That’s right, you heard me. It’s time to take a hard look at paid search and see if it is really driving leads that convert into sale. If you sell a consumer product, paid search may indeed still be a goldmine (just a bit more costly than it used to be). But if you sell to businesses a product that requires a considered purchase, chances are that paid search leads aren’t pulling their weight.
How to check if paid search is working
B2B marketers have set up their paid search campaigns and other than content campaigns, they are pretty much ‘set it and forget it’. Sure, you’ve got someone adding negative terms and continuing to monitor the CPC, but not a lot of brain power goes to search because you’ve already maximized results for the budget you have allocated.
But when is the last time you looked at how many Closed Won deals originated from paid search? If you don’t have attribution software, you may not be checking this at all. But that needs to change. Take the time (even if it is manual) to find out what happens to paid search leads.
You’ll want to know:
- The % of paid search leads that are qualified.
- If you are doing ABM, you’ll want to see the % that come from target accounts.
- The % of paid search leads that become opportunities.
- The % of paid search leads that make a purchase.
- The average purchase amount of a paid search lead.
- The cost per acquisition via paid search (total cost of paid search budget/#new customers from paid search).
Of course, you’ll want to capture this information from other lead sources so that you can compare the data.
Once you’ve completed your analysis, chances are you’ll find that paid search is your least effective lead source with the most expensive CPA. So should you really be doing it anymore? I know, marketers hate the idea of not showing up for a key term that a sales executive randomly searches on (in Australia on a Saturday). But if you make a business case, they will listen.
The business case: Why paid search isn’t working for you
There are a few key reasons why paid search isn’t producing the results it used to. Line the data up to the issues that are logical for your situation and you’ll have a great explanation that sales leaders will pay attention to.
Everyone entered the PPC game and prices continued to escalate for the best terms. You’ve likely got a slew of long tailed key terms to keep prices low, but that just adds to your management cost. It becomes hard to justify the high cost of “staying in the game” when the outcomes aren’t anything to shout about. That is the same trap that marketers fell into with tradeshows, “We have to be there because our competitors are.”
2. Developing market
Many B2B companies are in developing (or emerging) markets where there isn’t yet widely spread awareness for your solution. If this is the case for you I ask you, “Why would people be searching for your solution if they don’t know it exists?” If you’re using PPC because that is what you did at your last company, stop and think hard about buyer behavior in your market to ensure it is actually a fit.
3. Late stage leads
The biggest reason PPC isn’t attractive for considered purchases is because PPC enter your sales funnel late in the game (see old school funnel on right). Sales might say, “Those leads are awesome, I don’t need to sell much, I just demo and quote.” But do they have a high rate of close? Chances are no because there is competition in the buying process. You’ve missed the opportunity to set purchase requirements and are relegated to the dreaded “column fodder”.
4. Not ideal buyers
There is no way to control in PPC who clicks on your ad. In all likelihood, sales will spend a lot of time talking to people who can’t afford your product or need something with very different features. Spending money that isn’t focused on target buyers is wasted spend.
5. Attribution issues
Those leads from PPC that did make a purchase you may want to dig in and scrutinize further. Often times a buyer in the sales process will click on a paid ad to get to your site once they become serious – particularly if you run PPC on brand terms. Chances are that a lot of other marketing and education happened before PPC got the attribution. That means that removing the PPC won’t remove the buyer from your funnel.
Reallocate your spend to ABM
The best addition to your business case to end paid search is to explain what you will get for those re-allocated funds. You can certainly just shift that money over to the lead source that is providing the lowest CPA. But if you haven’t started yet, my recommendation is to use the money from PPC to start experimenting with Account Based Marketing (ABM).
ABM is all about taking the age old concept of target accounts, but using new technology to market to them. For instance, you can use target IP advertising that only serves your ad up to your target accounts based on IP address. This gets the attention of your target accounts at an earlier stage in the funnel so you can keep competition out of the sales cycle.
ABM practices are very cost effective and will yield a much lower CPA than PPC. If you are a startup or small business, you’ll want to read How Startups Can Rock Account Based Marketing (ABM). If you are part of a large company, here is a great guide with 10 Steps to Transition to ABM.
Whatever you choose to reallocate your spend to, make sure it is high producing and sales will be thrilled with your decision.