Like many marketers, you probably experienced sudden pressure to cut your paid media budgets when the pandemic started to put the squeeze on sales in 2020. With that shrinking budget came a boom in eCommerce as buying behavior changed and rapidly moved online. This means that you had to make the most of your budget to attract and retain customers with changing needs and do it quickly.
As we enter 2021, the eCommerce boom is continuing and companies are shifting back into growth mode, but the drive for reducing customer acquisition costs is still there. Since the end to these insanely fast changes in your customer’s behavior (and your budget) is nowhere near over, here are a few ways that you can take advantage of the power of AI and conversation intelligence to drive more efficient and effective paid media campaigns in the coming year.
Online High-Stakes Purchases Create Attribution Challenges
The growth in eComm doesn’t just apply to getting shampoo on Amazon instead of at Safeway. Despite the economic downturn brought on by COVID, a report Invoca commissioned found people are still making high-stakes purchases, such as cars, insurance policies, wireless plans, and big-ticket home improvement items. However, they’re changing the way they research and buy these items, in many cases moving entirely online.
For example, the survey found online shopping in automotive grew 115% since March and home improvement services increased 85%. And the stakes are also far higher for marketers in these kinds of industries, because the campaigns for products and services like these are more involved, more expensive, and take place over a longer period of time than you see in, say, CPG.
In the process of making these high-stakes purchases, consumers will frequently call companies to get the advice and support they need to feel confident about their decision. In fact, our research shows that 87% of consumers feel more confident about their purchase when they’re able to talk to a person on the phone to get their questions answered. When these purchases are completed on the phone, though, it creates an attribution challenge for marketers because the customer has dropped out of the digital realm and goes offline where they frequently cannot track conversions.
When it comes to conversions that happen offline, particularly in the contact center, many marketers are entirely flying blind, while others may have access to proxy metrics like click-to-call data. A click on the call button equals a conversion, right? Not exactly. it’s a guess, you know it’s a guess, and it’s messing up your attribution.
If you don’t have data from every touchpoint in your customer journey, you’re probably blowing money on campaigns that aren’t really performing and your CPA calculation is going to be way off. In fact, we looked at survey data from over 500 marketers and found they’re overestimating their CPA by 46% on average! And with tightening digital marketing budgets, that’s not a great option. Thankfully, there are some fairly simple ways to use AI to get better visibility into your buying journey and accurately compute your true CPA and understand your ROAS.
How to Measure Your True CPA
To fix this, first thing’s first, you have to be able to calculate your true CPA. That means you need to be able to account for all of your conversions driven by paid media, including the ones that happen in the contact center.
In this example, you’re only tracking online conversions, meaning conversions that are completed entirely online through the website. So you’re spending $10,000 a month on ads and reporting 50 online conversions with that ad spend. This means you’d have a $200 CPA. That might seem high or low depending on your business, but let’s not get too caught up in the exact numbers.
Just by using a conversation intelligence or call tracking platform that uses AI to analyze conversations and determine what calls are converting to get visibility into the conversions that happen over the phone, you find out that this ten thousand dollar ad spend is actually driving 100 conversions. Without making any other changes, this cuts your measured CPA in half.
This is what we call your “true CPA.” From there, it gets really exciting when you start using AI-derived conversation data to optimize campaigns and see a big improvement in CPA, which we’ll get into next.
Optimizing Google Smart Bidding with Call Tracking Data
One of the great examples of AI enabling marketing optimization automation is Google Smart Bidding. A lot of SEM marketers who were accustomed to making manual bidding adjustments were rightfully wary of the technology at first. How can it know better than me when I know my business so well? Well, first, there’s just no way that people can economically do keyword bidding adjustments in real time on any sort of scale.
With Smart Bidding, you can set it up to optimize to your goal, whether that’s clicks, CPA, or conversions, so you can even end up saving money, or at least getting better returns because Google is putting it against keywords that actually drive results that matter to you.
Invoca customers at eHealth did just this and reduced their click-to-call CPA by 60% and increased conversions by 20% just by using phone conversion data to optimize Google Smart Bidding. Watch this video to see how they did it.
YDesign group, an online lighting and home design retailer used similar tactics and discovered that it was bidding on a bunch of keywords that they thought were driving sales but were actually driving service calls. These are huge wins and we frequently see this achieved by integrating call conversion data with bidding platforms like Google Ads. Visibility into the call center matters, and that extends well beyond keywords bidding, too.
Reduce Wasted Ad Spend with Offline Conversion Data
Ad suppression is a key tool in the digital marketer’s kit to eliminate wasted ad spend by ensuring that they aren’t serving (and paying for) ads shown to existing or recently-acquired customers. However, this can become a challenge if those conversions are happening offline.
By tracking all call conversions with Invoca and pushing this information into platforms like Criteo, Kenshoo, or Marin Software, marketers can automatically suppress ads to those who have already converted over the phone. This not only reduces wasted ad spend, it prevents you from annoying your new customers with irrelevant ads.
Gain New Customer Insights and Increase Conversion Rates with AI
Today, customers expect more personalized and empathetic experiences than ever. In order to provide this, though, you need deep knowledge about your customers’ needs and their experiences.
AI-powered tools offer myriad ways for you to better know your customers and improve their experiences, online and offline. Using web analytics tools like Fullstory and Decibel, you can discover moments when your customers are frustrated with your web experience without them even telling you. Whether it’s cursors wandering like they’re lost in the forest or mouse-pounding rage clicking on broken buttons, you can see exactly what’s not working and fix it quickly to improve online conversion rates.
By integrating data derived from online conversations with these web analytics tools, you can also see where customers drop out of the online experience and call for help. With this information in hand, you can optimize the online experience to allow customers to do what they want online, AND make it easy for them to call when it’s time to make a high-value purchase that can benefit from a human touch to close the lead.
How Much Can You Lower Your CPA?
Try our CPA calculator to find out!