Globalis Media

Many LCC’s Are Very Inefficient in Online Marketing

The entire concept of LCC’s is based upon operating efficiency and having very different cost structures than legacy airlines. LCC executives are focused on finances, operational efficiency, and ROI. They strive to have lower cost structures and more efficient operations than legacy airlines. However, many LCC’s are notoriously inefficient in buying online media and managing online marketing campaigns.

Surprisingly, many LCC’s hire the same large high-cost media agencies used by high-cost legacy airlines. These media agencies are usually subsidiaries of huge global advertising holding companies, with very high cost structures, multiple layers of administration and management, high-rent luxury offices, big entertainment budgets, and the obligation to constantly deliver quarterly and annual revenue and profit growth.

Many LCC’s pay far more than they should for high-priced media, and try to compete with legacy airlines and with other LCC’s using legacy agencies, legacy marketing methods, and the same high marketing cost structure as legacy airlines. This makes absolutely no sense. It’s like the management of a LCC deciding to serve unlimited champagne, lobster, Kobe beef, and truffles to every passenger.

It is perplexing that LCC executives, who are usually focused on cost-efficiency, very often lose this focus when it comes to their choice of media agencies and how they spend their marketing budgets.

Globalis Media ran test campaigns for one of the pioneering LCC’s in Asia in their hub market. We lowered the LCC’s eCPA (cost per flight booked) by 85% vs. what they had been achieving when using a media agency belonging to a huge global advertising holding company. The LCC asked Globalis to run additional test campaigns in a second market. Once again, we lowered their cost per flight booked by over 80%. The LCC kept taking away more and more of their media budget from the “legacy” agency, and awarding it to Globalis, until we had won much of the LCC’s total online advertising business away from the high-cost legacy agency. We ended up buying media and managing the LCC’s online advertising campaigns in virtually all of their many markets. We have repeated this kind of successful online marketing cost reduction again and again for several LCC’s.

LCC Evolution and Online Marketing Strategies

To best serve the needs of LCC clients, a media agency must fully understand the LCC business in general, and each client’s business specifically. The agency should consider such factors as: Is the campaign being done in the LCC’s home / hub market, or in an outstation market? What is the level of the LCC’s brand awareness in each market? How long has the LCC been flying a particular route and advertising in a particular market? Is the LCC a new company, a relaunch / repositioning, or a spinoff? What are the LCC’s other marketing and communications activities?

Regrettably, few media agencies understand the specific needs and brand / route life stages of LCC’s well, and so agencies just commit the LCC’s marketing budgets to generic online marketing plans and expensive media that often don’t evolve in sync with the LCC’s evolution. LCC’s need specific online marketing strategies and tactics for various phases of their evolution, different competitive scenarios, and different objectives in each market. The following is an example of how marketing objectives and key performance metrics might evolve for LCC’s:

The above table is not intended as a specific recommendation to apply to all LCC”s in all situations. Rather, it is intended as a general illustration of how LCC’s and their media agencies need to evolve marketing strategies, objectives, and key performance metrics as an LCC evolves in each market. Competitive developments and market dynamics also often influence LCC operations on each route, and the media agency should stay abreast of market dynamics and adjust online marketing strategies accordingly.

Understanding Online Marketing Performance Metrics

There are many different performance metrics in online marketing. It is imperative that LCC’s and their agencies focus on the correct performance metrics for each specific online marketing objective at each point in an LCC’s life cycle evolution in each market. Many media agencies and many LCC advertisers don’t use online campaign performance metrics optimally. Therefore, online media strategies and tactics are often flawed, media buying is inefficient, online advertising campaigns are run sub-optimally, and much marketing budget is wasted.

Many different online metrics can be very important early on in the marketing life cycle of a LCC, or for a new route. Just as online marketing strategies and tactics must change over the life cycle of a LCC in a given market, the campaign metrics used to evaluate performance also need to change. Ultimately, in most cases, the measure of success for online marketing should be how many flight bookings can be made, at what cost, and if a company’s online marketing is profitable. In Globalis Media, we view it as our mission to have our clients’ online marketing operate as a profit center, rather than as a cost center.

Clicks, Click-through Rate, and Effective Cost per Click

Many agencies and advertisers focus heavily on clicks. Focusing on clicks is great for media agencies because it’s very easy to optimize campaigns for CTR, clicks, and eCPC, and click-based models are very lucrative for agencies, online ad platforms, and media publishers. Media owners and agencies can easily generate a high volume of clicks and receive high revenues from advertisers. However, for display advertising, click-based models rarely serve the best interest of LCC’s. Ultimately, LCC’s investors and other stakeholders do not care about numbers of clicks, CTR, or eCPC. For our LCC clients, we primarily focus on how many tickets our clients sell via online marketing (conversions), and how much it costs to sell each ticket (eCPA: effective Cost per Acquisition).

Many advertisers and agencies assume that higher CTR and more clicks will lead to higher conversion and better (lower) eCPA. In fact, what we have observed over several years managing online campaigns for LCC’s and many advertisers in other industries is the opposite: there is often a reverse correlation between click rate and conversion rate. We have confirmed the reverse correlation between click rate and conversion rate with many online marketing industry veterans. While this seems counter-intuitive, there are various reasons for this apparent anomaly. For airlines, in particular, this is due, in large part, to the importance of post-view conversions, which have nothing to do with clicks or CTR.

Most DSP’s give campaign managers a choice of either optimizing campaigns by CTR and eCPC or by eCPA, and campaign managers can use various tools to either reduce eCPC or increase conversions. It is very important to understand that prioritizing clicks or conversions is usually an “either / or” proposition. Agency campaign managers taking the easier option of prioritizing clicks rather than conversions (flight bookings) may, in fact, not be working in the best interest of LCC advertisers. We wrote a piece entitled, “1998 called … It wants it’s ‘Pay Per Click’ ad campaigns back”, which can be viewed here.

