Internationally acclaimed speakersPrestigious award showDrinks & Bites11th edition

Frederick Vallaeys: ‘We will have self-propelled cars before self-managing ppc accounts’

30 January 2019

Frederick Vallaeys was one the first 500 employees at Google where he spent 10 years building AdWords and teaching advertisers how to get the most out of it as a Google AdWords evangelist. He started his own Agency which he solded to SalesX and is still in the board of directors. Nowadays Frederick is CEO and Co-founder of Optmyzr. A tool well known within our industry. Frederick has been named 2nd most influential PPC expert of 2018 by PPC Hero and I got the chance to interview him before his session at Friends of Search in Amsterdam on February 6th.

What is the biggest challenge for Optmyzr the upcoming year?
One of the main challenges we see is that Agencies and PPC experts really want to automate to be more efficient. But the biggest question that they often haven’t really answered is their own internal process. The capabilities of Google Ads are changing, new tools come into the picture, the way you do optimization maybe shifts because of the way Google is changing. A constant struggle is figuring out a few things: What do we do, how often do we do it and in what sequence do we do it?. This is really a process type of question. At Optimyzr we’re working quite extensively on giving guidance to agencies what we think is a best practice and the right way to do things and also placing tools in place to facilitate that. Because to this point we did a great job to make it very easy to do for example bid management or query management. But our customers don’t always know how to put those pieces together into an overall strategy.

Do you think users are able to put in the right data to make the right optimizations?
That’s a good question, that’s a shift in the industry. The data that we historically used for optimizations has all been inside of Google Ads. But now people start to realize that there is more data that you can bring in because it’s a machine and the more business data you can give to the machine the better machine will do to make it work for your business and not just based on averages. So this is becoming the next challenge. This is something agencies are thinking about and we actually make it quite easy in the tools to upload it the in the tool but the question is how to use it. I went to Google IO and one of the key things was ML and AI and it blew my mind that everyone is talking about it that they want it but nobody understands the power of it and what type of questions you can ask and what sort of data you should bring in to answer those questions. So there is this holy grail but no-one can climb the mountain to get there. It’s an industry buzzword.

Automation should have an important role in our services, what is your view on the current state and embracement of automation within agencies and your clients?
I think there are different levels of automation and it’s becoming more and more widely adopted. Most successful agencies, and agencies that are doing this for a while, understand the need to automate. It’s basically a question of scale, the more automation u use the more clients you can manage with the same staff so it will make you more profitable at the end. I still see some people who hesitate to automate because they believe they can ultimately do it better than the tool or machine. This is often still true but it’s about how the human is leveraging the machine. You can’t just hand off all the work to the machine and be done with it. It’s really about how you get the most tedious an boring and mathematically involved work, how do you get this in the machine. But then you still need to teach the machine things that it doesn’t know about your business so that it still can become better. Then there is also a bit of a struggle with people looking at Google. Google isn’t saying much about where the human managers fit into the equation. Is Google trying to put us out of a job? There aren’t saying this and I don’t think so. A great example is with smart campaigns like smart shopping campaigns of any other option that could help your client. You as an agency have done this before and you know what the best option is and this is the starting point for a new customers. What people often forget is that you can only turn on a smart campaign after you build a manual campaign with enough data. There is a transition point where you can hand it off but if you hand it off you should still be the pilot in that cockpit because something at some point is going wrong and if you don’t see it or fix it, it’s going to cost your client.

At this point the basic stuff is being automated like bid- and budget management. I see agencies that are doing some very cool stuff with technology but it ends up being that the coolest stuff is done by this technology but it isn’t really automated. Off course they could do something that they couldn’t do before because the technology didn’t exists but it’s build for a specific client which has the budget to let humans figure out what the strategy should be and build out the technology to implement that solution but it isn’t scalable. A lot of automation that we see are more basic like budgets, bids, ad text and query management. So stuff very obvious that can be done by a machine. But also then we see that agencies like a level of oversight. Because even if you say that you can find good queries and add them to your accounts there are things you understand about your customer or if some query contains a competitor brand. This final level of human review are needed by agencies because if you make one mistake with a client, this is what they will focus on.

Where do you think PPC will be in 5 years?
That’s a great question and a really long timeframe. If we change the question to “How much automation is there going to be and what is the human role?” Then I would like to compare it to the self-driving cars. I have the feeling that we will have self-driving cars way before we have self-driving PPC accounts and I think the difference is that PPC is competitive and adding humans to the mix gives account the edge where in self driving cars everyone benefits because everyone is in a self-driving car. In PPC there is always someone who says that he has to add more humans in conjunction with the machine to push results. The only response you have to give as an agency is to do the same thing, otherwise you won’t be competitive anymore. So we are going to see some really major enhancements in Machine Learning and agencies will be able to take in clients that they weren’t able to manage in the past because they were not profitable. But with good ML you can manage some clients for a very low fee and deliver good results. The value is not the act of management but knowing how to use the technology with client data.

