Paid Search For Lead Generation – Tracking Revenue For A True ROI

In this article, we’ll take a quick look at what paid search is and why it’s good for lead generation, as well as your digital marketing strategy – then we’ll dive into which elements you should track and why.

Lead generation through paid search (PPC) is essential for businesses aiming to convert interactions into revenue. This involves placing ads in sponsored spots on search engine results pages, ensuring high visibility for relevant queries. 

Research shows that traffic generated through PPC ads has a 50% higher chance of converting than organic traffic so, if you want to generate leads for your business, paid search can be a highly effective tool. 

When you’re a business looking to drive sales and growth through paid search, we know that every penny counts. It’s important to be able to track the revenue of your campaigns so that you can report back to key stakeholders on the ROI of your campaigns. 

In this blog, we’ll take a look at how you can use paid search for lead generation and how to track the revenue of your lead generation campaigns. 

What is paid search?

Paid Search for lead generation allows you to place an ad within one of the sponsored spots on the search engine results pages. This is achieved by paying only when that ad is clicked (known as PPC). Search engines such as Google, Yahoo and Bing allow you to pay to ensure that your brand appears at the top of the search results when customers are searching for relevant terms to your products and services.

These ads, which display at the top of the results page, look just like regular search engine results, with the exception of a subtle ‘ad’ next to the website domain, which lets users know it’s sponsored. 

Some of the key benefits of PPC lead generation include: 

  • Targeted advertising: Reach your ideal customers based on specific keywords, demographics, and locations. 
  • Measurable results: Track clicks, conversions, and costs to measure the effectiveness of your campaigns. 
  • Scalability: Easily scale your campaigns based on performance and budget. 

Why use PPC for lead generation (and how does it work)?

It’s a common myth that PPC is only for e-commerce businesses, but that’s not the case: it’s an effective tool for businesses looking to generate leads too. 

Lead generation is best suited to businesses that either have a long sales cycle, they need to filter potential customers before doing business, or they attract customers online but complete sales offline. This can be particularly common in the B2B sector. 

These customer journeys can be longer than the typical B2C journey in which customers are buying a simple product, sometimes taking upwards of a year or more. 

As a result, lead generation should be seen as a continual process whereby leads regularly enter the top of your sales funnel and work their way down. However, finding a constant stream of leads can be tricky - and that’s where PPC comes in. 

For lead generation, PPC sits in the ‘reach’ stage of the sales funnel. Once you’ve got the leads there, they enter a process that involves both the customer and your business getting to know each other better with the aim of securing a sale or action. 

Tracking the customer journey to understand the ROI of lead generation 

You’ve heard the saying ‘all roads lead to Rome’. This means all methods of doing something doing something will lead to the same result. Sadly, when it comes to sales, this just isn’t true! Some roads lead to a sale, other lead…well…nowhere. 

Mapping out your customers’ various journeys can provide helpful insights into what’s working and what’s not. Tracking the full journey also allows you (and advertisers) to fine-tune your digital marketing campaigns based on factors that lead to a better ROI. 

When it comes to tracking your marketing efforts and ads campaign, we need to ramp up what works and kill what doesn’t by fine-tuning campaigns. 

How do micro-conversions work for lead generation ROI? 

Macro-conversions are the ultimate goal for any business. For an e-commerce site, it could be a sale. If you’re a security expert, double glazing specialist - or anyone else who conducts sales offline - your macro-conversion will be when someone requests a quote or calls your sales team, usually via your website or over the phone. 

However, for B2B businesses or others with a longer sales cycle, it’s rare for a customer to leap straight into the sale or booking. Have you ever clicked on a banner ad and bought from the site immediately? 

Instead, the customer journey is typically made up of lots of little steps that lead to the macro conversion. These little steps are known as micro-conversions.

Here’s a very basic example of a customer journey made up of micro-conversions that eventually lead to a macro conversion: 

  • Signing up for a newsletter
  • Following your brand on social media
  • Visiting specific pages
  • Allowing push notifications
  • Downloading a whitepaper or eBook
  • Watching a video
  • Sharing a post

Why are micro-conversions important?

Very few people buy something the first time they visit a website - and this is especially true for B2B purchases. This is where measuring your micro-conversions can be useful: it helps you understand your customers better and ensure that your digital marketing campaigns provide the right messages and reach the right people. 

Here’s an example of a customer journey made up of micro-conversions that eventually lead to a macro conversion: 

  • Click a paid search ad on Google
  • Land on an optimised landing page
  • Downloads a brochure (micro-conversion)
  • Receives a series of relevant emails
  • Return to site
  • Calls the sales team (Macro-conversion)
  • Sale is completed offline

Seeing how your customers behave at each stage of this journey gives you the opportunity to see how they interact with each of the touchpoints they have with your business - whether it’s a paid search ad (which you can test), or your website. 

Here’s an example.

A quote request might be part of your conversion funnel. Looking at your website’s analytics could reveal that people are dropping off at this point - which could indicate a problem with your form. You can then examine it to see what needs to be improved and fix the situation. 

