Ever wonder why keyword research is so hard? Keywords are arguably the most important part of a paid search campaign, so there are tons of tools available that should make keyword research easy.

But here’s the thing, while you can use these tools to do things like estimate search volume, predict cost-per-click or even spy on the keywords and ads of your competition, you can use all of these tools and still end up with frustratingly ineffective keywords!

What’s the problem?

As it turns out, this keyword conundrum isn’t just a “personal problem.” After auditing over 2,000 AdWords accounts at Disruptive, we’ve discovered that in the average AdWords account, less than 6% of the keywords produce all of the conversions.

Converting vs. non-converting keywords

That means 19 out of every 20 keywords are a waste of money.

As scary as this statistic is, though, you should take this as good news. Since everyone is wasting money on the wrong keywords, if you can pick the right keywords, you’ll have a huge advantage over the competition.

And guess what? This article will show you how to do just that. Let’s dive in.

Step 1. Double-Check Your Conversion Tracking

Before we start looking at how to identify, test and refine your keywords, we need to talk about conversion tracking.

If you’ve been around in paid search for a while, you know how important conversion tracking is. After all, if you can’t connect your ad spend to something more concrete than impressions or clicks, how do you know if your campaigns are really driving value for your business?

However, you can’t just set up a conversion pixel on your “thank you” page and call it good. You have to track all of your conversion actions. That means calls, sales, chats, email sign-ups—if it matters to your business, you need to track it!

Unfortunately, while thought leaders on PPC Hero and across the web have harped on this point for years, 42% of AdWords accounts still haven’t tracked a single conversion (data from those 2,000+ AdWords audits I mentioned earlier).

Of the 58% of accounts that are at least tracking something, only half are actually tracking all their relevant conversions.

Conversion tracking breakdown

To put it simply, that means only 29% of AdWords advertisers actually know what’s happening in their account.

So, if your AdWords account is part of that 71% of accounts without effective conversion tracking, your first order of business is to get your conversion tracking working properly (for specifics on how to do this, check out this excellent article).

Since we’re on PPC Hero, though, I’m going to assume that this is all old news for you and show you how to use that conversion data to build a truly effective keyword list.

Step 2. Do Some Keyword Research

At this point, you need to do some by-the-book keyword research. I’ll mention a few tips and tricks here, but if you’ve already got a pretty robust set of keywords in place, feel free to skip this section and head down to step 3.

Using Keyword Research Tools

As I mentioned earlier, there are a number of handy tools you can use to flesh out your existing list. For example, just to mention a few, you can try:

Each of these tools can give you a ton of potential keywords, but as you uncover all those new keyword ideas, it’s important to remember that the goal here isn’t to…

Don't just target all the keywords

The goal is to target the right keywords.

With that in mind, ask yourself the following as you consider each new keyword candidate:

  1. Does this keyword have meaningful search volume?
  2. How relevant is this keyword to my business? Is this a keyword people will actually use to find my product/offer or is this just a keyword I associate with my business?
  3. Is this keyword relevant to my audience’s pain points in some way?

If you can’t answer all these questions with a “yes”, think long and hard before you add that keyword to your list. Odds are, it’s probably going to end up in that “useless keywords” category.

Step 3. Determine Your Winners

Once you have your list of keyword candidates, it’s time to test. Put together some high-quality ads and landing pages and let things run for 8-12 weeks.

Ideally, if you’re bidding on the right keywords, your ads are showing up in front of people who are looking for what you’re selling. Hopefully, they resonate with your ad copy, click on your ad, visit your landing page, and convert.

At least, that’s how it’s supposed to work.

The problem is, 94% of your keywords are wrong. When you’re bidding on the wrong keywords, your ads show up in front of people who aren’t looking for what you’re selling. Unfortunately, while they still might click on your ad, they’re not going to convert.

Identifying Your Wasteful Keywords

With that logic in hand, let’s start our keyword analysis by looking at your Search Terms report. Open your paid search account, go to your Keywords tab and click “Search Terms.”

From there, add a filter for “Conversions < 1”:

Review your search terms

If you look at the last 2-3 months of data in your account, this should give you a really good picture of which search terms are a waste of money.

To see just how much you’re spending on non-converting search terms, scroll down to the bottom of the page. Divide the cost of your filtered terms by your total ad spend to see what percentage of your budget is paying for useless clicks.

Don’t be surprised if this number is surprisingly high. The average AdWords account (and this is pulling from accounts with effective tracking) wastes 76% of its budget on search terms that never convert.

To give you a feel for what this looks like, here’s a snapshot of some of the accounts in our study:

Productive vs. wasted spend

Clearly, the ratio between wasted spend and productive spend is not very good for most companies.

If you run the same report for your keywords, you can quickly identify which keywords are contributing and which ones are a waste of space. However, it’s best to look at both your keywords and your search terms because often a keyword may get conversions from some search terms and be a budget black hole for other queries.

Step 4. Eliminate The Losers

Fortunately, now that you know about this problem, you can fix things using the following 4-step process:

1. Purge Your Keywords

Filter your Keywords report for keywords with no conversions in the last 2-3 months and get rid of most-to-all of them. If a keyword hasn’t produced conversions in the last 3 months, it’s not likely to produce them in the next 3 months.

2. Review Your Worst-Performing Search Terms

Next, filter your Search Terms report for search terms with an unacceptable conversion rate (I like “Conversions < 1” or “Conversion rate < 2%”) and sort by cost. Add the top 10-20% of conversion-less search terms with the highest cost as negative keywords.

3. Identify Search Term Trends

At this point, it’s time to do a little sleuthing. Take a look at your poorly-converting search terms report and look for trends, such as:

  • Similarities between search terms (eg, lots of location-specific queries for a non-local business campaign)
  • Large numbers of unrelated search terms all tied to the same keyword (individually, these search terms may not get a lot of impressions or clicks, but together, they can represent a major problem)
  • Poorly-converting search terms that all point clicks to the same landing page (especially if those search terms seem to be relevant to your business)

Depending on the exact situation, you may want to get rid of certain keywords, add negative keywords, or make changes to ads or landing pages.

4. Retest And Repeat

The last step is to let your newly optimized keyword strategy run for a while and then reevaluate your new data. It may take a few cycles to really get things dialed in, but the results will be worth it.

Just to give you a feel for how this works in practice, here’s what we see when we run client accounts through this process:

Process results

The less you spend on the wrong keywords and search terms, the more effective your campaigns are—shocker, right?

As a result, you’ll spend less and drive more conversions.

And, the more times you repeat the cycle, the further ahead of your competition you’ll get. After all, most businesses try to improve their campaigns by adding keywords—you’ll be focusing your campaigns on the keywords that actually work.


Keywords are the secret to paid search success. Unfortunately, most paid search advertisers approach keywords the wrong way which—now that you’ve read this article—gives you a huge advantage.

Put together a results-focused keyword strategy and you’ll be well on your way to dominating the competition!

You’ve heard my two cents, now I want to hear yours.

What do you think of this approach? Did these statistics surprise you? How do you optimize your keyword strategy?