Updated: Google Testing Cost-Per-Lead in AdWords

Google is testing search and display versions of a cost-per-lead ad format that would allow users to request an advertiser contact them. The company confirmed a display test after a political controversy arose surrounding the AdWords feature, and declined to comment on a search test.

Other than acknowledging that the display ad test was happening, and tacitly confirming that it was appearing on Google Display Network sites, Google wouldn’t provide further information on the display ad test. Presumably it also allows users to input their contact information. As for the search test, a report by WebRanking pointed to an authentic-looking confidential Google document from February posted on Scribd, which explains the new search ad format to potential alpha testers.

Images from apparent leaked Google presentation on Communication Extensions

When I asked about the test, a Google spokesperson told me, “”Google constantly tests new features and extensions in AdWords in order to improve our product offerings and provide additional benefit to our users and advertisers. We have no news to announce at this time.”

According to the document, the new AdWords “Communications Extensions” offers users the opportunity to request a phone call or e-mail from the advertiser. A cost-per-lead ad would be particularly useful for advertisers in business-to-business, or in any category where buyers require a lot of nurturing before they’re ready to make a purchase decision. Google has sold cost-per-lead ads to financial services companies previously, through what’s now called Google Advisor.

According to the presentation, Google isn’t actually sharing individuals’ phone numbers or e-mail addresses with advertisers. In other products, like its Comparison Ads for financial services clients, Google anonymizes the user’s phone number or e-mail address before sharing the information with the advertiser. With calls, advertisers get a special phone number to dial, and then they enter in a code to be connected with the person who requested the call. After 30 days, the code expires. A similar forwarding e-mail address is used for e-mail leads. Presumably Google would follow the same approach here. (Here’s Google’s FAQ item for “Communication Ads” from the consumer privacy perspective.)

These cost-per-lead ads could be a substantial revenue-driver for Google in any high-consideration category, but one challenge will be making a text ad compelling enough to encourage a user to give up their e-mail address or phone number — even if it won’t exactly be shared. It also remains to be seen how well consumers will understand, and therefore trust, the anonymization process, given that it involves more technical processes like e-mail and call forwarding. Advertisers will also have to grapple with the fact that they can’t contact these leads on an ongoing basis without soliciting their real phone numbers or e-mail addresses upon making contact — this will likely be one main goal of advertisers following up on leads.

Note: This story has been updated to reflect that Google appears to be testing both search (text) and display versions of cost-per-lead ads, though it’s released differing amounts of information about each type of ad.