Inside the New Google Display Network Performance Metrics

4 Comments Written on June 15th, 2011 by
Categories: Contextual Advertising, Display Ads, Google Adwords

Some clever eyes spotted this as early as late last week, and yesterday Google officially announced it:  You can now see your “Relative CTR” compared to other content ads (text or display ads) shown in the same ad spots on the same content network pages.

Google also now says that your ‘relative CTR’ is a ‘good indicator of your content network quality score (not that that’s a big surprise though, we’ve always pretty much known content QS was driven by CTR relative to other advertisers’ ads in that same ad spot).

How to View Your Relative CTR

You can view your “relative CTR” rating at the campaign or adgroup level. To see it, go to “Customize Columns” and check the box to display it. This works in the All Campaigns screen as well as when you drill into a specific content-only campaign:

To evaluate these numbers, HIGHER IS BETTER.  Anything below 1x is “below avg” and will likely have fewer impressions that “above average” 1x adgroups.

So if my relative CTR is 2.3x, I have a 2.3 times better CTR for that adgroup than my competitors.

If my relative CTR is .8x, I have a 20% worse CTR than the average CTR for that adgroup.

How To Use This Data

Now you can clearly see with it which adgroups desperately need new ads: ads that can get a relative CTR above 1x to bump out your competitors. Work on new ads for these right away, and evaluate your relative CTR for that adgroup daily until you get up over 1x. Then keep going to improve even more if you want to really lock your competitors out.

If you use the date selector to look at a longer period of time (say the last 30 days) you can get an idea of how the competitive landscape moves and shifts in your campaign. You’ll also be able to tell when a competitor comes up with a killer new ad that’s forcing down your relative CTR, reminding you to go check the ad out on your top content placement pages and see what’ they’re doing and beat it:

Impression Share % for the Display Network is Also Back

Google has shown you your campaign’s Impression Share % column for a while now, but for Search campaigns only.

A while ago a similar metric appeared for display network only campaigns, but then disappeared.

Google is now showing Impression Share % again for display campaigns. This shows you how much of the total display ad or content ad pie you’re getting for your campaign.

To enable it, on your All Campaigns screen, click “Customize Columns” and check the box for the “Impression Share” column. You’ll then see it likeso:

Overall, we’re seeing a lot more information on what’s happening behind the scenes in the display network auction: very cool. Prior to this you just had to make assumptions about what to tweak and rely on fuzzy metrics like avg position and actual CPCs.

Out of interest’s sake, in my top content campaign that gets around 50 million impressions a month, all of my relative CTRs are over 2x, which might be why that campaign has 73% impression share.

One More Thing…

Google has also announced that they’re adding an ad diagnostic indicator to help you see whether your ad is showing on a particular placement page or not:

 

 

 

 

 

 

 

 

 

 

 

This feature isn’t live yet for all advertisers, but should be by the end of July.

In what ways can you envision using this new data?  Share in the comments!

PPCblog’s Greatest Hits – A Compilation of Our Best Posts!

Comments Off Written on June 8th, 2011 by
Categories: Uncategorized

Eventually, everybody gets to the point that they need a greatest hits compilation… here’s PPCblog’s… We’ve gone through and hand-picked our favourite and most helpful PPC blog posts, categorized for your viewing enjoyment.  As we continue to provide helpful guides and advice on the world of paid search, we’ll keep this page updated, so please share it with friends and colleagues who are interested in the world of PPC!

 

Online Marketing Advice

Opinion & Comment

 

Adwords & General PPC Tips

Facebook Ads

PPC Consulting

Landing Page Help

Product & Service Reviews

 

Display URL in Adwords Headlines: Early CTR Results

8 Comments Written on May 31st, 2011 by
Categories: Google Adwords

I have to say I haven’t really been a fan of the appearance of the Adwords ads Google now shows in the above-the-SERPs positions that include the display URL in an “extended headline”.  Personally I think it strongly detracts from the power of your headlines if you’re using great headline ad copy and overall looks a bit ‘blah’, especially now that they’ve also squashed the capitalization in display URLs.

