Learning Big Lessons from Small Business PPC Campaigns
We have a client who has a small business and a small Google Adwords campaign. They advertise in about a 20 mile radius, since anything larger would have a diminishing conversion rate.
For the sake of this example, we are not going use the client’s real name or vertical, but we will illustrate the data through a fictitious company. Let’s say this client is an indoor sports complex that offers flag football and soccer leagues.
This particular client came to us with an existing Adwords campaign with specific geo-targeting and asked if we could optimize it for better performance.
Sure, that’s what we do.
Looking over the history of the campaign, we found quite a few areas for improvement: Negative keywords, better campaign structure, new ad copy, keyword research for more opportunities, strategic bidding – basically, the works. When all was said and done, we created an organized, improved campaign.
Then we hit launch.
After the first month, we saw a moderate increase in traffic, but nothing major due to the limited geo-targeting. However, we did see a nice decrease in the CPC due to better quality scores. After looking at the search query report, the search terms were more on-target.
However, the overall leads did not improve in the first month we ran. In fact, they went down. Not good. So after discussing the issue with the client, we found something interesting…
(Keep in mind, we work with a lot of small business, and sometimes tracking actual results is not their strong suit. We can tell them how many leads and phone calls they received through analytics and software, but when it comes to the conversion rate from leads to sales, we are sometimes at their mercy. That’s why discussions like these are so valuable.)
Using the previous month as a comparison, they had 60 leads, or about 2 per day. In the first month after launch, they had about 40 leads – a 33% decrease in lead volume.
Now the conversion rate in the new month was better than the old month. About 40% of the 40 leads converted to actual signups. So that’s 16 signups. Whereas only 33% of the leads converted to signups of the previous month, so they had 20 signups. But the previous month still performed better on a volume-basis. And that outweighed the reduction in cost.
But here was the really puzzling issue: We felt we really improved the campaign. The quality was better, the CPC was lower, the search terms looked great, the quality scores were higher, the traffic was slightly higher, the lead-to-sale conversion rate was better, so why were there less leads?
(I know these numbers are a small sample size, but with small business that is usually the case, and any decrease in leads or sales is disappointing for a small business.)
Now, for this example (and actually in the real situation) there were some constants: landing pages were the same and we ruled out any seasonality or timing issues; the leads were all phone calls, so we couldn’t track calls back to actual keywords, but we knew from the phone lead totals that the campaign was generating calls; and at the time, the Adwords campaign was his only form of marketing.
It was time to dig a little deeper. We found that in the previous month, the top search term (9 out of the top 10) were related to soccer as opposed to football. In our month, the ratio of the top ten keywords were split about 50-50 between soccer and football terms.
Why? Because we added more keywords, coupled with the fact that the quality score increased, so football terms received some better impression levels.
So after noticing this trend, I asked the client how many of the 30 leads in the previous month were soccer leads as opposed to football leads. Answer – all but 2. And how many of the 20 leads in our month were soccer? Answer – all but 5.
There is no doubt that the soccer keywords generated more leads than the football terms. So by changing that keyword ratio, we cannibalized some of our leads within the budget.
But why did soccer convert better? Some reasons are more about the sports league industry than the actual PPC campaign. Soccer was more popular in this particular region; there was more/better competition from other football league websites; football leagues are more expensive; football can be more dangerous (subject to debate), and other factors.
Once we identified that trend, we were able to make the proper adjustments.
1) Create separate campaigns for soccer and football with separate budgets. This would allow us to spend more on soccer and not have football terms eat up more of the budget than we would like.
2) Bid more aggressively (within reason) for soccer terms, since we now know they convert better.
3) Use a better landing page for football to help improve lead volume and conversion rate.
So, in the immortal words of Stan Marsh, “We’ve learned something today.” Even if you do everything right to optimize a campaign, there are still some curve balls coming your way. That’s why client feedback and communication are so important. It helps improve performance and solve issues.
Did we get more clicks, lower costs and improve ROI? Initially, yes. The client was very happy from the get-go; but it wasn’t until we discussed the actual results that we truly improved the campaign. Now the proportions are better and the leads are back up.
And that is the real win.