To run ads on search engines like Google, you place bids for your ad to display in particular search queries. In other words, you compete with other advertisers for a keyword. But did you know that you can also compete against yourself without knowing it? It’s called keyword cannibalization.
Before your ad competes with others in an automated keyword auction, an internal auction between your own keywords/relevant keywords takes place within your Google ads account. Google search needs to know how your ads rank among each other before it can rank them among ads by other businesses targeting the same keyword.
Because we live in an age of infobesity, where everyone overloads the amount of information on the web in an attempt to rank on top, it’s easy to fall victim to keyword cannibalization without realizing it. To help you avoid it, this article will go over what exactly keyword cannibalization is in pay-per-click (PPC) advertising, why it’s bad, its 3 different types, and steps you can take to avoid it.
In PPC advertising, keyword cannibalization refers to when you have two or more campaigns targeting the same search query in search results/pages ranking. In other words, you have multiple ads competing for the same keyword or two or more pages. It’s considered “cannibalization” because it’s as if you are taking a “bite” out of your own ad margins and results.
Search engines like Google search/ search engine results page automatically show the ad they deem most relevant based on its ad rank. Typically, ad rank is calculated by multiplying the maximum cost-per-click (CPC) bid with the ad quality score (ad rank = max CPC bid x quality score). When you have two or more separate ads competing for the same keyword, it splits your results. Your click-through rates (CTRs), links, and content are split across multiple ads.
Of course, it’s only keyword cannibalization if the intent behind the multiple pages/multiple ads is the same—to direct leads to a particular landing page etc. If you run different ads that share a keyword but have different goals, this is not keyword cannibalization (though you might consider consolidating your ad campaign goals).
Keyword cannibalization is nearly always unintentional. Essentially, you’re asking the ad platform’s algorithms to rank your competing ads. Often, one ad has higher ranking signals than another and will win the ad space. However, if there is no clear winner, none of the ads will rank as well as they might have, ruining each other’s ability to perform.
Keyword cannibalization cripples your PPC campaign. As your ads compete for the same keyword, the flow of traffic generated by them is broken. An ad might match for a keyword one week and not another, and you may see dramatic fluctuations in traffic. More importantly, keyword cannibalization leads to rising CPC costs, decreasing conversions, and diminishing page authority. Basically, it causes you to serve worse ads at a higher cost.
There are 3 types of keyword cannibalization in PPC: keyword overlap, geographic overlap, and PPC-SEO overlap. We’ll explain all three in detail so you can understand what you’re up against.
So far, we’ve explained keyword cannibalization in terms of keyword overlap. Keyword overlap refers to when two or more of your ads target the same keyword. In many cases, you may have an ad group targeting multiple keywords/multiple pages, one of which unintentionally overlaps with a keyword in another ad group. Usually, one ad outranks the other and it may not even be the one you most want to show. So make sure you organize your ad groups carefully.
In PPC campaigns, you not only bid on keywords but on geographic areas. And unfortunately, overlapping geographic areas can also cause keyword cannibalization. For example, if one of your ads targets a city and another targets that city’s entire country without excluding the city, you end up with two ads that target keyword for the same city & multiple urls. Or perhaps you run PPC ads for two stores in the same area with overlapping radiuses. In both cases, you unnecessarily pump up the ad auction with your own ads. Plus again, the winning ad may not even be the one you most want to run.
Finally, your PPC traffic can overlap with organic traffic. Organic traffic refers to any visits to your website that you don’t pay for. So if a regular search on Google leads someone to your web page, it’s considered organic traffic. You can increase your organic traffic through search engine optimization (SEO) strategies. If you already rank high in search engine results pages (SERPs), spending on PPC ads will have diminishing returns and may even be a waste of money. You’re already ranking in the SERPs, so paying to appear in the promoted results section has diminishing returns. Plus, some users prefer clicking on organic results over sponsored results anyway.
Now that you know the different ways keyword cannibalization can harm your PPC campaign, let’s go over what you can do to avoid it happening to you.
First, you want to extract as much data from your PPC campaign as you can. Run a keyword report to uncover any of the overlaps already discussed. In Google Ads, you can do this by viewing the search terms report. Here, you can review your keywords closely and find out which keywords are driving your ad traffic.
Try targeting your ads only to exact-match keywords/same keywords. Cross-include any exact matches as negative keywords in unrelated ad groups first. And if exact-match keywords generate the traffic you want, leave out broad-match keywords altogether. In other words, make sure traffic generated by broad-match keywords is not already being served by exact-match keywords. Otherwise, you’re paying for two ads to do the job of one. The same goes for Dynamic Search Ads (DSA). Add targeted keywords as negatives in DSA campaigns and block any keywords that overlap.