For those not aware of the change, in certain circumstances when your ad appears above the SERPs, Google will add your display URL to the headline likeso:

That looks great if your headline says something utterly boring like “Google Adwords” as they have here, but if your headlines don’t suck it’s pretty gross-looking.  That said, Google did do some testing before rolling this out as many search-watchers reported, and assumably it garnered higher CTRs.

This apparently started rolling out globally around May 17th, so I thought I’d wait a bit and see the effect it had (or didn’t have) on CTRs in one of my larger client accounts.

Some Early CTR Test Results

Here’s an example of a highly navigational, one-word query where my ad shows in position 1.1 almost all of the time, and I’ve confirmed Google is using the new display URL format in the ad (note: no changes to ads, keywords, or bids were made during any of these periods):

Before May 18th, on 5000 clicks: 5.17% CTR

Over 5000 navigational clicks since May 18th: 5.64% CTR

Roughly a 9% lift in CTR (Note: Not a lift TO 9% CTR)

Here’s an example of another randomly selected adgroup where the query is not really navigational in nature, but still only a two-word query (again in position 1):

Before May 18th, over 5000 clicks: 8.23% CTR

Across 5000 clicks since May 18th: 5.76% CTR

A 31% drop in CTR.

One more non-navigational, non-brand two-word query (position 1):

Before May 18th, on 5000 clicks: 3.43% CTR

Over 5000 clicks since May 18th: 2.86% CTR

A 17% drop in CTR.

So if CTR Doesn’t Climb, Why Make This Change?

Overall, when I look at these results, I’m made to wonder if the change was adopted by Google not because it lifts CTR, but because, as they say in their announcement blog post, “Potential customers, on the other hand, will be able to more easily identify the site to which they’ll be taken after they click on your ad.”

Could it be that the FTC and other governmental bodies are pressuring Google to be more clear about where a user will be going when they click an Adwords ad?  This corresponds quite coincidentally with Google’s recent push for more disclosure by Adwords advertisers on their landing pages.

Of course, these are random, anecdotal CTR results, but I hadn’t seen anyone post their stats on this yet, so I thought I’d see if we could get the ball rolling and get PPC marketers to share what they’re seeing.

What are you seeing in your accounts with this change?  Do you think these new headlines dilute the value of good-quality headline writing?

Share your thoughts in the comments!

 

Before:

Google & Privacy – Maybe We Should Be More Creeped Out

I got an email on Friday from a non-tech savvy friend that had recently asked me for advice on where to set up a new email account for her home business.  I recommended gmail, pretty much just as a reflex.

Here’s the email she sent me:

“…So here’s an interesting thing with Gmail:   I’ve been e-mailing back and forth about a quote for my services and one of the questions the client asked me is ‘am I covered by worker-injury insurance’.  I answered that I have do indeed have private accident and disability insurance, so no need to worry about my coverage while onsite.

Now–alongside my mailbox I’m getting ads about disability insurance, and legal claims for workplace injuries.  Somebody is reading my Gmail besides who I’m sending it to.  What’s up with that?  Is this phishing?  And how do they get into my mailbox?

Now, at first my reaction was the typical techno-geek response: “Duh, Gmail has ads and that’s why the service is free, I’m LOLZ because you think someone is reading your email”.

But then I thought about this for a second.  Someone is reading it.

Maybe I’m the one the joke is on, not the non-techie person.

The Joke is On Us

Consider for a second the world of ad targeting we live in where we’re so used to Google invading our personal data and online activities that it seems laughable that someone ‘non-technical’ would assume another party is reading their email and the like.

It’s kind of sad how Google-conditioning takes over and we forget, and even laugh at, the idea that our data is private and shouldn’t be read as fodder for ad targeting.

When you stand back and look stuff like this from a non-Google-user perspective, it’s pretty striking.  I used to think that one day ‘we’ll all look back and laugh at the time when our private communications were private’, but low and behold, we’re already there.

Maybe we should stop laughing.

 

Disclosure Doesn’t Have to Kill Conversions

2 Comments Written on May 18th, 2011 by
Categories: Conversion, Google Adwords

Starting yesterday, Google is requiring additional clarity and disclosure from Adwords advertisers who handle end user personal and payment information.  Some of the changes are dead-obvious like using SSL on credit card processing, but the others point to something you might want to consider in a bigger context.

