#1 New Google Advertising Strategy (For Next 3 Years)

okay everybody today i'm going to be giving you 
a glimpse into the biggest thing coming to paid   media online advertising with and through google 
over the next couple years this is pulled from   a presentation we did for the entire company with 
google on a friday that we call we an event friday   event we call innovation friday so today i'm going 
to walk you through a few slides about something   that is incredibly important for you to beat 
your competitors and this is something that   not a lot of people have set up it's called value 
base bidding and let's go ahead and dive into it   so not every customer brings the same value to 
your business right think about that not every   customer brings the same value to your business 
right one customer might buy five products   okay another customer might buy one product that 
doesn't even have great margins for you okay   so some conversions do not matter as much to your 
business goals while others are of higher value   and should be reported and optimized accordingly 
so when you're looking at three different   customers they all might have a different value 
so value based bidding brings values into smart   bidding maximizing your conversion value and 
roi okay so smart bidding this way to bid   basically based off of what's getting you the 
highest conversions letting the algorithm do the   work but layering on value based bidding on top 
of that so not just smart bidding but what type of   conversions are actually going to have the highest 
value so advertisers differentiate their customers   value but they don't often share this information 
with google for optimization you understand that   with value-based bidding the system will learn 
which potential customers are the most valuable   to advertisers and bidding towards the 
most valuable customers will deliver   incremental revenue uplift and profitability 
to advertisers does that make sense everybody   so this helps drive value and significant return 
on and spend a 14 expected medium uplift in   conversion value at a similar return on ad spend 
when moving from target cpas to target row as   is something that you can expect right 
so instead of target cost per acquisition   target return on advertising spend would be a 
look at a shift more towards value-based bidding   but that's just the beginning okay that's just 
the beginning we're going to talk a little bit   more about that evolution so value-based bidding 
works across all business models and it's going to   give you a better picture of your customers so no 
matter what model you're in you're in publishing   you're in commerce you're in lead generation right 
you're a local business it works and when you add   the value of conversion you not only get much more 
robust reporting on metrics that matter to you   but you're also giving google ads a clear view of 
how much each customer is valued by your business   google ads does not have this data google ads does 
not know how much one conversion is worth to you   than another conversion in many many cases and and 
in the current landscape maybe a couple businesses   have this set up on some level but today i'm going 
to actually walk you through what that looks like   in the future as well for the next iteration so 
you can maximize for products that drive the most   profit as set different values across across tvs 
and pc accessories you can set an average value   of store visit conversion to let smart bidding 
maximize sales across all channels online and in   store you can improve the quality of your leads 
by differentiating how much an online quote   is worth from a contract signed to drive growth 
through the lead to sale journey for example maybe   for our own business ignite visibility we have 
one lead source that results in somebody coming in   and signing up for social media paid media email 
marketing conversion rate optimization and website   development we might have another lead source that 
just leads to search engine optimization that's a   very very big difference those are not two goals 
that are equal to our business so take a look   at this and just kind of take a step back okay i 
want you to look at this slide for a minute okay   cpc clicks cost optimized cpa conversions 
cost optimized cost of sale revenue cost   optimized row as revenue value optimized profit 
roi and total profit optimized long term profit   customer lifetime value optimized clv what 
do i mean by this slide and what what does   this slide mean well it's the evolution 
right it's the evolution of advertising and   pro before previously and now for many 
people they're looking at cpa cost of sales   row as the next evolution right bidding based off 
of roads and then as a next stage profit what is   the actual profit margin of the conversion right 
just not the maximized value but the maximized   profit right and then finally customer lifetime 
value optimized right so after we get into this   row as value-based bidding spitting stage it then 
gets into a profit margin stage and eventually   a clb stage okay that's what we're looking 
at so what does it mean to bid to value   i'm going to give you a couple examples so bid to 
value acts on most common business objectives so   market share grow the percent of share of market 
within industry or particular product or service   volume increase the number the units sold number 
of leads or capacity of the business revenue   grow the amount of money the business brings in or 
profit grow the amount of money the business has   after subtracting costs think how exciting this is 
everybody okay when we're thinking about bidding   to value you're actually associating a specific 
value with the business and now the granularity   of digital marketing is about to significantly 
increase think about bidding to profit margin   thinking about knowing your highest profit margin 
products and the ones you want to sell the most   of and the most inventory that you have and 
connecting the supply chain with your ads and   then being able to feed that data back into 
the system so that they can bid efficiently   so here's an example of an online retailer 
so consider these four stages of bidding   sophistication and the features being leveraged 
