Summary:
Our last article was about “Service Ecommerce”. Today’s article helps business owners and advertisers understand how to enhance and transform the lead generation process so that it functions more like product ecommerce. Your possible benefits: smarter bidding, get more leads and revenue from the same budget, or lower your budget and maintain your current lead flow.
Background on ROAS
Online sales of products, often called ecommerce for short, is the purest form of online advertising. In circumstances where the full value of the transaction can be measured, the customer credit card can also serve as a source of truth and guardrails regarding the intent, quality, and value of traffic from ad campaigns.
At the simplest level, dividing the ad cost into the dollar value of sales from online ads, yields useful metrics such as Gross Return On Ad Spend (ROAS), and deeper metrics such as Net ROAS or ROI (after profit margin on products is in the equation).
Step 1: Adding a $ value to leads
Remember:
Each lead has a different potential value to you as a customer, and an often-surprising percentage of raw leads have little to no commercial value! So: Track value, eliminate waste, and deploy your ad budget more efficiently.
For easier understanding, we’ll divide lead gen into 2 buckets: With a Customer Relationship Management CRM system, and Without CRM system.
With CRM System = Actual Lead Value
CRM software can be a packaged system, such as SalesForce, HubSpot. Or your own customized system can be assembled around various software tools such as Zapier or Zoho. Either way, the concept is similar: Follow the lead through your sales cycle, then feed the successful ones back to inform the ad system such as Google Ads. Closing this feedback loop is at the core of smarter lead generation. It goes by a number of names including Offline Conversion Integration and CRM Integration to name only two.
Without CRM System = Imputed or Relative Lead Value
Without a CRM system in place or until one can be implemented, there are still improvements possible: leads can be assigned a relative value, based on your internal business metrics. For example, if raw leads from a certain business topic of yours, or a method of contact (booked appointment, inbound call, etc), covert to sales better, these can be a assigned a corresponding higher or lower value for bidding purposes.
Step 2: Value-Based Bidding
Although it may have different names, most digital ad platforms such as Google ads, or Meta ads, have settings for value-based bidding. Examples include Target ROAS and Max Conversion Value, to mention a couple.
Step 3: Set Campaign Budgets
Now, ad campaigns can be set with a dedicated traffic budget, so that leads of differing value or business topics are not competing for the same budget.
Next Step: Get a Complimentary Review
Send us your website address, and we’ll provide a thorough and complimentary review of your lead generation process. Our agency has been generating leads and helping businesses grow for 20+ years. We can help you transform raw leads into measured sales growth and a competitive advantage.