Over the last few years, Smart Bidding and offline conversions have completely changed the way PPC account managers and strategists win high-quality leads.
In recent weeks and months, our CEO Frederick Vallaeys has been encouraging PPC pros to use offline conversions to tell Google’s machine learning algorithms what good traffic looks like.
That’s because as ad platforms like Google Ads become more and more automated, the PPC expert’s role shifts from controlling levers to feeding in the right information.
Ad platforms then use that information to make decisions on advertisers’ behalf, putting your ads in front of what they believe will be high-value traffic, which account managers then report back on once more.
And thus is born the new optimization cycle of the automation era.
So we got the best experts we could – Google themselves – to join us for PPC Town Hall on July 14. We talked a bit more about how to use offline conversions – as well as Smart Bidding – to win high-quality leads.
Here are our 5 big lessons from speaking to Emi Wayner and Alex Ioch, a regional automation lead for Smart Bidding.
1. Customer data is the key to sustainable growth
A study by Boston Consulting Group indicates that online advertisers see average gains of 20% incremental revenue and 30% cost efficiency when they integrate strategies with customer data across the purchasing journey.
Whether you choose to import or track offline conversions, it’s tough to argue against the importance of first-party data when optimizing modern PPC campaigns.
2. What you should measure
While Google Ads can measure online activity, sometimes a user who clicks on your ad and enters your sales system converts offline where Google can’t see it, like your CRM or in person.
So there are two groups of components you want to keep track of.
Online: leads & sales
When you track only leads, you get a fair idea of the initial demand for your product or service. Extending tracking to the final sale gives you a better picture of your overall purchase journey:
- How much interest does your brand generate online?
- How long can you sustain that interest?
- How well can you persuade people to give your business money?
Sometimes, even the final sale happens offline. And in these cases, it’s critical to feed that information back into Google Ads with offline conversion imports.
But even if you were to track both leads and sales online, you’d still only see a part of the picture. If a university gets 2,000 requests for information that ends up with 20 enrollments, all they know is they have a 1% conversion rate.
But what about all the other stuff that happens in between? How much did that contribute, if at all?
Offline: The middle funnel
There’s usually a big disconnect between what advertisers tell Google to track and what actually matters to their business. An online form submission is easy to fire a pixel on; you can’t do that for things that happen offline or on a channel that isn’t trackable.
But when you do measure what happens between lead and sale, you get a better idea of what actions are most profitable for your business. Let’s take the same university example Google showed on PPC Town Hall:
- 2,000 requests for info yield 200 applications started (10% conversion rate)
- 200 applications started end with 80 applications completed (40%)
- 80 applications completed lead to 20 students enrolled (25%)
All of a sudden, you can see more of what impacts the final conversion. When you feed that information back to Google is when the magic really happens.
3. Estimating expected value
When you import offline conversions into Google Ads, it helps to be able to assign values to them based on what level of value they contributed to your business.
The best way to do that is to work backwards:
- You know that a student who enrolls contributes an average of $10,000 to your university
- You account for some fluctuation and tell Google that a completed application is worth $2,000 (25%)
- A started application is then worth $800 (40%)
- And a request for info is worth $80 (10%)
These numbers make it easier for Google’s algorithms to piece together the signals that make a user worth $80/$800/$2,000/$10,000 to your university.
Important: “Don’t get hung up on the numbers,” Alex says. Conversion values are a tool to help Google score and prioritize different users, and these numbers do not directly impact your ad spend or ROAS.
4. Smart Bidding works best with offline data
When you use Smart Bidding in isolation, Google will look at tens of millions of signals that are familiar to most online advertisers:
- Conversion rate
- Audience segment
- And much more
But when you import offline data, you can feed so much more information to Google that it uses to optimize future targeting. In the case of a university, this might include parameters like:
- SAT scores
- Preferred courses
- Credit history and score
- Referrals and awards
- Existing credits
All of a sudden, the jigsaw Google is trying to put together of your ideal user gets a bunch of new pieces. Now they can tell with greater accuracy which bids for which audience groups will give you the best returns.
5. Value-based bidding strategies work best
Assigning conversion values lets you differentiate potential customers and bid toward more valuable outcomes.
For education, that could look like assigning different values to students who request a brochure and ones who sign up for a free online course. In retail, it might mean segmenting customers who make frequent returns from those who end up keeping their purchases.
A value-based bidding strategy tells the Smart Bidding algorithms that one group of users/customers is worth more to the profitability of your business than another.
And so Smart Bidding then knows to optimize for the group that is worth 2x/3x/10x more to your bottom line, giving you greater value from your ad spend that goes beyond just ROAS.
Additionally, fixed-value bidding skews your spend and limits your returns. User segments with a higher average bid than your fixed value become missed opportunities, while you over-invest in segments with lower average bids.
Test, monitor, optimize
Remember, there’s no shortcut to success or way around doing the work. Test your ideas, monitor the outcomes, and them optimize your campaigns based on best results.
Automations like Smart Bidding require a volume of manual conversions before they can begin making the right decisions for you, so lay the groundwork with manual optimizations.
Once you know what works, automate the solution and keep your inputs manual. And use a third-party tool to speed up your other optimizations, to give yourself more time for strategic work.
Optmyzr offers a 2-week free trial to help you do just that!