in each stage okay volume objective bidding to   conversions measurement tracking conversion count 
using g tag bidding bidding to maximize conversion   purchase volume while achieving a cpa target now 
what what does purchase value row as look like   that's bidding to purchase value measurement 
dynamically track value for every transaction   using e-commerce tracking bidding bidding 
to maximize conversion value purchase value   and achieve row as goal with your target ros now 
what's margin row as right so this is the margin   of your return on advertising spent 
to the business so the objective here   is bidding to margins the measurement you have 
to import conversions and margin values via   offline conversions import and you got to get that 
back into the system right and the bidding is to   maximize conversion value margin and achieve a row 
as goal using target ros now the advanced the one   us at ignite we're pushing people as 
far up this ladder as we can right   customer lifetime value row as the objective 
bidding to forecasted customer lifetime value   measurement importing conversions and customer 
lifetime value via offline conversion imports   so think about it the big thing with these 
is you need to actually have this data to be   able to feed back into the ad system good 
news is a lot of crms and different types   of systems are are building this now they're 
going to have to build it more in the future   some of the hardest parts of all this is setting 
up the tracking you need to have somebody who can   do that for you um which we do here have here at 
ignite but it is is something that takes some time   each value represents the unique forecasted 
value of each customer which are forecasted   offline based on business signals and pass back 
to google ads and then bidding you're bidding to   maximize the conversion value the ltv and achieve 
row as goals you're going for target row as   okay so value bidding can help you bid to true 
business objectives instead of marketing goals   and that's a big deal you know i've had clients 
come and say hey john we need 3 000 conversions   a month well you know you've got seven different 
offers that are running right for those 3 000   conversions one of the offers that's getting the 
most conversions is something where you've got   the lowest close rate so do you really need 3 
000 conversions a month or do you actually just   need a hundred of the ones that have the best clv 
right customer lifetime value so um these are the   strategies by uh customer maturity and digital 
sophistication so optimize for conversion drive   drive qualified leads drive close leads right 
so think about this from the legion perspective   i want to drive more leads that have actually 
closed we get you know three 400 people who   fill out our lead gen form a month uh if 
i'm optimizing towards all of those leads   for my digital marketing that is nowhere near 
as efficient as if i find out the actual person   who closed for the highest value and then 
i refine our marketing based off of that   identify your customer value lead okay so four 
thousand dollars leads per month twenty dollar   value per lead okay four four thousand leads 
per month twenty dollar value lead five percent   conversion rate marketing qualified lead 200 m 
mqls per month 400 value per mql 50 conversion   rate sales qualified lead 100 sqls per month 
800 dollar value p per sql 25 conversion rate   closed deal 25 deals a month 3 200 value per deal 
so customer value will help you monitor the real   impact of advertising on your business and make 
the right decisions to develop growth strategies   ultimately allowing you to capture the customers 
that matter the most and generate the most value   look at all these different scenarios right 
think about this it's a mindset shift right   right i mean lead marketing qualified 
leads sales qualified lead closed deal   this is the stuff we deal with every day you can 
get so many leads 4 000 leads that's great right   what if you had 200 marketing qualified leads 
i guess that would be better what if you had   100 sales qualified leads that's good but think 
about you know the marketing team sifting through   this the sales team sifting through this what if 
you just had 25 deals that were had the highest   propensity to close coming in through your 
digital advertising think how much you could   refine your costs your system the entire business 
could run more efficiently as a result of this   all right so this is our last slide today 
you know really what we're looking to do here   is to set businesses up for success for the for 
long-term growth right and there's three core   principles that really allow you to enable this 
so share better data share data which is relevant   to your business objective and ensure these 
are as accurate as possible align value data   so assigns value to your conversions that are 
both readily available and closest to your   business objectives from transactional values to 
profits and optimize bids to business outcomes   right at the end of the day my main message for 
you today is get ahead of your competitors as   fast as possible with value based bidding look at 
your current tech stack and your systems that you   have in place right now and think about how can 
i at least start with maybe some lead scoring   right that's that's kind of step one these leads 
are better than these leads okay um how can i uh   integrate actual value based bidding as a next 
step right and feed this back into the ad system   and then you just want to continue that 
iterative process that we talked about today   until eventually you're getting to the point where 
you're looking at roads you're using smart bidding   you're looking at potentially margin based bidding 
that's a really exciting thing and then eventually   ltv and as your business gets closer 
with your digital advertising you're   only going to see things improve overall for your 
operational efficiency so this is certainly the   future and the sooner you can get ahead of it 
the better that's it for my presentation today   for you on value-based bidding some slides that 
came directly from google really exciting stuff

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