The first and possibly most important step of any paid search program is to define and understand your customer. It’s not only critical that you understand their demographic information, but it’s equally important to understand their online purchasing process and what search terms they use during that process.
This understanding of a customer’s intent can lead to creative ways of managing a paid program or can influence how you establish the program’s structure. For instance, more attention can be placed on a customer who uses a high intent search such as “home insurance in Minneapolis” than on a customer who shows low intent, such as “cost of home insurance”. Below is advice on how you can target these different customers and improve your return on ad spend.
Tip #1 – Budget Analysis
At its core, Paid Search is best at delivering conversions from customers that have a high intent to buy. This reality is why we recommend businesses allocate as much of their budget as they can to targeting keywords that have higher intent and are typically the last step in a customer’s path to conversion.
Let’s use the insurance example again. We can tell someone is higher in the buying cycle if they are searching using general terms such as “insurance” or “benefits of insurance”. These users are not actively browsing, but considering whether to buy. Next, we might see users shopping around using terms such as “price compare” or “reviews”. This tells us they are visiting different websites to decide which fits the bill. Finally, when someone has made the decision to purchase, they might search for a specific brand, or with a geo-modified term to find the insurance provider near them.
If campaigns are restricted by budget, it is then appropriate to allocate more budget to high-intent campaigns that are focused on driving conversions.
Tip #2 –Keyword Segmentation
The keyword research process is vital to any paid search program. After it has been decided what keywords will be used to drive your program, we recommend dividing keywords into groups based on customer intent. This can be hard to gauge and you won’t get it correct the first time, but as is with most facets of paid search, you can always test and modify at a later date.
These keyword groups can be used to structure your paid search program and to take advantage of targeting customers at the different stages of their buying cycle. You can also control your budgeting for these targets and easily execute any number of different strategies to meet your determined program objectives.
#3 – Strategy Examples
There are a variety of different ideas that can be executed by separating your search terms by customer intent. A couple of examples are:
You can control demand by running your high intent keywords on days of average traffic, while on days with slow traffic, you can turn on keywords that have lower intent to try to minimize the effects of low volume. An effective means to discover high/low volume keywords is via Google Trends.
You can also employ search remarketing tactics where you use the low intent keywords to cookie interested users. While these users may not be ready to buy, you can show them ads throughout their buying cycle so your brand remains top of mind for when the moment of purchase does happen.
#4 Finding a Balance
Once a program has collected enough data, then optimization towards optimal performance can take place. It’s important to note that while high intent keywords can lead to high conversion rates, they also come at a premium cost-per-click because they’re highly competitive terms. Low intent keywords will most likely have low conversion rates, but because of a lack of competition they can be quite affordable.
For example, a high intent keyword may cost $15.00 per click and convert 50% of the time for a cost-per-conversion of $30. While a low intent keyword might only convert 10% of the time but only costs $2.00 per click for a cost-per-conversion of $20. Every keyword is different and must be optimized accordingly.
Identifying customer intent and advertising to them differently during their purchasing process can lead to great gains for your paid search program. It allows you to see the full picture and to balance which targets perform best.
Have questions about this or curious how your program currently interacts with your customers’ intent? Get in touch and we’ll share our insights for your particular needs.