Competitor analysis in contextual advertising

Researching the competitive environment is an integral part of any marketing campaign, and contextual advertising is no exception. The emergence of a strong competitor will cause significant difficulties. In particular, a decrease in audience reach and an increase in the price per click.

In recent years, competition in contextual advertising has intensified. That is why it is important to understand that analyzing competitors in contextual advertising is a necessity that cannot be ignored.

How is analyzing a competitor’s contextual advertising useful?

Analysis of a competitor’s contextual advertising allows you to identify important elements of advertising campaigns:

• What and how competitors advertise, how often ad settings are adjusted, what strategies they use;
• What calls to action are they based on, how do they attract users?
• Do they use extensions and add-ons for ads, and if so, which ones?
• What ideas can be adapted for your advertising campaign?
• How much do other companies spend on advertising, approximately?

What should be considered when analyzing competitors’ advertising campaigns?

Benchmarking is now an important modern tool for improving efficiency in any business. When analyzing competitors’ advertising campaigns in search of the best techniques and methods for contextual advertising, the following points should be taken into account:

1. Key phrases. This is what contextual advertising and impressions are based on. Using queries from successful advertising campaigns of competitors instead of searching for them manually is much more convenient and often more effective.
2. Headlines and ad texts. The positioning of a business and product in contextual advertising is largely achieved through headlines and text. Studying these elements in competitors’ advertising campaigns and their unique selling propositions helps to find ideas that can be improved upon to create your own style. Other advertisers’ ads can be found manually or using services;
   
3. Completeness of ads. Pay attention to whether your competitors use extensions and add-ons, whether contact details are filled in, whether dynamic advertising campaigns and additional links are used. Everything that others have neglected can become your advantage;
   
4. Ad history. When monitoring competitors, it is useful to study their ad history. How often they experiment and whether they revert to old versions will help you understand what works and what doesn’t without compromising your own advertising campaign.
5. Landing pages. Landing pages are the first thing a user sees when clicking on a link from a search engine. Analyze your competitors’ landing pages for completeness, relevance, presentation of information, and design. If they provide users with links to general pages, do better—create different landing pages for each relevant query.

How can you find out your competitors’ budgets?

Since many different factors influence pricing in contextual advertising, it is impossible to find out the exact budget of competitors in Google Ads. However, this does not preclude the possibility of determining the approximate costs of competing companies. Knowing how much they pay per click, you can compare this indicator with your own and understand which display strategy is more appropriate to use—focusing on high-frequency queries that are expensive, or cheap low-frequency ones.

You can calculate a competitor’s budget when auditing specific keywords as follows:

• Create an Excel sheet and add all the necessary competitor keywords;
• Sort data by number of impressions, cost, and position;
• Identify the number of clicks for each keyword;
• To determine the approximate CTR (click-through rate) of a competitor, compare it with the CTR of your advertising campaign for the same queries. If you ranked higher for these keywords, reduce the indicators for the competing company slightly, and vice versa.
• Based on the click-through rate found using a simple formula in Excel, we calculate the number of clicks:

Clicks = Impressions * CTR

• Next, we find the budget for this keyword by multiplying the number of clicks received by the cost per click.
• We summarize the data and obtain the total budget that another website spends on the analyzed keywords.

Competitor analysis in Google Ads

After launching an advertising campaign, Google AdWords gives advertisers the opportunity to obtain information about who is competing with you for a specific query, whether you are ahead of your competitors or lagging behind. To do this, use the special “Auction Statistics” report.

With this Google Adwords competitor analysis report, you will enjoy the following benefits:

• A list of websites that are also displayed for a specific query or group of queries;
• Percentage of impressions received — determines the share of impressions that were received during a specific period of time for your campaign and competitors;
• The average position of your ads in search results compared to other sites;
• Overlap rate — how often your ads appeared in the same search results as your competitors;
• Win rate — shows how often your ad ranked higher than others;
• The next position coefficient shows how often a competitor’s ad ranks higher than yours in a single search result.
• The ratio of ads displayed above search results shows how often your ad or another advertiser’s ad was displayed above search results, meaning that the algorithm considered it more relevant to the query.

Competitor audit in our projects

Analyzing competitors in advertising results will allow you to “keep your finger on the pulse” and monitor the behavior of other advertisers. Understand what tools they use, for what purposes, and evaluate the results they achieve.

In our reports and recommendations, we outline the strengths of the Republic of Kazakhstan, advertising strategies, and competitors’ websites, offering our clients ideas that can be implemented to achieve maximum results right now.

Examples of competitors’ ad texts and USPs (unique selling propositions) they use: