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How to lower your CPA

Search marketing is a fact of modern advertising daily life. We all do it. It is the most powerful and efficient method of reaching potential customers and is usually perceived as being responsible for a significant portion of your conversions.


The last click problem: The triumph of Google


Other channels' contributions are mostly ignored because marketers use tracking technology that typically gives 100 percent of the credit for a conversion to the last click -- which, more often than not, comes from search.



 
Another difficulty with search is that once your campaigns mature, finding methods of reaching out to larger groups can become nearly impossible. How do you make people search more? For search marketers, the solution has not been immediately obvious. But brand marketers have an idea about how this happens (hint: display!).


View-through conversions: The revenge of the ad networks


Display marketers have their own issues: The technology used by most of them typically does not give display any credit for success on direct response campaigns because it is rather rare that conversions come immediately following a display ad click. Evaluating display ad campaigns solely by looking at the last click always looks terrible when compared to search.


Of course, there's a lot of money at stake, so it wasn't long until those who have a high interest in selling display came up with a brilliant new idea: view-through conversions.


A view-through conversion simply means that when a conversion occurs, if we look back at all of the events prior to the conversion and we happen to see at least one ad impression, then we can qualify this conversion as a view-through conversion. In other words, the conversion was "influenced" by ad impressions. But in all of the ad network reports I've ever seen, the ad impressions get all of the credit. They are, perhaps unknowingly, represented as being the cause of conversions. Search is completely ignored, leading to further confusion.


The concept of view-through conversion is important because seeing that ad impressions contribute to success gives them the credit they deserve, but giving them 100 percent of the credit is more ridiculous than giving 100 percent of the credit to the last click. We clearly have a problem giving credit where it's due.


Display is a branding medium, and that's good for search


Technology is powering the shift toward new investments in display. Real-time bidding (RTB) allows marketers to be intensely focused in their targeting and to have more control over who is seeing their ads, as well as when and where those ads are displayed. Ads are bought one at a time in an auction where the highest bidder takes all. It all happens in less than one tenth of a second.
 
What we've ended up with is more control over display campaigns. We've also ended up with the ability to purchase these spaces at rates that are much lower than traditional display networks -- sometimes up to 10 times less expensive. That leaves us, as digital marketers, with more money to apply towards working media.
 
Display advertising is also meant to support branding efforts. This was especially true in the old days when the only option for display buyers was to pay very high CPMs for bulk inventory and retain little to no control over what creative was displayed and when.


Success with a branding campaign online can be measured, in part, by the associated lift in brand queries and direct traffic. This can be done via a "lo-fi" method by correlating your web analytics data and ad serving reports, for example. But there is a better way.


New technology also allows marketers to see beyond last click and find out exactly how campaigns are working with each other and influencing each other's results. We can see for each individual conversion the contribution of display, including ad impressions and clicks, and the contribution of email or search, for example. The same applies to other channels, such as mobile advertising or Facebook ads. Not only can we see this information, we can also leverage it in real time to make better bid and budget management decisions on RTB, search, and Facebook ads.


Display and search: Like peanut butter and jelly


One of the best ways to leverage RTB is to use your own search data to buy display ads. So, when a visitor comes to your website through a click on a search ad, you can use this information to bid correctly on display impressions after they leave. Because search carries intent and search ads are associated with keywords and bids, the accuracy behind whether we should bid and the bid price for any given impression is at its very best. This method is called search retargeting. Remember this: Using your own search data is perhaps the most effective way to get a second chance at capturing a missed conversion.


Here's something else we know from observing our clients' results, and this is just plain common sense from an advertising perspective: When you increase display volume, or Facebook ads volume, search volume increases and, yes, conversions increase.
 
And here's the best news: The volume increase in clicks will be in branded search terms, which is to say, your most inexpensive keywords are going to be the ones that increase in volume. Results will vary based on how strong the creative is at doing its branding job, but CPA can be made to remain in the ballpark of where it needs to be to keep the CMO happy. And volume always increases -- sometimes, very dramatically.
 
The important thing is to be able to manage the attribution of credit all the way across every one of those channels from one centralized location. When you can give credit where credit is due, you'll be able to leverage that information to further control and manage the investment that you're making in each of these channels and can manage your bids armed with information that helps you to make informed decisions, increase sales, and lower your overall CPA.
 
Marc Poirier is co-founder and CMO of Acquisio.


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Marc Poirier is a professional internet marketer with more than a decade experience and one of the top 5 PPC experts in the Search industry. He is Co-Founder and CMO of Acquisio where he leads all sales and marketing activities. He often speaks at...

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