You're listening to the “REI Marketing Nerds” podcast, the leading resource for real estate investors who want to dominate their market online. Dan Barrett is the founder of AdWords Nerds, a high-tech digital agency, focusing exclusively on helping real estate investors like you get more leads and deals online, outsmart your competition, and live a freer, more awesome life. And, now, your host, Dan Barrett.
Dan: All right, hello everybody, and welcome to this week's episode of the REI Marketing Nerds podcast. As always, this is Daniel Barrett, here from AdWordsNerds.com. I hope you are well. I hope you're having a wonderful week, and if you are listening to this, that means that it is this wonderful time, this wonderful time that I like to call Google changing everything and how it works time. [01:08.7]
This is the only constant in online marketing, change, and this is a good example of that because Google is changing up the way that keyword match types work inside Google Ads. This is a very important change and I want you to understand it, so I'm going to dive deep on this change with you this week, and we're going to talk about what it is and why you need to care about it.
All right, first things first. What is changing? Google is changing the way that phrase type keywords and modified broad match keywords work. And to understand this, we need to back up and think a little bit about what match types are, all right?
What I always say is that a keyword that you enter into Google Ads is not what the person is actually searching for. A keyword is a way of telling Google what you want and you can have different types of keywords all for the same search phrase. [02:12.8]
Now, let me kind of tell you what I mean. Let's say the keyword is “sell my house”, okay? That's the keyword. There are different ways we can enter that into Google and tell them what we want. We could, for example, use an exact match keyword of “sell my house”, which is basically telling Google, Google, I only want people typing in “sell my house”. They have to search for “sell my house”, nothing else, nothing extra, nothing in between. I just want “sell my house”, only people who type exactly that. That's an exact match keyword for “sell my house”. [02:48.7]
But we can also give Google a broad keyword for “sell my house” and a broad keyword for “sell my house” is, Hey, Google, I want people interested in the topic of “sell my house”. Yeah, when they type in “sell my house”, that, but also if they type in “Zillow” for “sell my wife's house” or “sell a house in New England” or “sell a house in Grand Theft Auto” or “sell a doll house”, or maybe even “buy a house”, really broad, broad matches like you give Google a concept and they run with it.
“Sell my house” is the keyword in both of these scenarios, but because we are using different match types, exact for when we just want exactly that, or broad if we just want a broad topic, we are going to get wildly different results when we use those keywords for our ads. This is why match types are so important to understand. They are so critical. Match types change the performance you get. [03:58.3]
Generally, the way you want to think about it is that the more focused and exact match type is, the higher the quality of click that you get from it, but the lower the volume of clicks that you get from it. Similarly, the broader you get and the more general you get, the lower the quality of the click, but the more of them that there are and generally the lower the cost. Okay?
That is the background on match types in Google Ads. If you want to learn more about that, I highly suggest you go check out my coaching program, which is called the Search.Click.Convert Bootcamp, which is all about running Google Ads for real estate investors. I'll put a link to that in the show notes for this episode, okay, or you can go to AdWordsNerds.com and find it.
All right, now, what is changed? Google is changing the way that phrase type and modified broad match work. The phrase type, just so you know, the way used to work is you would put the keyword in quotation marks, so “sell my house” in quotation marks, and we would basically say, Okay, Google, they have to type in “sell my house”, those words in that order, but you can add anything you want to the beginning or add anything you want to the end and that'll be fun. So, “sell my house”, but also “sell my house fast” or “I want to sell my house”, all that is fine with phrase match. Okay? [05:17.0]
Modified broad match was, okay, I'm going to type in “sell my house”. They have to type in “sell”. They have to type in “my”. They have to type in “house”. But they can add anything they want at the beginning or in the middle, or at the end, or they can rearrange the order, so they could type in “sell my house” or “my sell house” or “house sell my”, or they could type in “sell my old house” or “sell my house in foreclosure”, or “I want to sell my wife's house in Albuquerque”. Okay?
Modified broad match a little bit broad, not as broad as all the way broad match. Phrase match, it's a little bit exact, not all the ways exact as exact match. And mixing and matching these match types is how we would control who is seeing your ads and what kind of quality of traffic we're getting, and how much we want to pay for them and yada, yada, yada. [06:04.5]
Google is changing how this works. Remember that phrase match used to mean you can add anything you want to the keyword at the beginning or at the end, but you have to keep these words in this order and put nothing in the middle. That was what phrase match was all about. Now phrase match is going to allow for some words to go in between the words.
For example, the example that actually Google gives us is let's say the phrase match keyword is “long sleeved dress” and before it would be you can type in anything before “long sleeved dress” and anything after “long sleeved dress”, but they've got to say “long sleeved dress” and nothing in the middle.
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Now, what they're saying is when the search term fits, and these are Google’s words, right, the intent, you can put words in the middle. Their example is, for long sleeved dress, something that will now trigger that keyword is long sleeved lace dress. They are putting a word in the middle of that used to be what modified broad match was for. Now they're saying, basically, if these words are in the same order, you can put words in between them as long as it makes sense. I'm doing air quotes. You can't see me. I'm doing air quotes. [08:00.0]
Now, what does this mean for real estate investors? Generally, what it means is you have less control now. You have less control over who Google shows your ads to. They have taken away a degree of granularity in how we are targeting keywords to searches and there is a very specific reason that they have done this.
