As Google continues to push automation, advertisers have become more creative in making updated best practices, including Smart Bidding strategies, work for their businesses and verticals.
While value-based bidding has become a staple for e-commerce and retail brands, non-retail sectors have struggled to effectively incorporate it into their holistic PPC strategies.
This article explains the challenges non-retail industries face when adopting value-based bidding in Google Ads and how to make it work for your unique business.
Making value-based offers work for non-retail brands
Most e-commerce and retail brands can seamlessly upgrade their bidding strategies to value-based models.
Income is already set up.
The conversion path is clearly valued (i.e. add to cart, purchase, first time purchase or return value)
The steps for the transition make sense.
But for finance? SaaS? Insurance? Health and education? It’s been a more complicated shift for many advertisers in these fields.
Essentially, value-based bidding takes into account designated signals that account for the quality of a customer and ultimately optimizes for maximum value for the business.
This is absolutely possible for non-retail businesses and will work the same way. But it should be treated a little differently in terms of strategy and setup.
Think about your business and what you’re most proud of from an advertising or website analytics standpoint:
Are your users spending an average of 10 hours on your site per visit? (This could be a world record, so congratulations!) Have you spent a lot of time and energy making sure your attribution method is accurate? Is your YouTube channel statistically and unwaveringly contributing to 99% of your conversions? Are you struggling with bounce rates from lead to lead? If so, you are indeed a perfect candidate for value-based bidding.
Consider what is valuable to your business and what tagged activities contribute to the lifetime value of your customers.
Once you’ve answered these questions, you’ll have demonstrated that value-based bidding will work for your business.
In the meantime, there are several general factors to consider:
Identifying conversion actions to include Defining conversion rates and assigning values. Considering whether to include offline conversions in the data.
Below are different options and thought starters for each step.
Goal setting: what is most important?
The funnel stage is an incredibly important piece of the puzzle.
For many advertisers, it may seem like there are limited options for which conversion actions are most important to their bidding strategy.
For example, a B2B company whose primary KPI is qualified leads generally can’t optimize as low in their funnel in a bidding strategy due to data limitations or low conversion volume.
Ideally, you will have 2-4 conversion actions tagged with a value for value-based bidding to work effectively.
However, many non-retail businesses may struggle to decide what else is important to them outside of the final shipment or last step conversion element.
In many cases, contact form submissions are the last data point tracked using a conversion tag or Floodlight for advertisers to optimize.
Marketers need to remember that every touchpoint is important in a customer’s journey.
You might mark a page view, time on site, and lead start as a set of conversion actions to include in a bid strategy.
Each is a brand in the consumer’s journey to becoming a qualified lead. Basically, value-based bidding is being optimized for more than lead volume or an efficient tCPA.
Any data that advertisers can tag for the algorithm is useful.
The fine line here, however, is to determine which conversion actions have a high enough volume of conversions per month (30-50 actions minimum) while being low enough in the funnel to drive higher conversion rates and qualified
Secondary and tertiary touch points: the middle of the iceberg
If you’re having trouble identifying secondary and tertiary goals to include values, imagine your customers’ journey from their perspective.
How many pages do they have to visit or how many buttons do they have to click before completing the main conversion?
If the primary goal is to click a button on the homepage, consider including a minimum time on page as a secondary conversion action to increase the number of qualified leads.
If a page view is too wide, how about creating an engaged visit action, where time on page must be longer than 30 seconds to count as a conversion?
Or visiting 3-4 pages, using Google Analytics data to create a custom conversion?
From there, you can drill down into the most impactful part of the funnel before losing offline data that may be unavailable or difficult to import at a consistent cadence.
In these scenarios, it is crucial to align to the best tipping point.
Can we optimize for lead form submissions since they will have higher volume, or should we import offline data from leads or leads as a final touch, even though we know the drop off is steeper?
If your offline conversions are less than 30 per month, even if they are worth 100x the lead sending, it would be better to aim higher in the funnel so that your bid strategy can be better optimized.
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Define Values: What’s Worth It to You?
Once a goal has been agreed upon, it’s time to look at values. Google has published a useful calculator as a starting point.
However, it’s also good to have an internal contact and analytics resource on hand to help you review known data points, conversion rates, lifetime values, and any other variables important to your business. .
Conversion rates will be your easiest entry point.
If you’re looking at 100 engaged page visitors, 60 contact form starts, and 50 contact form submissions, with $100 worth of contact form submissions, you can calculate your breakdown metrics using Google’s calculator.
This will tell you that lead submission is worth $100, lead form initiation is $83, and page view is $50.
If your approach requires lifetime values to be calculated, use your CRM as the source of truth to assess your customers’ highest potential within your company.
Once you’ve calculated the highest value (within the ~30 conversions per month guideline), work backwards with your analytics team to determine specific values for the events that lead to the primary goal.
Offline data: to ingest or not to ingest?
The last important common aspect of a non-retail bidding strategy is the ingestion of offline conversion data for optimization.
At best, offline conversions are set up and available directly in Google Ads or SA360 for conversion action with minimal proxies or gaps.
In reality, there are often data delays, connectivity issues, and other unforeseen obstacles when setting up offline conversions.
To get ahead of yourself, consider what resources are available to you.
Do you have a team of 20+ people who can help you get everything in order? Do you need to work with six different vendors to attach each piece of the puzzle?
Assess your appetite for heavy work and how you can set smaller goals to achieve total value-based deals. Can you set up value-based bidding using just online tags to get started?
I would offer that most of your customer’s journey to your website or your ads is useful for informing value-based offers.
You’ve set up a great online user experience for your customers to find you (paid ads), reach you (your contact information is listed somewhere, I’m sure; if not, make sure it is! ) hand showing interest in your company (a contact form, a phone call, an appointment booking, etc.).
Anything off the web for most of these industries—a closed booking, showing up for an appointment, scheduling a follow-up meeting—will happen more naturally and at higher prices by bolstering your online footprint through content-based offerings. the value
Embracing what sets your industry and business apart
The shift to more automated bidding and the emergence of value-based bidding as an option for many verticals are both for and against.
Any business considering moving to value-based offerings, but wary of the effort or setup, should step away and consider the strategies outlined above to begin their journey toward value proposition.
The future of advertising is only going to be automated in interesting ways, so make sure the “best practices” work best for you before they become optional and/or continue to evolve.
The views expressed in this article are those of the guest author and not necessarily Search Engine Land. Staff authors are listed here.
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