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Quantifying Soft Conversions: How to Leverage the Full Value of Paid Search

  |  October 28, 2013   |  Comments

Marketing must focus on the user and their needs, but how can you do that if you're only tracking purchases as conversions? Columnist Jeremy Hull shares three soft conversions you should be using to track user actions.

conversion-funnel-strategiesLast month in my column about the future of mobile search marketing, I wrote about the challenges digital marketers face in quantifying the value of mobile paid search clicks. One of the key strengths of search marketing is its inherent trackablility--we can track conversions at an extremely granular level and determine the exact ROI of our marketing dollars. The challenge with mobile users is that they're often looking to take actions outside of an easily tracked purchase or download.

Digital marketers are historically very bad at really leveraging these other actions. Few would dispute that calls, directions to a physical location, email list signups, and many other on-site interactions driven by paid search have value, but since purchases are much easier to track they're also much easier to exclusively focus on.

Even outside of the travel and retail verticals, advertisers tend to have one primary conversion goal and to treat all other conversion activities with little importance. Often times, these other conversions aren't even discussed outside of a cursory update during quarterly reviews, let alone leveraged daily to execute bidding and budgeting strategies.

Marketers can no longer afford to ignore these types of user actions. While they're often called "soft conversions" or "secondary conversions," the truth is these conversions do have value. To ignore this value (or only leverage it occasionally) means downplaying these interaction points and leaves room for more savvy competitors to jump in and steal traffic and market share.

Incorporating these conversions into your strategy isn't difficult; recent innovations from Google and others have made it easier than ever. Here's how to get started:

1. Determine a Value for Each Interaction Point.

Look at each possible interaction a user can have with your site outside of a purchase (or your primary conversion metric). Then use data from other sources and estimation to determine how much that interaction is worth to you.

For example, we worked with adidas and Google to determine the impact our mobile paid search marketing had on driving in-store purchases. We leveraged location extensions to drive users to a store locator page, and then used shopping pattern data to determine what percentage of users who visited that page would actually visit a store.

We then used adidas' in-store data to determine a conversion rate and purchase value for these visitors, and with these estimates were able to calculate the ROI of this paid search traffic. These calculations allowed us to budget and bid more effectively because they focused on the bottom line impact of these interactions, not just the smaller percentage of customers who completed a purchase on their phone.

2. Believe This Value... And Make Others Believe

Determining the value of these interactions is a starting point, but the next step is to sell this value internally. Make sure everyone involved understands the rationale and math behind these conversion values and update your reporting to roll them into your totals. Often, this step is where things stall out. You'll be questioned and challenged about these calculations, so be ready to defend your approach and the place of these interactions in your digital marketing data.

3. Incorporate These Conversions Into Your Bidding and Budget Allocation Strategies

When planning budget allocation, factor in all valuable conversion actions-not just your primary one. If you need to add a multiplier to reduce their importance in the totals, that's fine, but make sure they're a part of all planning, not just an afterthought.

Revisit your bidding strategy and make sure you're looking at these new conversion metrics at the keyword level and using them to inform bid adjustments. Leading management platforms like Marin, Kenshoo, and DoubleClick Search have added features that let you incorporate multiple conversion points into automated bidding via user-entered values or connection to other data sources. Don't just report on these new metrics; build your strategy around search's total contribution.

Digital marketers like hard data in a granular format, which is why this approach with all its estimation is still little-used. Google is working on providing granular, data-driven insight into new conversion points with their recently announced Estimated Total Conversions.

The initial release focused on cross-device conversions, but future updates will incorporate phone calls and in-store visits. This data will be available in AdWords reports alongside traditional conversion metrics, making it easier than ever for advertisers to track paid search performance outside of just traffic and sales.

I've worked with several advertisers who have taken the plunge into quantifying and leveraging these additional conversion points, and each one has been thrilled with the overall results both within paid search and for their brand as a whole.

Remember, your marketing should be built around the user and their needs--to dismiss a portion of these needs is to miss out on the total opportunity in the digital space.



Jeremy Hull

A recognized leader in the digital marketing space, Jeremy Hull keeps iProspect's bought media teams on the forefront of new technology and industry developments.

A passionate champion for digital advertisers, he strategically gains clients placement in many alpha and beta tests with search, display media, and tracking partners. The search engines rely on Hull's insightful analysis and feedback to improve developments like Google's Enhanced Campaigns and Remarketing Lists for Search Ads (RLSA). Hull provides paid search strategy for all iProspect teams in the United States, and also collaborates with iProspect offices around the globe. A regular speaker at tradeshows such as SES, SMX, and Advertising Week, he has also written articles for Search Engine Watch, ClickZ, Wired Innovation Insights, MediaPost, SES Magazine, the annual Internet Retailer Search Marketing Guide, and has been quoted in the Wall Street Journal. In 2013 Hull was inducted into the ClickZ Digital Marketing Hall of Fame.

Over the past nine years, Hull has provided campaign analysis and strategic direction to iProspect clients including General Motors, adidas, Neiman Marcus, The Gap, Hilton Worldwide, Cole Haan, Mandarin Oriental Hotel Group, Timberland, and many other leading brands. He was instrumental in taking Nike's successful domestic online marketing campaigns international with Nike EMEA. One would be hard-pressed to find an iProspect client that Hull has not worked with.

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