The Larger Picture: Google’s Under Siege

The first thing to realize is that as much as the US FTC is applying pressure to affiliate marketers and the like they’re also putting Google through the wringer.  Add to that the US Department of Justice and various European authorities.  Late last week it came to light that Google has set aside $500 million to cover settlement costs with the US government over the use of Adwords undisclosed “rogue advertisers”, who are suspected to be unlicensed pharmacies, but perhaps other advertisers in other niches as well.

The salient point from the linked Wall Street Journal report above is this:

Search engines can be liable if they are found to be profiting from illegal activity. In December 2007, the three largest Internet companies, Google, Microsoft Corp. and Yahoo Inc. agreed to pay a combined $31.5 million fine to settle civil allegations brought by the Justice Department that they had accepted ads from illegal gambling sites.

Obviously Google is going to be working overtime right now to legally distance themselves from allowing Adwords to be used with anything “illegal”, which observers might think only applies to things like gambling and rogue prescription drugs, but that’s an overly narrow view.

Violations by Adwords advertisers of FTC or global regulatory body policies and directives could also fall into the liability sphere for Google, not just in the US, but in other countries as well as you can easily see by looking at the ever evolving country-specific changes to Adwords TOS.

Discerning the Writing on the Wall

When you look at the heat turning on Google from all regulatory angles it becomes clear that they’re going to start erring on the side of caution, pushing all Adwords advertisers to be more transparent with their Adwords-promoted offers, ads, and policies.

There’s a certain point in many large companies when the lawyers start driving the bus, dictating to the rest of the company how they’re going to roll when it comes to, in particular, how they go to market.  Microsoft is notorious for having to run any and all marketing communications through ‘legal’ before they put anything live.  It’s not hard to understand why given the decade of lawsuits they’ve pushed through, lawsuits and arguments Google is now facing.

Given their past tolerance, it’s unlikely that Google suddenly has a deep, altruistic interest in the handling of their users’ personal information, what people are buying via Adwords, or what customer expectations are.  A large part of their policy decision making in the past has admittedly been driven by customer complaints rather than a proactive effort to police their advertisers.  At the core, Google likes to let the market decide via click through and conversion data what should ads should run or die on the vine.  That’s how they run their entire ‘data-driven’ business.

Eventually though, and often due to affiliate marketers pushing things to the breaking point, Google is forced either by complaints, bad press or legal issues to jerk advertisers’ chains and bring things to a more transparent state.  But like anything in life, reactionary tactics often lead to over-reaction, and in the case of “disclosure” and “transparency”, that means can mean some very “non-conversion friendly” landing page adjustments.

Some advertisers think that the developing requirements are exclusively for ‘bad actors’ in the Adwords system and won’t merit adjustments on their part.  This has been historically shown to be erroneous thinking.

Don’t think for a second that any one advertiser spends enough on Google for Google to not ‘throw them under the bus’ if the  lawyers say things are posing an clear and present business danger to the Adwords collective.  Even the Apollo Group (i.e. one of Google’s largest advertisers, commonly known as “University of Phoenix”) would find themselves staring at the underside of a Greyhound if Google’s lawyers decided it was time to toss them.  No cow is too sacred.

Disclosure Doesn’t Necessarily Kill Conversions

So will adding Google/FTC-mandated background and TOS to your landing pages utterly destroy conversions?  Not necessarily.  Direct response marketers have been navigating these requirements for many years, before the Internet was even conceived.  How do they do it?

Take for example this excellent post on compliant direct marketing.  The key component in the strategies they’re recommending is effort.  Effort and some up front investment that will prove you’re serious.

Here’s another Pro Tip:  People just don’t like to read.  Anything.  Place a fully proportionate disclosure paragraph text directly next to your large, colourful call-to-action button and see how it affects clicks on that big, bright button.  In test after test that I’ve seen it doesn’t affect click through that much at all.  Why not?

Installing Clicktale on your lander will show you that users often scan the page quickly, scroll up and down a bit, and then click the big button.  Either that or they bail completely.  The odd person will stop to read, but if you’re a half-decent copywriter, your copy should be compelling enough to spur a click on the call to action button without the user simply zeroing in on the disclaimer or disclosure text alone.  In fact, such text has been known to increase the overall trust level of the page.

