Headlines are Not Truly Dynamic
First, as to the notion that the headlines added are of greater relevance for each individual search, this claim seems dubious. In one account, less than 5% of the ad headlines were actually unique, Google simply copied the h1 or meta title tag.
In the instances where it didn't directly copy the tag directly, the length of the h1 was the driving factor. When the h1 tag was fewer than 60 characters the 'dynamically' generated ad headline had a 99.55% chance of matching identically. When the h1 tag increased over 60 characters, the headline matched the tag just 2% of the time.
Google Deals with Long Headlines by Cutting off the End
Often times when the headline is shortened, Google simply chops words off the end giving the advertiser an odd looking headline. When ads were cut off for length, we observed 33% fewer conversions per impression. So much for a headline that is of greater relevance to the user! This was also a wakeup call that our SEO team was having a direct, negative impact on our SEM spend.
Google Does Not Insert Query into DSA Headlines
One of the best practices in paid search is to include the user's search in your ad headline and text. Large, well-structured accounts take advantage of this practice to drive high CTR. Unfortunately, this was not the case in the DSA campaigns I reviewed.
As to Google's second claim that they include words from the customer's search phrase in to the ad I found evidence of this occurring in a phrase match in just 4% of ads and 45% of total impressions. To be clear, this means that if a user searched "buy blue shoes" that somewhere in the ad headline the phrase "buy blue shoes" appeared. By leveraging the SEO title or h1 instead of the user's query paid marketers are left without one of their bigger levers and instead rely on the SEO a few cubes over who possibly hasn't changed title or h1 tags in months (if not years) leading to sub-optimal results.
Dynamic Search Ads Obscure Query Value
Lastly, if not hyper-segmented, DSA campaigns will bring in broad swaths of traffic to a single ad group. Because bidding is not done on a keyword level, most analytics platforms will only track what the campaign or ad group generates in terms of value per conversion. This means that the advertiser ends up bidding to an average and finds themselves unable to take advantage of high grossing terms.
The most sophisticated marketers are leveraging automation and segmentation to target ROAS down to the search query. An over-reliance on DSA campaigns takes away another advantage of mature marketers, understanding and ultimately acting on enhanced knowledge of user value.
It's Not All Gloom and Doom
When Google first pitched Dynamic Search Ads to its clients it was in the spirit that these campaigns should be used as a catch-all to capture the long-tail of search. They advocated that these campaigns should be bid lower than the rest of a well-structured account. Google reps also ensured that DSA campaigns would not cannibalize queries from other keywords in the account.
When utilized as a low-bid "gap filler," the way Google first intended, DSA campaigns can be extremely effective in uncovering new queries to be mined and added as proper keywords elsewhere. Once bids start to creep up and traffic to the campaign increases, however, inefficiency also creeps into the account.
Simply put, DSA's advantage is strictly in broadening the advertiser's search footprint on the long-tail. Relying on it to do anything more will only hamstring search accounts in the long-run and put advertisers at a disadvantage against more practiced competition.