Large clients would like to put your time in different things and not decreasing fees. Every agencies sees that clients try to get a lower fee. From client perspective logical because you have more tools and you should be doing the same things faster. But we as agencies have to paint the picture and show the client that if you focus on different tasks you are able to drive more value. The initial reaction of a client is a lower fee but good agencies are able to spin that and say that they could do that but then the client will fall behind competitors and the agencies should focus on different things.

What is your preffered management tool? And obviously, you can’t mention Optmyzr.
I was on the team that build the AdWords Editor. So I will say that’s my number 2 tool. Here’s the thing: a lot of people don’t use Optmyzr. Optmyzr isn’t a tool that will manage every portion. We decided to focus on things that experts want to do but it’s to hard in the Ads interface. The ads interface is really good, the adwords editor is really good but they are built for millions of advertisers. There are things we would like to do as experts like Alpha Beta structures, Single keyword adgroups, measure close variants very closely and that stuff Google doesn’t want all advertisers to do. Agencies are fine but not all clients. So they won’t build this in their tooling. So, what’s the best tool? There is not one tool that’s the best but you should place a suite of tools in place to be able to achieve what you want to achieve.

What gets you out of bed in the morning?
The fact that I have been doing doing PPC since 1998 in some form or another. A really really long time and I’m still not bored! Just every month there are changes from Google Ads and keeps it exciting. Now we just got Responsive Search Ads, how does this change how we thing about ad text optimization? And I’m fortunate running a tool company that I’m able to actually sit down and think about these bigger questions. I don’t get called by clients that have things on fire. That’s what gets me out of bed, figuring out where the industry is going, what should people be doing where do we success in what they are doing and how do we turn this into something that is scalable to make it available for more people to use and utilize.

What is your best case of the past year? And why?
I can’t talk about specific clients but my favorite case is that I see certain clients leveraging the rule engine that we have by bringing in their own custom data and bring this to Google Ads and then building their own logic around this. Often times we see that in the form of aggregation. So as people are getting more and more specific in how they manage AdWords say like SKAG or the GRIP structure in Shopping everything gets so tiny that it gets difficult to make the good decision. So we see very interesting ways how people use our tool that they can roll up the data so they can make specific decisions on something very granular when there is enough data but they can also easily fall back on more generic components if needed.

What is your message to people within PPC for the upcoming year?
One of the main messages is that we’re at this inflection point of Machine Learning and the pace of innovation and improvement is going to be very very rapid. So do not take it easy and do not assume that humans will still remain better at certain tasks. Be ready to shift your business when the ML gets so good that you will have hard times to charge for that same thing. Ultimately there are a lot of roles humans can play but you have to be mentally ready to make this shift. It can be this year or next year but sooner than people realize!

You mentioned ML already but what is going to be the biggest change within our business in 2019?
Machine learning indeed is a broad concept and what does it actually mean? So, I think it means that as we work on Google Ads we should think more about our business data than the Google ads data and ads levers. How can we teach the machine and optimize results? This is a fundamental shift. In the past we controlled the machine with bids for instance but now it should be about which trends can we leverage to teach the machine.

If we look at the past year, where didn’t businesses pay enough attention to and therefore didn’t reach the maximum results?
I’m a huge proponent of Google Ads scripts and I still see a very low adoption of them the way that I loved for it to be used. I’ve long said: when you buy a tool it tense to be somewhat cookie cutter because thats the only way that tool companies make money. They build one tool that can be used by many many customers. These tools off course have customizations but why I like scripts so much is that you can take, for instance, my script and you can completely customize it to your needs. Not just 5 settings that I give you but you literally have the code and you can change anything you want. I don’t see enough of that. Everybody knows that if you hire an agency that your consultant needs to sleep. Everyone needs to sleep. But the machines can give us a heads-up if there is something that needs to be aware of or pay attention to.

Which “secret” do you want to share with our audience up front to be more successful?
The secret is a little bit broad maybe but I’ll say: You can use Google Ads script to regain control on Google Ads the way you would like it to be. So one of the challenges we all have as PPC experts is that we have a proven methodology for managing Google Ads and then Google comes in and they changes how budgets work, ads work, matching works. That’s annoying because we build a methodology and now we have to change it overnight. The secret is that you can use Google Ads script to undo the change from Google to buy yourself some time to figure out how this new thing works and how you should be using it to get the most out of it and then put it into practice. Some of these scripts literally take 30 lines to undo a change from Google. It’s important, in some cases, to change you methodology. You can take the budget spend to 200%. It’s a good change to get the most out of your budgets because the shift in volumes and conversions. The key thing is: the change happens on your schedule, not on Google’s schedule and you have time to explain to your clients what it will mean to them. It’s important to go with the changes of Google because things change rapidly and your script won’t be working anymore on a certain day.

Why should no one miss your presentation at Friends of Search?
Because we are going to spend 25 minutes together and in those 25 minutes I will give you enough Google Ads script that will save you hours and hours every month. So it is the highest Return on Ad Spend session that you can attend.

Frederick will speak at Friend of Search on February 6. Get your tickets here.