Extreme Examples of Disclosure Requirements Can Prove the Point

Here’s a couple examples where disclosure has been mandated by Government to an extreme degree…

Payday loans:  Individual governments have placed some fairly hefty disclosure requirements on short-term credit lenders for some time now.

Take for example the province of Alberta in Canada.  When a user selects their Canadian province here on the online application form requesting a payday loan, here’s what they see pop up in front of them:

How’d you like to deal with being legally required to pop something this clear up in front of your customers, blanking out their entire browser window?  And yet this company can still afford to compete in one of the most competitive local PPC verticals…Looks like they’re surviving just fine.

Another example: Big Pharma ads:

We’ve all sat through TV commercials for prescription drugs with 10 seconds of info about the drug’s benefits immediately followed by 20 seconds or more of FDA-mandated disclaimer and side effect information?  How awesome would it be to have to market your product in an environment where you’re required to fully disclose the most outside side effect possibility, even if that includes bleeding from the ears?

That’s not to say the disclosure requirements on Big Pharma are excessive at all, it just stands out as an example of the disclosure and disclaimer environment some marketers have to work in.  I’m sure they grieve that fact while crying themselves to sleep on a money mattress… Anyway…

Disclosure statements get even more conspicuous for Pharma when they do print ads:

The Bottom Line

The bottom line here is that Google is going to continue to be under pressure to make sure they reduce their legal exposure to advertiser behaviour and marketing through the Adwords system, and the sooner you get it all out on the table and start testing what will and won’t affect conversions and lifetime customer value the better.  If not, you’re going to wake up one day with Google telling you you can’t advertise with them anymore, or at the very least, what and how you’ll be disclosing material background to you customers.  Better to do the groundwork and testing now.

Prevent Previous Buyers From Seeing Your Google Remarketing Ads

Many remarketing campaigns use discount offer banners to try and recapture visitors who abandon the shopping cart.  For example they might ‘remarketing cookie’ bailout users and show them ads offering coupon codes or bundle offers – anything to get them back into a purchase.

The only danger with this however is that you might end up ticking off users who have already bought through the regular sales process at full pop.

To prevent this with buyers who come in via Adwords traffic, you can exclude “Sale” or “Lead” conversion audiences to your remarketing combinations.  Google uses their usual Adwords conversion tracking code that’s likely already on your ‘thank you’ as a ‘pre-configured’ remarketing list:  People who have bought or signed up already.  Handy.

Add Your Converted Visitors as a Remarketing List

Here’s how to create a remarketing list for people that have already converted (assumes you have regular conversion tracking already installed):

While in the Campaigns view in the Adwords UI, open the expandable left sidebar and at the bottom of the sidebar click “Control Panel & Library”, then select “Audiences”.

Now, create “New Audience” then “Remarketing List”.

We’ll want to name this list something that is familiar like “Adwords Buyers” , and we can reuse the existing conversion tracking tags (here called “Sale”) instead of creating a new tag:

Preconfigured Adwords Conversion Tracking Tags

This will allow us to give our remarketing campaigns special instructions about how to handle people who have already converted via Adwords.

Create a Negative Audience to Suppress Previous Adwords Buyers

Now we want to update our existing remarketing adgroup or campaign to exclude these folks.  I already have my Adwords-sourced site visitors in a remarketing list running inside an existing remarketing campaign.

I’m going to add them as a campaign-wide “Negative Audience” to ensure I don’t show discount offer ads to them after they’ve already purchased:

Now we’ll select our “Converted” list to the negatives:

That’s it!

Note:  This example bears out the importance of creating separate Display Network campaigns for remarketing.  The more granular you get in separating campaigns, the more targeted you can get in deciding who sees what ad as you grow out your remarketing efforts.

 

What About People Who Buy Via Microsoft Adcenter Traffic?

Google’s conversion tracking shortcut for reusing existing tags on your thank you page doesn’t work for suppressing remarketing ads against buyers from other traffic sources.

For that you’ll need to tag buyers from non-Adwords traffic via a new remarketing list and place those tags on your thank you page as well.

To create the tags for this, follow the same instructions above to navigate to your Audience lists.