Another example 

You have a paid search ad that’s not converting - running A/B tests on the copy could give you a better idea of what resonates with your target audience (and what doesn’t). 

Why you should track revenue against conversions (and how to do it)

Goal completions (or micro-conversions such as newsletter sign-ups or brochure downloads) are important, but they’re not enough. You need to track revenue too, this shows you which efforts are most profitable. 

For example, imagine you’re a business that’s seeing great results from your lead generation activities. You’ve generated lots of leads which looks great when presented to your stakeholders. However, if most of those leads are low quality, ROI will be low. 

The solution?

Track your revenue. To do this, you need to look at your sales, then work backwards and follow the customer's journey back to the ad or keyword that brought them there. This shows you the full customer journey so you can see how they got where they did.

You’ll then need to split your customers into groups. Why? Because some will be more profitable than others. For example – those coming to your site from a job site backlink may just be looking for career opportunities. It’d be a waste to focus your marketing efforts on them since it’s unlikely they’re going to buy from you. Focusing on the customers most likely to convert helps you fine-tune your marketing efforts, saving you time and money.

Once you’ve identified your most profitable customers, nurturing them throughout their journey is important. This means understanding what their route could look like and matching your messaging to fit. For example, you could send new leads discount offers to entice them towards a macro conversion, aka sale.

An example of a micro-conversion nudging customers towards a conversion.

What’s the best way to track the customer journey?

If you’re an eCommerce site, tracking the full journey can be done using marketing automation tools. Different traffic sources – like keywords and PPC ads – produce different revenue and lifetime values. It’s important to track these to accurately calculate your ROI from different sources and fine-tune your campaigns accordingly.

This can be done by capturing the Google Click ID (GLICD), which can be sent as a hidden field to the sales team. Other customers can be tracked through live chat and phone calls, which should also be measured.

If part or all of your customer’s journey is done offline—for example, you sell from a showroom or over the phone—then you need to track offline sales to get a full picture of your ROI. This comes down to data collection and organization.

Here are some ways to track offline ROI:

  • Track phone calls: Use different phone numbers for different advertising routes so you know that every call that comes through on a specific number engages with your offline advertising efforts.
  • Track emails: Using the same method above, dedicate a specific email address to a specific ad campaign to see which one is bringing customers your way.
  • Use offline brand tracking tools: such as Adalyzer, to see whether there are any trends or spikes in customer activity when your radio or TV ad plays.
  • Use promo codes: Not just limited to online sales, these can help you track your customer’s journey back to a specific route or origin. Whether your ads are in a newspaper or on the radio, discount codes will help you work out which customer came from where.
  • Share data between departments: Customer service teams, sales, and marketing should communicate regularly to share their data insights. Once you have your data, you can collate it to fully understand your customer’s journey and experience.

While leads look great, if they’re not generating profits, you will run into a problem. The takeaway? Track your customers’ journey and the revenue for a true picture of ROI.

Top tips for tracking your revenue

There’s no right or wrong way to approach this, but there are things to consider if you want the best results.

Be organised

Planning is key to running a smooth, organised project. Customer Relationship Management (CRM) processes help you streamline your lead management. Usually done on a spreadsheet or project management tool, it involves tracking prospects, including who you’ve spoken to, how many times, their responses, etc. Without it, things can just feel a bit… messy.

Consider the lead time

Lead time (from lead to final purchase) should be considered when tracking performance. For example, you could look at six months’ worth of advertising and tracking, see no sales, and give up. This would be a mistake: some leads take a long time, especially in B2B, where the purchasing journey is often far slower than B2C.

Keep the customer engaged

The key to turning leads into customers is keeping them engaged with your brand throughout the sales funnel journey. Knowing your lead times is especially useful here: if you decide to stop your efforts after a couple of months because you didn’t know your lead times could take a year or more, then that’s a customer lost.

Marketing automation can do the heavy lifting when it comes to planning, coordinating, and measuring all your campaigns – both online and offline – in tandem with your lifecycle marketing strategy.

Only gather the data you need

People are becoming more aware of how their data is collected and used. Asking too much can be a real turn-off for customers – so only ask for what you need when you need it. Not only is too much data collection a red flag from the customer’s POV, but the GDPR means you could risk big fines if you’re not compliant with collection and storage. It's not a good look for any business.

Final thoughts

A customer’s journey is never simple, and rarely linear when you break it down into micro-conversions and separate the leads into segments. By focusing on the groups of leads that lead to revenue, and by fine-tuning each micro-conversion so it best appeals to your best customers, you’ll directly improve your chances of achieving your bigger goals.

A well-managed and results-focused paid search campaign will improve your marketing efforts. At Logica, we like to take an in-depth look at your brand, customers and competitors so we can deliver you paid search campaigns that deliver leads, sales and revenue.

Once a campaign is live, we monitor, manage, and optimise it throughout its journey to assess how effective your current keywords are at converting. The result? A lead generation strategy that’s at the top of its game.

If you’d like to know what results you could expect, then request your free digital marketing audit with no obligations. Get in touch today.

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Blog written by

Mark Skinner