June 27, 2019
Engage With Qualified Users by Giving Them Your Best Content
First, let’s talk about what automated bidding is and why it works. Historically, you’d adjust keyword bids based on direct performance, like conversion rates, as well as secondary factors like performance in New York. You’d make these adjustments manually based on savvy analysis. Well, automated bidding strategies make those changes…automatically.
Why is automated bidding so powerful? Because manually you are not able to analyze every piece of data available. Typically, you make manual bid adjustments based off of a handful of data points, whereas automated bid adjustments are made off of thousands of data points – all in real time and for each search auction.
Automated bidding strategies are not perfect, especially for lead generation campaigns. The goal of the automated bidding strategy is simple: drive as many leads as possible within your budget or target CPL. There is inherently a major problem with this underlying goal – generating leads is not the goal of the business. The goal of the business is sales.
Lead generation is a means to an end but not the end. Writing an ad that says “Enter your name and email and get $100,” would generate plenty of leads but probably wouldn’t generate many sales qualified leads.
Let’s look at a specific example. Your company sells enterprise financial software. An automated bidding strategy notices that leads are cheaper in residential areas than in major business districts, so it starts increasing bids in those areas. You see that this strategy drives more leads but fewer SQLs than before as more of your leads are from small businesses. The automated bidding strategy thinks it’s a hero, because it’s driving more leads at a lower cost. Nevertheless, the impact on your business is ultimately fewer closed deals – not ideal.
So does this mean you can’t use automated bidding? No! But it does mean you can’t “set it and forget it.”
This is where proper UTM implementation becomes essential! The most straightforward solution is to import a lower funnel action into the bidding platform rather than relying on general conversion tracking. The concept here is that the bidding platform no longer views general leads as the goal but rather SQLs. As our goal and the goal of automated bidding are now in line, any improvement in lead volume or cost reduction will drive real value for the business.
Unfortunately, this solution can be very technical, time-consuming and error-prone. So what can you do right now to see if automated bidding is hurting or helping?
The quickest way is to compare where your SQLs are coming from with where your leads are coming from. Are you generating tons of leads in Texas, but only a few SQLs? Does New York generate the most SQLs while California and Texas have the biggest spend? Does the “bookkeeping software” keyword generate hundreds of leads but no SQLs? The goal of this analysis is to identify areas of dissonance between where you are spending money and where you are generating SQLs.
You can then use this data to make manual adjustments or limits on automated bidding. Then, the automated bidding strategy looks for the cheapest lead it can drive within your adjustments, bringing it back in harmony with your goals. For example, you could create two campaigns with one targeting high performing states and the other targeting the rest, allowing you to set different target CPLs or allot different budgets.
Automated bidding strategies eliminate a lot of time-consuming analysis while also producing great results. However, they are only as strong as the data they have access to. Contact us to learn more about homing in on lead quality when utilizing automated bidding.