Again we’ll create a new remarketing list from the “New Audience” button.

This time we need to create a new tag rather than reusing an existing one:

Now we can get the tag code to put on our thank you page:

 

 

Now we need to add these buyers are a campaign-wide negative list to our existing remarketing campaign as well (just like we did with Adwords buyers):

 

 

Done!  Now both Adwords buyers and those that buy via Adcenter or other traffic sources will be excluded from seeing our special offer remarketing ads.

 

 

Final Thoughts

Now it’s true that adding just the “Adcenter Buyers” remarketing tag to the thank you page and adding that list as a campaign-wide negative audience will prevent ANY buyers from seeing remarketing ads from this campaign, this example gives you as a reader a better idea of how Google’s conversion tracking can create list shortcuts as well as helping you not to forget about buyers from other traffic sources beyond just Adwords.

This also goes to show the importance of thoroughly thinking through your remarketing campaigns, trying to visualize who will see your ads and when.  Preventing people who have already bought from seeing your discount ads can save you a lot of grief.

That said, even buyers can come back for more, so you might want to think about what you could specifically market to people who have bought from you already.  Maybe you could create a custom remarketing campaign that just targets the buyers’ lists with ads encouraging them to sign up for a deals newsletter or your general mailing list.  Don’t waste the opportunity to keep selling!

The Display Network Spy Tool of the Future: What Runs Where

I’ve long felt that the market is ripe for a competitive spy tool that does what SpyFu and SEMrush do for search, but this time for the Google Display Network.

To be effective, such a tool should gather both image, flash, and text ads to give you an idea of who and what you’re up against when it comes to display network campaigns.

It should tell you:

  • What image and text ads your competitors are running on the Google Display Network
  • What landing pages they’re using with those ads
  • What ad networks they’re running display campaigns with, beyond just Google’s network
  • What companies your competitors are buying image ad inventory from
  • How a competitor’s ads have changed over time
  • What publisher sites your competitors ads are appearing on

And let you:

  • Export any and all ad data, in bulk, for offline review
  • Decide exactly how far back you want to look for ads that have shown on publisher’s sites
  • Specify the exact ad networks you want to scour
  • Search by niche keywords or specific competitor domain
  • Narrow your results down to the exact ad sizes and formats you’re most interested in

New Display Spy Tool: What Runs Where

Max from the new WhatRunsWhere service reached out to me last week with a demo of their new service that provides all of these features.  I realized later that I ended up spending over two straight hours researching and exporting competitor ads in a ton of different niches.  This tool is intense, the type of data you can grab out of here is invaluable.

Sidebar:  It’s a little known fact that I’ve been working with a friend to try and build a “content spy” network for a while now, but it’s a heck of a lot harder than it sounds.  We ran into server load issues, Google dodging and blocking the spider, delays between query and results and more.  Basically, we ended up with a tool that worked pretty well for one or two users at a time, but not for larger user loads.  Mike and Max at WhatRunsWhere seem to have worked around all of these issues.

Here’s a demo of how WhatRunsWhere works:  NOTE *The audio background is a bit loud, mute the sound if you want to just watch it in action, the narration is in subtitles:

Digging Deeper on a Competitor

If you want more intelligence on a particular competitor, after clicking their ad you get a menu like this:

Pretty cool stuff:)

Pricing & Competition

There are a couple of other tools out there attempting to do this, Adbeat is one, but according to a few people I’ve talked to that have used both, Adbeat doesn’t seem to have as much data and depth as WhatRunsWhere. On the flip side, WRW needs some UI polishing, but it’s easy to ignore that when you see the data you can pull.

WRW is priced at $249 for a month’s worth of usage, and that’s a one time bill: you get 30 days to dump out as much data as you like, then you’re done. For most advertisers, 30 days is enough time to get the data you’re after.

If you want to use the monitoring and change reporting features, they have a monthly deal for $229 a month.

Check it out and try it out here: WhatRunsWhere.com

Full Disclosure: The above link is an affiliate link. If you’re not ok with that, just type the URL into your browser. WRW is an awesome service and I don’t have any qualms about officially promoting it, but the choice is yours as to how you want to navigate to the site:)

Adwords Scam Email Alert

3 Comments Written on May 10th, 2011 by
Categories: Google Adwords

One of our community members posted about this this morning, definitely something to keep an eye out for.

