I was recently talking to a prospective client with a lead-acquisition model about their SEM goals, and I learned that they were using one blended lead target for all their SEM. With Thanksgiving still lingering in my head, I started to think of ways this client could “slice their lead pie” to drive additional value and efficiencies from their budgets.
A single, blended lead goal can be great. It means that the poorer-performing parts of your acquisition strategy are subsidized by the higher-performing parts, that you understand your average conversion rates, latency, and lifetime value of your customer. However, beyond that there are lots of other ways to slice the lead pie to make sure you are allocating your budget and bidding in the most efficient manner to drive valuable leads.
- Brand vs. Non-Brand: This one is pretty common and pretty self-explanatory. A brand conversion comes from a user you have already sold awareness to, so the value of that user is likely to be different than one coming from a non-brand keyword.
- Geographical: You probably have certain cities or states where the value of a user is different. It may be that closer to home you have built more brand awareness, so general leads turn into revenue at a higher rate. Or, it may have to do with regional differences. A person in Colorado buying a snowboard likely has a higher lifetime value to your snowboarding ecommerce site than a person in Florida buying a snowboard. Mine your data to slice out true geographical value and build your campaigns to support bidding and budget allocation where it matters most.
- Intent: Segmenting high- and low-intent keywords allows you to direct more of your spend at those users most likely to buy. Which lead is more likely to buy a car from your Nissan dealership soon: the person who searches for “best cars” or the person who searches for “2012 red Nissan Sentra”? Both keywords may be important parts of your strategy, but they carry different value and therefore represent different slices of your lead pie.
- Core vs. Test Media: Consider isolating your core conversion-producing keywords – the ones you can always count on. How much of your budget do they use? Allocate the remaining budget to performing tests where the lead goal is loosened since you are investing in knowledge as well as leads in this slice.
- Seasonal vs. Non-Seasonal: If your business has seasonal shifts, consider slicing out the highly seasonal keywords and budgeting them differently. Your wine business may want to spend half your budget in December on champagne leads, but perhaps they are not as valuable the rest of the year.
- Demographic: 18-to-24-year-olds may be very interested in your luxury products, but they generally don’t have the purchasing power to buy them. Figure out your sweet spot for gender and age range and value these leads higher.
- Category: If you offer more than one product, there are likely different user behaviors for people interested in different products you carry. A lead for yacht insurance indicates a highly affluent user who may be of more lifetime value than a lead for renters insurance. This starts with the search query but may be something that is indicated in a form field or by other on-site behavior.
- Display vs. Search: Most people break out search and display for tracking purposes, but looking at your true lead value for each channel takes it a step further. Display leads are often less expensive, but they carry less intent and may be less valuable.
Though many people use these techniques to optimize for their CPA, digging into the data about what happens between lead acquisition and lifetime value can inform totally different approaches to these “slices of your lead pie.” Implement a tracking system that allows you to measure from click all the way to lifetime value. Dig deep into your data and layer your segments (high intent, best geography); it’s common to find slices that warrant a CPA 2x or more than the overall blended CPA. Structure your campaigns to give you control of the budgets and bidding that maximize the sweetest pieces of the pie.
– Susan Waldes, Senior SEM Manager
– Questions? Comments? Email us at blog at ppcassociates dot com.