Pay-per-click activities can help boost brand awareness, generate leads, and drive traffic. But PPC marketing can be tough to get right, especially with so many competitors vying for the same audience.
That’s why competitive analysis is so important. It will help you to understand the tactics your competitors are using and learn more about their Google Ads strategies.
There are six key steps involved in an effective PPC competitive analysis:
- Identify your competitors
- Analyze their PPC strategy
- Analyze their ad copy and landing pages
- Identify their target audience
- Analyze their budget and ad spend
- Analyze their performance and ROI
Let's dive in and see how to do competitive analysis in PPC.
Step 1: Identify Your Competitors
With any competitive analysis, the first place to start is to know who your competitors are!
Even if you’re an established company with detailed information on your competition, don’t ignore this step. There are always new companies moving into an industry or expanding that could now be a competitor.
Use in-house knowledge to identify competitors (your sales and marketing teams will be aware of who is out there), but there are also some great tools to help.
SEMRush enables you to conduct ad research while Google Ads Auction Insights (see below) helps you measure your ad, bidding strategy, and campaign performance against your competitors.
Step 2: Analyze Their PPC Strategy
Once you know who you’re competing against, you can analyze their PPC strategy. You should also look at how advertisers combine SEO and PPC strategies to cover both organic and paid channels. Here are some effective ways to do that.
Keyword Research
If you’ve already done a competitive analysis for SEO, it should be easy to know what keywords your competitors rank for.
But it’s worth doing the same exercise for PPC as there may be terms or phrases you could miss out on for paid advertising.
Use tools like SEMRush’s Keyword Gap tool to see which keywords your competitors are bidding on.
It’s worth looking at volume and CPC to see how cost-effective a keyword is. This will help you to identify potential gaps in your keyword strategy.
Ad Placement Analysis
Look at where your competitors' ads are being displayed. Are they primarily appearing on search engine results pages (SERPs), on specific websites, or on social media channels such as YouTube?
Analyze this information to identify potential placements for your ads and be willing to experiment to see the performance of your content. You can use Similarweb to do this.
Monitor their Search Results
Use paid or free tools like the ones we’ve already mentioned to get an idea of your competitor’s search engine ranking, the ad copy they used, and ad spend. This will help inform your bidding strategy and ad copy.
Use Ad Intelligence Tools
Ad Intelligence tools like Spyfu allow you to see the historical performance of your competitors’ ad campaigns. This includes their ad spend, click-through rates, and conversion rates.
These insights will give you an idea of what is working well for them so you can see if it’s worth replicating.
Step 3: Analyze Their Ad Copy and Landing Pages
Content plays an important role in engagement and conversion. If you’re not tailoring ad copy or landing page content to the interests and needs of your audience, then they’re not likely to click or stay around for long.
Ad Copy Analysis
A great way to help you improve copy performance is to look at what your competitors are doing. How are they positioning their products or service and what do they promote as their unique selling points?
To do this, ask yourself:
- Are they using particular keywords in ad copy?
- What is the tone of the content or approach, e.g. formal, friendly, humorous?
- What imagery or video content are they using to drive clicks?
- What type of CTAs are they using?
- Do the colors used in ads tie in with their brand?
Read: ‘8 Tips for Content Optimization for Every Social Media Platform’ to get some ideas for your social media ads.
Landing Page Analysis
A good landing page can do wonders for your conversion rate. The content needs to be laid out well, speak to your audience, and include a powerful CTA to drive click-through.
You should also make sure that your landing page copy matches their point of origin. For example, if someone clicks on a Facebook ad, does the landing page match what the visitor thought they would read about? Does it align with the messaging and look of the Facebook ad?
Google’s auction report can help you find your competitors’ top-performing landing pages. So make a list and take a look. What’s working well and why? What could you do better or take inspiration from?
Think about conversion rate optimization here so you’re doing your best to turn prospects into leads or customers.
Step 4: Identify their Target Audience
Understanding the target audience of your rivals will help you to see if you’re on the right track with your PPC targeting or if there are buyer personas you’re missing out on.
It’s time to do some research. Look at who your competitors are targeting with their PPC strategy. What channels are they using? If it’s B2B, what job roles or levels of seniority are they looking at? If it’s B2C, is there a particular age group or gender profile?
You can use resources to help identify target audiences such as SimilarWeb, AHREFs, or Google Ads Keyword Planner.
Step 5: Analyze their Budget and Advertising Spend
As it becomes harder to bid for keywords and marketing budgets become tighter, it’s important to get the most from your PPC campaigns.
Look to your competitors to see what their budgets are and when they are allocating their money and resources. You can do this by:
- Using ad intelligence tools (e.g. Spyfu, or AdGooroo)
- Analyze search engine rankings
- Monitor competitor ads and how often they appear
- Look at their online presence including social media
- Network with industry players and learn more about budget spends
These tactics will help you to understand your industry better and see what’s working for your competitors in audience engagement.
Step 6: Analyze their Performance and ROI
It’s important to understand the performance and ROI of your competitors for PPC activity.
The best way to do this is to analyze industries or standard benchmarks for your industry. This example from Wordstream on Google ads and Microsoft ads in 2022 gives you a great place to start and set KPIs for your campaigns that are realistic and achievable.
The metrics you should understand and track are average positions, cost per click, cost per lead, CTR, impression share, cost per acquisition, and conversion rate.
Be aware that it can take time to get your PPC campaigns right, so be willing to analyze, tweak and test.
Learn how to analyze competitor’s PPC campaigns
It’s important to conduct a regular competitive analysis for your PPC to stay ahead of the competition. DMI’s short PPC course will cover paid search fundamentals, PPC campaigns, reporting, and GA4, and much more. Save your spot today!
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