The email is attempting to get you to login to a fake Adwords interface by submitting your Google Accounts login.

It looks like they’ve done their homework, the email comes from “adwords-noreply@google.com” and tries to scare you into logging into the fake UI as “your advertisements have stopped running”.

 

 

 

 

 

 

 

 

 

 

 

 

The fake Adwords interface they’ve built is pretty slick looking as well.

Quite a few advertisers have received this attempt today, it might be worth a heads up to your staff and clients to watch out for it as well.

How to Research Negative Keywords

13 Comments Written on May 3rd, 2011 by
Categories: Analytics, Google Adwords, Keyword Research, PPC Tools

“Negative” keywords are just as important as the ‘positive’ keywords you bid on.  Effective targeting of your Adwords campaigns requires that you put your ads in front of the right users, and keep them away from users who are unlikely to be interested in your product or service.  Many keywords have multiple meanings from niche to niche, others many apply to a particular area of your niche that your product may not want to target.

Poor broad-matching due to inadequate negatives can severely impact your keyword relevance quality scores as well as keyword-level quality scores are heavily measured based on ad click-through rates (CTR), and the more often your ad shows against irrelevant keywords, the lower your CTRs will be.

Different Kinds of Negative Keyword Structures

For search campaigns, negative keywords can be added either on a campaign-wide basis, or on an adgroup-only basis.

Here’s a good rule of thumb for which level of negative you should use:

If there’s no conceivable way that a keyword you’re adding as a negative would apply to ANY of the adgroups in your campaign, add it as a campaign-level negative.  If you only need to apply a particular negative keyword to one of your campaign’s adgroups enter it as an adgroup level negative.

Note: Negatives are not grouped into adgroups the same way positive keywords are. If you want to add a negative keyword to just one adgroup, you enter it like a standard keyword with a minus symbol (-) in front of it, and add it to the adgroup as if it was a positive keyword.

Locating Negative Keywords

Google has a pretty good idea of what keywords relate to each other.  Processing billions of queries per day, they can see patterns in what keywords are being used together, and what the searcher is looking for.

One easy way to leverage Google’s historical data on keyword combinations is by using the Google Adwords Keyword Tool.

For instance, if we’re advertising high-end custom car rims, we’ll want to add as negatives for products we don’t carry, or customers we don’t want (aka. people searching for “cheap”).  Additionally, we might be interested to see what additional terms Google says are commonly used in searches for our phrases (particularly when broad match goes bad).

You’re Not Going to Cover Every Negative With a Brand New Campaign

One of the most effective ways of isolating negative keywords can only happen after you’ve been running your campaign for a few weeks.  Google now provides much-improved reporting on users’ actual, exact search query.

Using the “See Search Terms” report when you’re on the adgroup’s Keyword tab can show you terms Google is incorrectly matching your keyword to.

Negative Match Types

Negative keywords can be entered with the same three match types as regular keywords: exact, phrase, and broad.

If there’s a chance that adding your keyword broad match negative (i.e. no quotes or square brackets) is going to limit your campaign’s ad impressions, you may want to get more specific in telling Google when you’re not OK with that negative.  With negatives, using the broad and phrase matching will prevent your ad from showing more than an exact match negative.

If the negative keyword is clearly off-topic, broad match is typically the best choice.

What’s your favourite method for digging up negatives?  Share them in the comments!

How to Boost Lifetime Customer Value

4 Comments Written on April 27th, 2011 by
Categories: Conversion, Marketing

As PPC gets more and more expensive in valuable markets, you may be looking at your niche and keywords and wondering “how on earth can they afford to bid this much???”.

The answer is usually one of these three reasons:

  1. They’re idiots and aren’t paying attention to their campaigns or keyword profitability
  2. They’re getting lower wholesale prices than you and have more margin to work with
  3. They’re not bidding based on a one-time sale (or lead) profit basis

Translation on #3:  They’ve figured out how to extract a higher Lifetime Customer Value from each PPC visitor or conversion than you have.

The first two are certainly possible, but, in the case of #1, that can’t continue forever before someone asks what the heck is going on, and with #2, this is happening less and less as competition drives inefficiency from any and all supply chains.

