ROI Tracking

The Dirty Little Secret About Paid Search

By May 6, 2010 May 18th, 2016 7 Comments

Before you embark on a potentially expensive paid search campaign, consider this one insight that could change your mind.

While Pear focuses on organic search (SEO), we do mingle around and talk to a lot of experts in paid search. Experts who work paid search campaigns day in and day out. The other day I learned something very interesting.

The longer the sales cycle in your business, the worse your paid search campaign could perform.

In fact, if it takes you longer than 2 weeks to close a potential lead from click to sale, then paid search might not be a great fit for you. This is not an off-the-cuff statement, but rather a conclusion based on a long history of data obtained by a close partner in the business. Now there are always going to be exceptions to the rule, and there are many other factors that go into paid search ROI, but this is a good rule of thumb, and here’s why.

Paid search works better when an impulse action (like a purchase or contact) is involved. Let’s look at a few examples:

search engine marketingPlumbing Service – your bathroom had a backup and is flooded with raw sewage. Do you search 15 plumbers and call for quotes? Not likely. You choose the first or second option you see based on the most credible looking, easiest to contact (maybe they are open 24-hours or offer emergency response) plumber. You probably don’t care much about the price either – you just want it fixed.

Real Estate – most of us don’t buy property in less than 2 weeks. We look at lots of options, talk to lots of people, make personal visits and collect a lot of information before making the final purchase. This is definitely not an impulse purchase. Paid search can work in this case if the margins are high enough to where even if the conversions are dismal, one sale could pay for the whole campaign.

Air Conditioning Repair – it’s already in the 90 degrees here in Texas and turning on your AC is a necessity. Like the plumber, you need the next available company to service your system, and the first or second listing will get the lead.

Home Health Care – getting a parent or loved one into a home health care situation is an emotional experience. Not only is the sales cycle longer than 2 weeks, but the decision is usually not with one person, which makes it a harder deal to close. If clicks are going for $5-10 a piece, you could spend hundreds before getting a new client.

What do you think?  Do you have any examples to share?

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7 Comments

  • Shelley Cook says:

    It’s an interesting idea. I’ve not seen great results with paid search, but I may start experimenting with this idea and target subjects of ads to more specialized topics and areas of search to impulse based spending. Will let you know if we see an increase.

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  • Ryan Kelly says:

    Hi Shelley! Please let us know your results. Also, make sure your landing page is what the ad is about. You want to make sure your Quality Score on the page is high. That will in turn reduce your cost per click (CPC).

  • Joy Batsh says:

    It makes great sense that paid search really does works better when there is an impulse action. It’s very true that when emergencies, like plumbing service, you don’t have to call all the plumbers listed and call them one by one. This is an emergency situation that needs to be done quickly. So I agree that paid search works best on situations like this.

  • Pashmina says:

    Well it can also depends on the value of the sale. If you’re selling a product/service where the average sale is $10K or more, then it’s a no brainer, even with a longer sales cycle. NOT doing PPC would be missing out on opportunity. Also, in a very competitive and/or lucrative marketing, a PPC campaign is a good investment for accurate keyword research.

  • Ryan Kelly says:

    Hi Pashmina,

    Yes, having a big ticket item, or high LTV can make a PPC campaign much more “worth it”. We find that most companies are not tracking the lead all the way through, and not attributing it to the original ad or keyword. This is feasible if the company is using SalesForce, or Omniture.

    We’ve also found that the visitors who come in through keywords on the paid side do not behave the same as those who come in from the organic side. It’s a great strategy to use high performing paid keywords to drive your SEO focus, but I would still expect some percentage of those to flop.

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