[timdierks]

They're not so bad when they're not broken; a lot of the time, you can't even tell that an ad is using them, because it's natural and appropriate.

Here's the (best) use case: let's say I sell garden equipment: hoses, sprinklers, garden gnomes, etc., so I advertise on those terms as keywords. I could have one ad that says "Best Garden Equipment", but tests show that ads work better if they specifically name the product that the user is looking for. So I can use keyword expansion to have the ad say "Best Garden Hoses", "Best Garden Sprinklers", "Best Garden Gnomes", etc., and not have to manage a lot of different ads.

This can be used in much broader cases, too, such as if I have hotels in 500 US cities: load up the keyword expansion with the names of all 500 cities and run an ad with title "{CITY_NAME} Hotel Rooms".

The problem is when people load it up with a jillion keywords in the hope that, if they get a click, they'll look for matches in their product database afterwards, and sometimes they fail.

So, yes: frequently lame. But when it's not misused, pretty useful.

[rwmj]

When we ran the AdWords account for [major UK travel agency that you will have heard of] we never used templates. We created 50000+ keywords and thousands of associated adverts -- with a mix of hand-written keywords/ads and custom code to generate them. And we tuned the results frequently, which often involving writing more code. (In OCaml, no less!)

If you don't take shortcuts, you get better results.