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This chapter is from the book

The Buying Funnel and Search

A call to action works only when the consumer or searcher is ready to answer this call. But ask yourself this: Are you always ready to buy, register, call, or subscribe? I didn’t think so. Neither is your target audience. Remember Marketing 101 and those sales books that talk about the buying cycle? They have a point well worth heeding when it comes to search marketing: Not every visitor is ready to buy all the time, even after they have searched to solve a very specific need or to find a very specific product. This doesn’t mean these people are worthless visitors to you, however. They may actually be very close to becoming valuable customers or are several months away from becoming them.

One useful construct for representing the movement of people from casual consideration to commitment/conversion is the buying funnel. What is extraordinary in search is the degree to which it is possible to infer the location of searchers in this funnel based on their selection of keywords. (This topic is discussed in additional detail in the “Qualitative Method” section.)

Normally, I rant and rave about measuring conversions so you can optimize your campaign around orders, conversions to leads, or other monetizable actions that bring you a tangible return on the money you spend acquiring visitors. However, metrics such as ROI, ROAS, cost per order (CPO), cost per action (CPA), and lifetime value are just the beginning of the story for effective marketers. Effective marketers are mastering the buying funnel (the concept that describes the stages that purchasers go through on their way to making the final purchase decision) and how search delivers influence at every stage by educating site visitors, raising awareness, and improving the chances that your product, service, or company are still in consideration as the purchase decision process evolves. Marketers must embrace the reality that all the stages of the buying cycle must be taken into account when planning and executing search marketing campaigns, not just the final conversion. The evolution to this holistic view of the influence of advertising (search ads as well as others) will take time and be empowered through technology.

Different Phases of the Buying Cycles

As mentioned earlier, prospects within your target audience go through phases in the buying cycle online, just as they would in the offline world. To ignore this fact results in an inefficient site and an inefficient media campaign, regardless of traffic source (for example, search traffic, traffic from banners, or traffic from other media). Depending on your role within your organization, you may think differently about these “not ready to buy” phases.

Sales enthusiasts define the buying cycle as a continuum extending from attention, interest, conviction, desire, to close. Some marketers prefer to use a definition of the marketing cycle or marketing life cycle, and they use the acronym AIDA (attention, interest, desire, and action). Marketers are more likely to include branding metrics in their definition of stages while sales managers or VPs talk about the elimination of poor leads and the focus on those who are closer to making a purchase.

CRM marketers (those with an interest in maintaining relationships with pre-existing customers) have their own steps—reach, acquisition, conversion, retention, and loyalty—while brand-oriented marketers use lift in metrics such as unaided awareness and purchase intent.

Although the labels applied to the location of prospects within the buying cycle/buying funnel are varied, note that all these metrics are attempting to quantify, measure, or at least acknowledge that the customer goes through buying cycle/buying funnel stages, and that to be an efficient marketer you need to keep the buying process in mind when planning and executing campaigns. The same is true for search campaigns—and perhaps even more so, because CPCs are getting expensive and you need to know if they are worth it.

As a manufacturer, brand marketer, or marketer with a distribution consisting of retailers, resellers, online merchants, or other distribution outlets, you definitely want to reach consumers in the early stages of their buying cycle. As a retailer, your preference may be to catch consumers after they have passed through the early stages of the cycle and are ready to buy, or at least ready to register for a newsletter that will allow you to further market to them. So the extent to which you take the early stages of the buying cycle into account depends on your overall marketing objectives. There are two ways to factor in the early stages of the cycle—one is more quantitative, the other more qualitative.

Quantitative Method

The quantitative method of factoring the buying cycle in a search engine marketing (SEM) campaign involves the use of survey data or other information about post-click user behaviors to determine which stages of the buying cycle the visitor is in.

The next chapter will discuss blended post-click behavior metrics and the concept of branding proxies such as the Branding Effectiveness Index (BEI) that I created. This index lets you assign values to different post-click behaviors based on their impact on the visitor’s likelihood to buy (and therefore their value to you). By using this blended metric as the objective around which you optimize your search campaign, and adjusting the values of the different measured activities, you can adjust the price or position of each listing in your campaign based on the traffic’s true value to you. Each listing will deliver a mix of immediate buyers and those in earlier stages of the buying cycle (as well as a few completely disinterested people who clicked on a listing without reading it carefully).

By taking buying stages into account, you can optimize for the true value of a campaign. The challenge is in setting the values of actions so they accurately reflect the value to your organization. Brand marketers might do a site intercept survey (a sample of site visitors who receive a survey invitation while visiting your site) to determine what actions on their sites resulted in a lift in purchase intent or awareness. A direct marketer might use hard data, attributing a value to a catalog request or a newsletter registration based on how many of those requestors actually make purchases.

Qualitative Method

The qualitative method to address the early-stage versus late-stage visitor involves using linguistic logic. As mentioned earlier, powerful inferences may be made about visitors’ location within the buying cycle/buying funnel based on the keywords used to access information. Some keywords will likely indicate the mindset of the searcher sufficiently to adjust your CPC for that keyword to reflect early-stage visitors whom you still value at some level. For example, let’s illustrate a typical search marketing campaign containing a variety of keywords:

  • laser printer: This is a generic term attracting a population of searchers that is likely a mix of early- and late-stage visitors.
  • laser printer review or laser printer compare: Selection of these keywords likely indicates that these searchers are not quite ready to buy; however, they may be susceptible to marketing messages that concern the benefits of a particular type of laser printer.
  • cheap laser printer: These searchers are probably close to the purchase stage but are demonstrating price sensitivity.
  • best laser printer: These searchers are likely not quite ready to buy; however, they may be susceptible to marketing messages that concern the benefits of a particular laser printer.
  • hp 1200 laser printer: These searchers may be close to purchase due to the specific model number in the query.

Valuing Site Visitors

Should you start valuing your site visitors differently? The answer depends on your business and if you are likely to be the beneficiary of the attitude or preference changes you facilitated during the early buying stages. You don’t want to contribute to moving visitors through the buying cycle if they ultimately buy from your competition, but you may want to do so if you are a multichannel retailer and have data indicating that research done online results in an offline purchase through your retail outlet. Of course, manufacturers benefit along with their distribution channels when they use SEM, regardless of whether you consider this benefit in terms of branding, building awareness, lifting purchase intent, competitive positioning, or facilitating the sales cycle.

So, take a moment to think about your marketing objectives. Review how much emphasis you would like to place on the earlier stages of the buying cycle. Then determine how best to modify your current campaign objectives to include early-stage visitors. Addressing the needs of early-stage buyers may be one of the best investments you can make.

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