In my experience, the most common reason you’re getting schooled in high-priced PPC auctions is because your competitor is measurably better at making money “on the back end” than you are.

What is “Lifetime Customer Value”?

Simply put:  Lifetime Customer Value is the statistically valid amount of net profit each visitor or customer is worth to you in totality.  That “totality” could be 24 hours if you stink at building ‘after the conversion’ revenues, or it could be many, many years if you’ve built an enduring relationship with your customers.

Geordie Learns an Expensive Lesson

Here’s how I was first introduced to the concept of Lifetime Customer Value:

In my past life I sold OEM licenses of security software (antivirus, antispyware apps etc).  I wanted to get the biggest PC manufacturer at the time to pre-install a 30-day trial icon for our security software on their PC’s as they leave the factory (also fondly referred to by PC buyers as “the crap that came preloaded on my computer”).

I was willing to give the PC manufacturer a huge percentage of any sales that came through from these pre-installs (or a ‘revshare’ agreement).

The OEM guy at the PC manufacturer’s HQ that does these deals just would not return my calls or emails.  I was young and fearless at the time, so I just kept dialing, day after day.  Finally, one day he actually picked up the phone.

Here’s how the conversation went:

Geordie:  ”Hey Guy at Big PC Vendor, it’s Geordie Carswell calling, any chance you’ve had a chance to consider our proposal on pre-installs?”

Guy at Vendor:  Dude, listen:  Symantec gives us $250 per PC to install their Norton 30-day trial icon.  Can you afford to top that?

Geordie: “Um, what now?”

Guy at PC Vendor:  ”You heard me, $250.  They know their average customer will renew their software annually for AT LEAST six consecutive years.”

(Doing the math that worked out to a Lifetime Customer Value of about $414.00.  $250 bounty per install was well worth it.)

Geordie:  ”Thanks for your time and leveling with me, I’m going to go quit my job now. Cheers.”

It was a powerful lesson that I was thinking too linearly, I was trying to give him a high percentage of $40.  Symantec however had the data on renewal stats, the upsell and upgrade process down pat, and way more capital to invest in future business than we did.  Over time, we retooled our business model to incorporate new ways of increasing Lifetime Customer Value, but never could come close to touching Norton.

Simple Ways to Boost Lifetime Customer Value – Start with the “Thank You”

The quickest path to increasing Lifetime Customer Value is to use your confirmation or “Thank You” page for more than just thanking the customer and delivering confirmation messaging.

Your Thank You page gives you the best shot at reaching your best sales prospects:  They’ve already proven they’re willing to give you money or personal contact information, you have their rapt attention as they watch to make sure nothing went haywire with their transaction, and hopefully they have a ‘trustiness’ feeling for you in their tummies. So don’t waste this chance: Sell them something else!

One quick win is to conspicuously place an upsell offer on your Thank You page that (hopefully) allows the customer to order it without having to re-enter their payment information.  (Program your payment gateway to hold off on ‘capturing’ the transaction until they’ve decided if they want the additional item(s)).  It’s amazing how few merchants actually do this:  they’re great a ‘suggesting’ additional products prior to checkout, but after the order they drop the ball.

E-Commerce Revenue Booster: The “Bag of Crap”

If you’re in retail e-commerce, considering offering what my friend and keynote speaker Neil Patel calls “A Bag of Crap”.  (You might want to rename it something more user-friendly like “Surprise Grab-Bag”) The strategy here is that you don’t specify what’s in it, just that it’s “100% Guaranteed to be Worth Over 3x the Grab-Bag Price!”.

Next, stuff their order with whatever excess or promo items you might be wanting to unload anyway, just make sure the retail value promise is honoured (Great way to leverage clearance inventory!).  Price the “Bag of Crap” however you like while ensuring you build in some margin.  People love to dig through “Bargain Bins” in Walmart to find that under-valued, early Kurt Russell DVD for $3.99.  The principle here is the same: give them a chance to be pleasantly surprised.

LeadGen Cross-Promotion

What if you’re in the LeadGen business?  What can you do on your confirmation page to boost per-lead revenues?