As for PPC-SEO overlap, decide whether you want to rely on organic traffic or not. Experiment with switching off individual keywords. Wait and see how much organic traffic you get for the keyword and compare it to when you had paid traffic. Also check if competitors are targeting your keywords to gain insight on the level of competition in organic traffic, CTR, keywords, search volume, and so forth. This way, you’ll know what you’re up against if you decide to eliminate PPC-SEO overlap by dropping ad spend.
Examine how conversions change week to week and identify trends so you can adjust accordingly. PPC advertising is a matter of trial and error. The faster you learn what works best, the better.
After you’ve diagnosed keyword overlaps, do all that you can to avoid them in the future. Don’t target plurals for keywords and always check keyword spellings. Google will match close variants of keywords, so a plural or a misspelled keyword could easily lead to keyword overlaps. If you have a lot of keywords, try using a tool to identify close variants faster.
Avoid overlaps in geographic targeting by excluding cities from country targets if running ads in both. Check target radiuses as well to ensure there is no overlap. The last thing you want to do is pay twice for the same target area.
Avoid splitting PPC traffic across multiple web pages/multiple pages by maintaining a one-stop authoritative web page that links to other web pages that fall under the same keyword. Try using 301 redirects to link pages of lesser importance to a single definitive version & avoid wrong page also keyword stuffing.
Finally, avoid keyword overlap by concentrating your ad spend on one keyword instead of many. That way, you not only don’t spread your ads too thin but you ensure that they don’t work against each other.
With brands trying to dominate the SERPs, the risk of keyword cannibalization occurs has only increased. So it’s more important than ever to keep a close eye on your PPC campaigns. If you don’t, you could be wasting valuable ad spend and not even realize it. Fixing keyword cannibalization early on will not only lower CPC costs but increase your conversions and ROI.
If you need help auditing or managing your PPC strategy or fix keyword cannibalization, ppc.co can help. Our skilled experts will quickly identify where to optimize and make improvements, so you can start getting the most out of your PPC campaigns. Contact us today to get started managing your PPC campaigns.
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If you’re running an e-commerce or retail business, you already know that visibility is everything. The best product in the world won’t sell if no one sees it. That’s where paid ads for ecommerce comes in.
Done right, they drive traffic, conversions, and repeat customers.
Done wrong, they drain your budget and leave you wondering what went wrong.
Whether you’re spending $500 a month or $50,000, your goal is the same: profitability. Not just clicks, and certainly not just impressions. You want to turn ad dollars into real, predictable revenue.
So how do top-performing e-commerce and retail brands make their paid ads work?
What are they doing that you’re not?
This guide breaks it down step-by-step, so you can start running profitable ads with confidence.
Before you launch a single campaign, you need clarity on your audience and goals. Are you trying to boost first-time sales? Increase average order value? Each objective requires a different strategy and metrics for success.
Don’t fall into the trap of launching ads just to “see what happens.” Paid media works best when it’s part of a bigger strategy. So before you log in to Google Ads or Meta Ads Manager, get specific about what success looks like.
If you want to run profitable paid ads, knowing your numbers is the foundation of your entire strategy. Without a clear understanding of your margins, break-even points, and how much you can afford to spend to acquire a customer, you’re essentially gambling with your ad budget.
And in e-commerce, that can get expensive fast.
Let’s start with the most critical numbers you need to know:
Your break-even ROAS tells you the minimum return you need on your ad spend to not lose money. It’s calculated by dividing 1 by your gross profit margin.
So if your margin is 50 percent, your break-even ROAS is 2.0. That means for every $1 you spend on ads, you need to make $2 in sales just to break even.
For example, let’s say you’re running Facebook Ads and spending $1,000 on a campaign. If your break-even ROAS is 2.0, you need to generate at least $2,000 in revenue to avoid losing money. Anything above that is profit. Anything below that eats into your cash.
Once you know your numbers, you can reverse-engineer your ad strategy instead of throwing money into the void and hoping for results. For instance, if your AOV is low (say $25), you might struggle to profit from ads unless you have a very low COGS or high conversion rates. In that case, you might want to:
On the other hand, if your AOV is $150 and your margins are strong, you have more room to compete in ad auctions, bid more aggressively, and test multiple audiences and creatives without instantly wiping out your profit.
A lot of beginner advertisers focus entirely on immediate return from ads. That’s understandable – but short-sighted. If you’re breaking even or slightly losing on the first sale, that might still be a smart move if you’re building long-term customer relationships.
That’s where Customer Lifetime Value (LTV) comes in. If you know that your average customer places three orders a year, each worth $60, then their LTV is $180. If you spend $40 to acquire that customer with your first ad, but earn $140 more over the next 12 months, that ad was extremely profitable in the long run.
Top e-commerce brands build their paid strategies around LTV-to-CAC ratio – how much they earn over time compared to what they paid to acquire the customer.
