What Price Differentiation?

Google has just released a suite of competitive analytic tools to allow AdWords advertisers to compare their performance against an anonymous set of their competitors. Analyze Competition will allow you to look at your activity for the previous two weeks and lists categories that represent the products or services you're advertising. Categories are based on actual search terms and are matched up against your keywords, ad text, and landing page text. The report shows your individual performance compared to the average performance of other advertisers in the same category.

Great. This update will certainly make the auction more efficient (if I remember my A Level Economics, the more information that is available the more perfect the market, or something like that...). But, will it make you a more effective search  marketer? On one hand, the tool will help you identify the most relevant key words, but it won't help you understand anything about your ad copy or the relevance of your landing page. 

Search is still too dependent on one of the dimensions of relevance, "What" (the expression of intent). The most effective way to stand out from the crowd and really make inroads into the competition is to understand the drivers of your audiences' choices, in other words understand the underlying factors that motivate their behaviour. Understanding this will allow you to craft your ad text and landing page copy around a second (and potentially much more powerful) dimension of relevance, "Why".