They have done this because they want you to use their automated systems. They want you to trust the Google AI, the Google machine learning systems to target your ads for you. They basically want you to give them a bunch of stuff and they'll figure it out. This is one of many tiny moves in that direction, essentially making Google ads far more algorithmic, far more like Facebook ads are. [08:57.2]
Here's the problem in that, because really, in and of itself, that is neither good nor bad, but here's why I think this is bad for real estate investors specifically. It’s because in every single instance, every single piece of data I have generated that we've generated at AdWords Nerds, hundreds of real estate investors across the country, probably thousands at this point, the problem that we have seen is that Google clearly does not understand what a motivated seller actually is. They do not know the difference between retail and motivated leads. They do not seem to really understand the business model of real estate investors.
And, look, I don't blame them. They're Google. They're not real estate investors, right? That's not the most uncommon thing. But the problem is when we have tested any system where we give Google lots of leeway to match our clients to leads, they do a terrible job. It is objectively really bad. The close rate is very low. The conversion rate is very low. The cost per deal acquisition is high. I have never seen a case yet, as of this recording never seen a case where for the average investor, Google's automated tools actually outperform a human manager. [10:14.0]
Look, you can take that with a grain of salt. Clearly, I run a marketing agency. I've managed human managers. I have a dog in the race. Don't take my word for it. If you want, test it in your own campaigns. I think what you will find is that Google consistently underperforms the management that you would have done, and there's a very clear reason for this, at least to my mind. The reason is that in most markets motivated sellers are relatively few in number.
If you compare the size of the motivated seller market to the retail real estate market, it is a fraction of a fraction of a fraction. Everybody knows this. If you think about direct mail, right, your mailing list for people that might be motivated sellers is a lot smaller than the list of people who might want to sell their house on the MLS. It's a fraction of a fraction. [11:05.7]
And what do we know about artificial intelligence and machine learning and all that stuff? It does best with gigantic bodies of data, because the whole way it works is spotting patterns in the noise. When you have a relatively small sample size, which most investors in most markets with most average budgets do, it never gets enough data to really understand what's happening and you never quite get the benefit from automated bidding strategies that you would get, for example, if you were using an e-commerce store selling thousands and thousands of things a month. It just doesn't happen.
And I’m not saying it will never happen and, in fact, generally I am bullish on the role of artificial intelligence and machine learning in our industry in general. Generally, I think, yes, there's a lot of space to do this and there's really going to be exciting things happening over the next five to 10 years, but for right now, it isn't the case that this stuff outperforms a human. It just isn't the case. [12:10.0]
And when Google removes control from you, the investor, you, the advertiser, and they say, Just trust us, but they don't have an option that actually gets you deals at a profitable rate they are sabotaging your success. So, the question becomes what do we do about it?
I will tell you what we are doing about it at AdWords Nerds. What we are doing about it is we are diving way deeper into metrics of quality than we ever have. We are doing our own tracking at the lead level. Every single lead that comes in, we put it in a spreadsheet, we associate it with a very specific keyword and we track it across all of our clients, the performance of that keyword in terms of cost per deals acquired over time. [12:55.0]
We are building our own dataset of all the investors that we work with nationally and feeding that into Google BigQuery and other machine learning platforms to figure out, hey, if all we do is focus on real estate investors, what can we learn that nobody else can? We are very closely communicating with clients in order to figure out, hey, are you closing? Hey, what's your ROI? Hey, how is this lead? We are shortening that feedback loop in order to figure out what we do that works and we are not trusting Google to tell us what is working and what isn't.
We are tracking in our own accounts how our keyword usage is different, how our search terms report is either higher or lower in volume than before. We are doing all this because, in general, though I love Google and I have dedicated much of my professional life to learning Google systems and using Google to get deals for my clients, I do not trust them. I do not trust them with my business and I don't trust them with your business. [13:55.5]
It's not to say that I won't use them, right? It's kind of like a Ron Reagan “trust, but verify” type of situation. Okay? I will use Google conversion tracking. I will use Google Ads. I love Google Ads. We do a ton of this for clients. Every single day, we get deals for clients across the country using Google Ads. I'm not saying let's pan it.
But what I am saying is know your numbers. Watch your KPIs. Track what's happening in your account and be aware. Hey, and just by listening to this podcast, you will be aware of most of what's happening because, hey, something affects us or affects real estate investors in online marketing, I will be here to tell you about it.
I can't tell you how much I appreciate you listening to this episode, and if you have any questions, you should come over to our Facebook group. I'll be answering questions about this stuff literally every week in there. It's at an AdWordsNerds.com/Group. You can go there, request to join. It's free, and I’m in there every single week, posting content and answering questions and all sorts of fun stuff. Once again, that's the REI Marketing Nerds Facebook group. You can get there by going to AdWordsNerds.com/Group or just go on Facebook and type in “REI Marketing Nerds”. [15:03.4]
I really appreciate you being here. I will see you next time. Cheers.
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