September 11th 2017

How to get customers in crowded markets + A bonus Adwords audit!

Image Dylan Touhey

Hard Truths + Remedies for SaaS Marketing: Part Three

This is the third post in my "Inflections" blog series where I lay down the hard truths and remedies for SaaS marketing. To start from the beginning,click here.

Today, let's kick things off with a quick audit you can conduct on your AdWords account to make sure your campaigns actually make money. Sounds fun, right? Then, we'll follow up with tips on how to how to differentiate yourself in crowded markets.

DIY AdWords Audit

Are you bidding on less than 100 keywords?

Lots of companies tend to make this mistake. When we run campaigns for SaaS companies, we typically bid on thousands and thousands of keywords. If you are only bidding on a handful of keywords, you may not get the right data or get in front of the right customers.

Are you using negative keywords?

Your negative keyword list is almost as important as your keyword list. One useful tip is to be cautious of the keyword "jobs." For example, if you are bidding for "project management software" make sure you add "project management jobs" as a negative keyword. If you don't you'll be paying for job searches or recent college grads exploring the idea of being a project manager.

"What's his problem? Can't he read his own sign?!"

Use Google Analytics to start your negative keyword list. Analytics will show you the keywords that send poor traffic to your site with high bounce rates. You can add to your negative list as you track the ROI for each keyword. Your negative keyword list should be constantly evolving.

Are you starting at the keyword head or tail?

If you only have a small budget, make sure you begin by owning the keywords with the most buying intent. This is why thousands of keywords are better than a few dozen. For example, "project management tools" is a very broad search. Don't begin there. Instead, focus on winning bids for searches like "alternatives to {YOUR BIG COMPETITOR} ." It makes no sense to get broad coverage until you exhaust the searches with high buying intent first.

Bonus: If you are spending more than $1,000 per month, consider hiring a professional to manage your account. Paid search is a very effective channel, but it requires dedicated mastery of new features and nuances. You can't master everything! At the very least, implement the above tips.

Keywords aren't the only way to use online advertising to your advantage. I'll share some further insights my agency has learned.

How to get customers in crowded SaaS Markets

We work with several tech clients in crowded marketplaces including network security, accounting, finance, machine learning, telecom, hardware and even ad tech.

One of the biggest marketing challenges we see in a crowded marketplace is the amount of advertisers competing for the same keyword phrases.

Here are some things that have worked for us.

Move to Product Listing Ads

Product Listing Ads (PLAs) are not limited to eCommerce sites. As a SaaS company, you can create different products from your subscription tiers.

When running paid search ads in a competitive environment, by moving to PLAs, we are able to improve our campaign KPIs dramatically. This is likely due to fewer advertisers using PLAs, resulting in lower CPCs and higher CTRs. Here are some highlights that we saw when switching one of our online retailer clients over from regular text ads to PLAs:

  • 20.40% increase in clicks
  • ~3x increase in CTR, from 0.31% to 0.89%
  • 59.90% decrease in CPCs
  • 45.70% decrease in costs per conversion
  • 51.70% decrease in overall account costs (while maintaining comparable conversions and an increase in clicks)

*Hint: Google has openly stated that ads with PLAs get higher quality scores than those without.*

Bid on your branded terms

Many online retailers don't bid on their own branded terms in AdWords or AdCenter for a couple of reasons:

  1. It seems like a waste of money.
  2. Their organic listing will rank first regardless of whether they are running paid search ads for that branded phrase.

But...you've worked hard to build your brand. So you want to be the one who profits from those searches, not affiliates, or competitors.

The solution? Create a separate campaign in AdWords and/or Bing Ads and bid on your own branded keywords.

You'll find that your CPCs are extremely low, CTRs are extremely high, and your costs per conversion will be substantially lower than your other paid search campaigns.

Here are some highlights we have experienced with one online retailer's branded terms campaign metrics, compared to their aggregate AdWords account metrics:

  1. 54.17% decrease in CPCs
  2. 300% + increase in CTR
  3. 5x decrease in costs per conversion

Just because someone searches for your brand doesn't mean they are a customer yet. They could be simply researching you after hearing about you from a display ad, social media, or blog post.

Focus on big wins and try not to sweat the rest

Does "Sign Up Now" convert better than "Start Free Trial"? Does "No Credit Card Required!" get more clicks than "Free Support"?

It probably doesn't matter.

Unless you're running massive campaigns and have already exhausted every other angle, focus instead on testing different key messages and refining your positioning rather than agonizing over microscopic copy hacks.

Muscle-out your competition by outbidding them

Another paid search tactic for bidding in a competitive ad marketplace is to simply outbid your competitors. The goal here is to bump the smaller competitors down in ad rank who may not have the budget to compete. Do this as a loss leader if you have to. Measuring lifetime value will soften the blow of the immediate loss on the initial transaction.

Bid with Lifetime Value in mind

When you build up enough metrics to discern how many transactions a customer makes throughout their lifetime in your product, you'll realize that determining your paid search success around a single (first) transaction can be short-sighted.

As an example, a SaaS company in the ad tech category may have a CPC of $3.00 with a conversion rate of 5%. Compare that price tag with a subscription price of $20.00 per month and an average customer life span of 16 months. At first glance, their ad campaign is not profitable because it will take $60 to drive an initial transaction of $20.

However, if they factor in lifetime value, the campaign becomes highly profitable because it only takes $60 to generate $320 in lifetime revenue.

For SaaS companies, Lifetime Value is very important. Master it. Master it along with these other online advertising tricks and you'll see results.

Categories: ALL, Marketing

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