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May 02, 2013
Case Study

PPC Marketing: Two accidents reduce cost per lead 20%

SUMMARY: In today's B2C case study, we look at why a landing page underwent a major redesign, challenging the prevailing conventional wisdom about the customer. After a couple of mishaps with paid search campaigns, the team at firstSTREET also gained valuable learnings about how Google and Bing/Yahoo perform for its audience. The team customized its PPC messages and increased the PPC budget, while driving cost per lead down by 20%.

Steve Parker, Vice President, Direct Marketing Division, firstSTREET, presented this campaign at Optimization Summit 2013.
by David Kirkpatrick, Senior Reporter

CHALLENGE

firstSTREET's target audience are baby boomers, and its primary marketing channels skew toward the more traditional — print ads, direct mail, package inserts and Yellow Pages.

Even though the marketing focus is on traditional channels, firstSTREET also maintains a Web presence and is active in digital marketing. Steve Parker, Vice President, Direct Marketing Division, firstSTREET, also regularly conducts testing and optimization on those digital marketing efforts.

Last year, we presented a case study on one of Parker's radical webpage redesigns that led to a dramatic lift in sales.

This case study is a little different. It illustrates how it's possible to gain important marketing insights when things donít work exactly as planned.

Read on to find out what went wrong, what firstSTREET learned from that setback and how Parker's team ended up increasing pay-per-click advertising spending three-fold, and the cost per lead dropping 20%.

CAMPAIGN

The product for this marketing effort was a walk-in bathtub from the Jacuzzi brand. Brand recognition for the target audience was very high, and the purchase was fairly expensive with installation exceeding the cost of the product in many cases.

Step #1. Develop the initial marketing strategy

Because the product was expensive, the marketing strategy was a more complex sale than many of the company's other consumer transactions. Parker described the process as a "lead generation game."

Along with the traditional marketing channels, PPC advertising was part of the overall strategy. The messaging was focused on safety. Parker understood seniors are concerned with safety in their home, with falling being a particular concern and most of those falls happening in the bathroom.

Also, studies show seniors prefer to remain in their homes as opposed to moving to assisted living.

All of that target audience knowledge informed Parker's idea of messaging around safety in the PPC ads and on the landing page.

The three main drivers of traffic to the landing page in order of importance were PPC advertising, organic search and referrals from the Jacuzzi website.

Step #2. Accidents can happen, but make sure to learn from them

For the PPC campaign, firstSTREET was advertising through Google and Bing.

Two accidents involving paperwork issues happened with each PPC vendor causing the ad campaigns to temporarily end on each platform separately.

Obviously, this is not a situation any marketer wants to face, but Parker obtained a key learning from having his Google and Bing PPC campaigns end arbitrarily and at different times.

"What we found out [is] we have a disproportionately effective response out of Bing than we do out of Google," he said.

Parker said he understood the typical industry split was 80% Google and 20% Bing in paid search, but for firstSTREET, that split was closer to 50/50.

The company's data showed AOL was the best driver of organic traffic conversion on the website. Given that, Parker understood his customer base — seniors — probably were PC users who relied on the default search engine on their computer. In this case, Bing.

Even though Parker wasn't able to clearly prove why Bing paid search was driving more than the expected traffic, the two mishaps with two PPC vendors provided firstSTREET with valuable insight into how to market to its target audience.

Step #3. Be willing to change your value proposition

Learning Bing was performing at a disproportionate level compared to Google in paid search was a key insight on a tactical level. At the same time, Parker was testing the value proposition for the walk-in tub and uncovered another major finding for messaging.

The initial strategy was branding the paid search campaigns and landing page around the idea of safety, appealing to a known concern for the target audience of seniors.

Parker listened to firstSTREET customers and found a more effective message.

"Like most good ideas, they come from the consumers," he said. "They don't come from all of us sitting around in our ivory towers."

Parker said he spoke with firstSTREET's sales team and people who've actually installed the walk-in tubs, and found out the Jacuzzi brand resonated with the target audience and was actually a selling point.

firstSTREET's customers were viewing the walk-in tub as more than a bathroom fixture.

The result of this insight was a redesigned landing page emphasizing the brand, and new messaging for the paid search campaigns.

The value proposition for the marketing message changed from a focus on safety and health to a focus on luxury based on customer insight gained from speaking with people who directly dealt with those customers.

Step #4. Tailor PPC campaigns for each vendor

Parker said it's easy to simply replicate PPC advertising across different platforms, but that it's worth the time and effort to tailor campaigns for different vendors.

"Bing is important enough to us that we actually care about the differences between Google and Bing," Parker explained. "Our best ad isn't the same on Google and Bing."

He said:
Several factors contributed to our fast-growing PPC spend:
  • We're not budget constrained in absolute terms. We'll take all the good quality leads we can get at an acceptable cost per lead, assuming the lead conversion to installed tubs stays the same. Many marketers are constrained to a fixed budget amount and focused on efficiency of that spend. We're focused on effectiveness and profitable growth increase.

  • Every time we meaningfully increase the conversion rate, our cost per lead and cost per sale go down. This lets us chase the next level of keywords and other cost-per-action media that was borderline or slightly above our target prior to the conversion rate.

  • Our learning about Bing/Yahoo's performance relative to Google certainly boosted spending. We had started using Bing well prior to this case study.However, it was getting very little attention.

Step one was just paying more attention to Bing than simply porting over the best Google campaigns and putting them on auto-pilot.

Step two was leveraging the higher response rates and lower cost per lead to be more aggressive on Bing than on Google. This affects keyword breadth, bidding strategy and is just starting to affect campaign themes.

Step three, which is a work in progress, is looking harder at what Bing offers relative to Google and taking advantage of their unique capabilities. This includes some targeting capabilities, testing creative differences and generally treating them as equal to Google in importance.



RESULTS

Because paid search was the key driver in landing page traffic for this product, there were two key metrics around this effort:
  • After gaining insight into what really worked, PPC campaign spending increased by three times

  • Even though spending went up, cost per lead went down 20%

Another important result was even though digital marketing takes a backseat at firstSTREET simply because of its targeted senior citizen customer base, Parker said this effort proved the website can also drive conversion to sale.

And, interestingly, once Parker gained insights in the value proposition of the product and was able to quickly test and validate those learnings on the website and in PPC campaigns, those insights were applied to firstSTREETís print advertising as well.

And, about those accidents leading to important insights into firstSTREETís paid search?

Parker said, "You know, ignorance is bliss, but itís not good for your business."

Creative Samples

  1. Original landing page

  2. New landing page

Source

firstSTREET

Related Resources

Optimization: A discussion about an e-commerce company's 500% sales increase — SherpaWebinar replay

Landing Page Optimization: Radical redesign leads to 3,566% increase in conversion

The WOW! Computer: How firstSTREET applied a radical redesign to deliver a 500% sales increase [Full session from Optimization Summit 2012]

5 Steps: Customize Paid Search by Targeting Userís Operating System

PPC Marketing: A look at analytic and monitoring tools


See Also:

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