B2B search advertisers must confront an annoying paradox. For most advertisers the billable event is the click. Yet for most B2B advertisers success depends not on clicks, but rather on conversions: the percentage of visitors who take the desired online action, such as downloading a white paper or registering for a webinar. B2B marketers must weigh the pros and cons of focusing on response rate versus conversions.
Quantity of clicks vs quality of conversions
Many search marketers run their campaigns to maximize the volume of prospects driven to a website. The idea is, load more prospects into the top of the funnel, and more sales will be generated at the bottom.
B2B marketers don’t necessarily think this way. For many of us, it’s not so much about the quantity of clickers as it is the quality of converters.
B2B clicks are more expensive than B2C
B2B search advertisers pay, on average, a bit less than $3.00 per click ($2.77 on Google, according to Marketing Sherpa’s 2006 Benchmark Report). This is more than twice the average cost for a consumer product click ($1.36).
$3.00 might not seem unreasonable, but some B2B firms advertise in highly-competitive sectors where click costs are in the $15 to $40 range! At this price, it’s important to convert as many visitors as possible into action takers.
Using ad copy to pre-qualify clickers
When faced with a limited pool of potential buyers, and when each click comes at a significant cost, B2B search advertisers must do everything they can to pre-qualify clickers to reduce the number of clicks coming from searchers who will simply not complete the conversion process.
Ad copy is a powerful tool that can help you accomplish this pre-qualification step. This may seem challenging, but even within the limits of ninety-five characters, advertisers can send strong signals about who should and should not click on an ad.
Reducing response rate
Unlike B2C ads, where generally it’s the more the merrier, any B2B search ads are actually designed to reduce response rate. For example, I work with a company in the IT Outsourcing sector. Here are two ads we recently tested.
IT Outsourcing Service
Reduce costs. Improve reliability.
IT Outsourcing Resource Kit.
IT Outsourcing Provider
Serving firms with 20 – 300 users.
IT Outsourcing Resource Kit.
Ad #1 is fairly general and focuses on user benefits and a call to action. Ad #2 specifically describes the target audience.
The first ad had a 5.6% click-through-rate (CTR). Ad #2 was much lower at 3.1%.
The Quality Score trade-off
The second ad, with the reduced CTR, will receive a lower quality score than Ad #1 (all other things considered equal), resulting in lower ad position for the money.
Why would a marketer purposely lower CTR, and thus impair the Quality Score? The answer lies in conversion rate and cost/conversion. Our client discovered (through an online survey) that many people who clicked on Ad #1 were too small to qualify for their service (companies with fewer than 20 users). Not surprisingly, clickers from these smaller companies never converted into qualified prospects or leads. For this reason, the generic ad had a much lower conversion rate than the pre-qualifying ad.
Based on this, the IT Outsourcing company decided to test multiple versions of only the pre-qualifying ad copy—thus lowering CTR and Quality Score—but ultimately improving conversion rate and cost/conversion.
The balancing act
Current Quality Score algorithms, based partially on CTR, penalize B2B marketers who use ad copy to pre-qualify clickers. B2B marketers must evaluate the pros and cons of maximizing response rate versus maximizing conversions.
If your campaign is focused primarily on lead generation (versus brand building or market positioning), or if clicks are especially expensive in your category, or if you are trying to reach a very specific, fairly small niche audience, I recommend using ad copy to pre-qualify clickers—even at the expense of lower CTR and Quality Score.
All this might change in the future of course, if ad networks move toward cost-per-action models (as many predict). But, for now, I advocate the “Don’t Click Here” method for most B2B search advertisers.
Opinions expressed in the article are those of the guest author and not necessarily Search Engine Land.