The easiest one is to add an ala-cart menu of opt-in options for complimentary whitepapers, partner promotion offers, or trial downloads.  Let customers or prospects feel empowered to choose what they would like from the list, but make it worth their while by making the options genuinely sound appealing.

Additionally, why not run a contest or fun quiz on your lead confirmation page, perhaps inviting visitors to “See How You Stack Up!” after completing a survey or quiz that afterward shows them aggregate stats based on other responses, allowing them to compare metrics with others in their vertical or job role?  The options are really endless, have fun with it and increase the likelihood that when you call to follow up on web leads the respondent will have a warm-fuzzy feeling about your company.

Email, Email, Email!

While 98% of marketers admit that email marketing is a critical component of building longer-term customer revenues, few do it really well.  Why is this?

One of the biggest reasons is that they haven’t thought far enough ahead.  Often email marketing falls into “Blast mode”, where emails to customers are blasted en masse without any prior email-based relationship having been developed.  As a result, the user gets the email and, in the best case scenario doesn’t remember who you are and deletes the email, and in the worst case scenario hits the “Spam” button.

If a user has given you their email address during a transaction, include a strong call-to-action that will motivate the customer to double-opt in to your email marketing list.  What’s ‘a strong call-to-action’?  It’s a heck of a lot more than “Sign up for our Newsletter!” with no explanation about what they’re going to receive if they do sign up.  That’s simply not effective.  Come up with some goodies or immediate deliverables that they’ll get ‘in exchange’ for their double-opt in. Make it worth their while!

Once you’ve added them to your marketing email list, don’t just let them ‘languish’ there until you do your next “Blast”.  Set up an auto-responder series with actual, tangible value  that will build that warm-fuzzy feeling for you in anticipation of your upcoming campaign-based email drops.  Email marketing lists are like cars, they take a while to warm up:)

“Like Us on Facebook” Sucks

If Groupon has proved anything, it’s that email marketing kicks “social media” marketing all over the place when it comes to e-commerce conversions.  People tend to (at best) skim commercially-fueled social media posts, but they pay a comparatively larger amount of attention to their email.  (Yes, I know ‘Millennials’ don’t use email blah blah blah, but chances are they’re not your target market, people with money are.)  Attention and engagement are the twins that drive revenues and email simply delivers more revenue than social.

That’s why I cringe when I see “Like us or Find us on Facebook” on Thank You pages or email correspondence.  Nine times out of 10 when you “find them” on Facebook, you find a slightly branded, half-assed Facebook Fan Page with zero mechanisms baked in to drive Lifetime Customer Value.  No upsells, no engagement opportunities, no anything of value.

Some brands are skilled at continuing the conversion flow on their Facebook Fan Pages (or whatever they’re called now), but if you haven’t got a definitive answer for what Facebook (or Twitter, or social-whatever) is adding to your Lifetime Customer Values, chances are it’s not that much.

Focus on what will move the needle revenue-wise, and I’ll bet that turns out to be upsells, cross-sells and email marketing.

PS:  If you do ask a user to tweet or post about you on their Facebook news feed, make it easy for them by providing suggested text (that sounds conversational and not too ‘salesy’) and link it to something that will actually drive revenue, not just a dump to the homepage.

Ask for Referrals!

Sales 101 says:  ”Ask for the sale!”  The same principle applies with building additional revenues on the back-end of a transaction or lead:  Any time you interact with a customer, be that a sale, an email, a support response — anything, ask the user for a referral.

This could be as simple as a “Email this to a Friend” option on your Thank You page or, better yet, let them send a discount offer with their own text input to a friend(s) making them look good for ‘sharing a deal.’  (Important: Make it a GOOD deal, something people would WANT to share – Don’t cheap out!)

Why not run a contest for referrals?  Or offer a discount to existing customers if they get a friend to place an order or sign up?  A big part of the reason Dropbox has grown so quickly is because of existing-user discount referrals. The bottom line is that you need to ask people to do what you want them to do. Sitting back and hoping word of mouth will happen on its own and boost your per-customer revenues just isn’t going to cut it.

These few examples are only the tip of the iceberg in ways to boost LCV: What are some of the best examples you’ve seen to date on building Lifetime Customer Value?  Share them in the comments!