A healthy ratio is usually 3:1 or higher. So if you’re spending $50 to acquire a customer, you want to earn at least $150 from that customer over time.
Once you understand your numbers, you can plan your ad spend with precision. You’ll know exactly:
Let’s say you want to make $5,000 in profit this month, and your product has a 50 percent gross margin. That means you need $10,000 in sales. If your target ROAS is 2.5, you can spend up to $4,000 in ad spend to hit that goal. With those numbers in hand, you now have a roadmap for campaign budgeting, not just a shot in the dark.
Every ad platform has strengths. But if you try to use them all at once, you’ll burn through your budget without learning much. Instead, pick one or two that align best with your business model and customer behavior.
If you’re selling visually appealing products like apparel, skincare, or home goods, platforms like Instagram and TikTok can deliver strong returns – especially with the right creative. If you’re focused on high-intent buyers, Google Search and Shopping Ads are goldmines. And if you’re targeting professionals or B2B retail buyers, LinkedIn may offer surprising results.
Test channels strategically. Start with the one that matches where your customers spend their time and scale from there. The best platform for you is the one where your ideal customers are already shopping, scrolling, or searching.
One of the biggest mistakes retailers make is casting too wide a net. You don’t want everyone to see your ad – you want the right people to see it.
On Google, this means targeting high-intent keywords that signal buying behavior. Focus on terms like “buy,” “best,” “free shipping,” or product-specific searches. On Facebook, Instagram, or TikTok, you’ll want to dial in your custom audiences using demographic data, lookalikes, interests, and behavior.
Don’t forget retargeting. Most people won’t buy the first time they visit your site, but retargeting brings them back when they’re ready. Set up ads that follow people who viewed a product, added to cart, or engaged with your brand but didn’t check out.
The more relevant your targeting, the more efficient your spend and the higher your return.
Creative is the make-or-break factor in most e-commerce ad campaigns. You can have perfect targeting and the right product, but if your ad doesn’t grab attention in the first two seconds, it won’t convert.
Your creative needs to do three things quickly:
Use high-quality product photos or videos. Show your product in action. Highlight a clear benefit or solve a specific problem. Incorporate customer reviews or user-generated content to build trust.
For paid social, test multiple creatives at once – video vs. image, UGC vs. branded, short-form vs. long-form – and let performance data guide your iterations. On search platforms like Google, focus on copy that’s compelling and packed with relevant keywords. Test different headlines and descriptions to see what gets the best click-through rate.
Sending paid traffic to your homepage is a rookie mistake. You want every click to land on a page that’s designed to convert. That means fast load times, mobile optimization, and a clear call-to-action.
If you’re promoting a specific product, send users to that product page and not your full catalog. If you’re offering a bundle or a seasonal deal, create a dedicated landing page with copy, visuals, and layout tailored to that offer.
Remove distractions. Reduce friction. Make it stupid-easy for people to buy. The less effort it takes, the more sales you’ll see. And don’t forget to A/B test. Sometimes a simple tweak to your headline or CTA can double your conversion rate overnight.
Once your ads are live, your job isn’t done. In fact, this is where it really begins. You need to monitor performance regularly, looking at more than just the surface-level metrics.
Click-through rate (CTR) tells you how well your ad is capturing attention. Conversion rate shows how well your landing page is sealing the deal. ROAS tells you how profitable your campaign is. And CPA helps you compare efficiency across different products or audiences.
Watch for early indicators of success – or failure.
Treat your campaigns like living systems. Tweak, test, and improve them continuously.
Once you find a winning combination – an ad, offer, and audience that works – it’s time to scale. Increase your budget gradually while keeping an eye on performance. Scaling too fast can tank your results, so go step by step.
Duplicate high-performing campaigns to test new audiences or creatives. Experiment with upsells, bundles, or time-limited offers to increase AOV. Layer in email or SMS marketing to retarget paid traffic and drive repeat sales.
And just as importantly, don’t be afraid to kill underperforming ads. If something isn’t working after a reasonable test period, cut it. Your budget should be flowing to what works – not what you hope will work.
One of the biggest mistakes in paid advertising is chasing one-off sales without thinking about the bigger picture. Winning e-commerce brands think in terms of customer lifetime value.
If your first sale breaks even, that’s fine. (As long as you have a plan to turn that customer into a repeat buyer. ) You can use post-purchase emails, loyalty programs, and retargeting ads to bring people back.
At the end of the day, when you view paid ads as the beginning of a customer relationship – not the end – you unlock real long-term profitability. And at PPC.co, that’s where we want to help you! We offer industry-leading PPC management services for ecommerce and retail brands who want to stop wasting ad spend and start generating real ROI.
Contact us today to learn more!