A LCC’s evolutionary stage and brand equity may greatly influence CTR in each market. Creative execution and the ad offer can also play a big role in CTR. Obviously, ads promoting $1 air fares are likely to achieve much higher CTR than $99 fares.

The specific targeting of each campaign and each line item impacts CTR and eCPC. We run some travel line items very broadly to increase reach and conversions, some line items with a moderate degree of contextual targeting, some line items contextually targeted only to travel-related web sites, and some line items niche-targeted to air travel or budget travel or travel to a specific destination. A broad-based line item might generate a 0.1% CTR, while a travel-specific line item might generate a 0.3% CTR, but if the travel-specific media cost 5X more, then the broad-based line item would out-perform the travel-specific line item on eCPC, while also likely generating much higher click volume. However, superior performance on click volume and eCPC does not necessarily translate into superior performance on conversion rate or eCPA.

Retargeting campaigns tend to generate 2X – 5X higher CTR vs. other line items. But retargeting campaigns are most successful when broader-based campaigns are used to generate a relatively high volume of site visitors at reasonable eCPV (effective Cost per Site Visitor).

Conversions / eCPA

We have helped LCC’s generate millions of flight bookings. Obviously, volume of flight bookings (conversions) depends upon very many factors, including number of markets, which markets, market / catchment area size, population per market, number of years in each market, competitiveness of each route, fare strategy, flight distance, etc.

eCPA usually decreases over time as an LCC gets more “established” in a market / route. For example, we have seen many cases in which eCPA in the first or second month might be US $50, decreasing continuously every month to $10 or less within one year, and much lower the next year.

Retargeting campaigns tend to generate 5X – 10X higher conversion rate vs. other line items. For most LCC’s, post-view conversions greatly exceed post-click conversions, and so it is very important that both types of conversions be counted.

Impressions and eCPM’s

Globalis Media has found that the best strategy for helping our LCC clients to successfully launch and grow their business is to run multi-faceted campaigns consisting of many different line items working synergistically. Some broad-based line items have very low CPM’s, while some line items with narrow contextual targeting have relatively higher CPM’s. Retargeting line items have higher CPM’s to be competitive to win as many real-time bids as possible, due to the high-potential value of retargeting imps, i.e., users being retargeted are much more likely to click and to convert (book a flight).

CPM bids are important to Globalis Media as one of the many variables we use to buy media and manage online advertising campaigns for our LCC clients. But, as with CTR, clicks, and eCPC, we recommend that clients not pay too much attention to CPM costs in evaluating online marketing performance. For example:

Media #1: $5.00 CPM, $1,000 buys 200,000 impressions, producing 200 flight bookings @ $5.00 eCPA.

Media #2: $0.50 CPM, $1,000 buys 2,000,000 impressions, producing 100 flight bookings @ $10.00 eCPA.

In this example, the media costing a 10X higher CPM generates 2X more flight bookings at a 50% lower cost per flight booking, with the higher CPM being of little significance.

Using Precise Geo-Targeting to Improve Campaign Performance for LCC’s

While most agencies and advertisers now know how to do basic, national geo-targeting, few are adept at using geo-targeting on a more local basis, such as by state, province, or city. Ironically, many smaller, local businesses seem more knowledgeable about local geo-targeting than “major” media agencies and international corporations. Many agencies and advertisers, lacking knowledge of how to geo-target campaigns, mistakenly run campaigns nationally in cases where it would be better for advertisers to use regional or local targeting.

Airlines often waste much of their online marketing budgets using national targeting when, in fact, the catchment area for the airport(s) they serve in a country is just a small portion of the total country. Globalis Media has saved many airlines cumulatively millions of dollars by implementing intelligent local geo-targeting to replace wasteful national targeting that had been used prior to Globalis correcting geo-targeting.

An LCC was spending much money on online marketing in India, but generating relatively few flight bookings, and suffering significant losses in India. Globalis Media was called in to help rescue the LCC’s India business, and we immediately noticed that the incumbent “major” media agency had been running the LCC’s online ads across the entire, vast country of India, wasting approximately 90% of the LCC’s budget, and resulting in huge losses with no ROI on marketing expense. Globalis quickly fixed the problem, geo-targeting the LCC’s online ads to the few states within the catchment areas of the specific local markets served by the LCC. After implementing this correct geo-targeting, the LCC started to quickly see a huge improvement in marketing cost-performance and growth in their India business.

Significant cost savings and superior online marketing cost-performance can be achieved by fully leveraging the power of precise geo-targeting combined with precise language targeting and effective contextual targeting. Globalis Media has run campaigns for advertisers targeting specific regions, prefectures, states, provinces and cities in dozens of countries.

Using Precise Language Targeting to Improve Campaign Performance for LCC’s

Few LCC’s and media agencies have expertise in using language targeting in online marketing campaigns.

In Singapore, 50% of people speak Chinese as their primary language at home, while 32% speak English, 12% speak Malay, and 6% speak other languages. When we were asked by a major LCC to help them to grow their business in Singapore (and other markets), we were absolutely astounded to find out that the “major” media agency they had been using had been using only English-language banners in Singapore. While the benefits of a media agency being owned by a huge, global conglomerate are not clear to us, what is clear to us is that LCC’s media agencies must know their clients’ local markets very well. Ignoring the 50% of Singaporeans who speak Chinese as their primary language indicates a poor understanding of the Singapore market. Globalis Media has been successfully leveraging the power of precise language targeting for our clients since 2006.

In another country, another LCC had very poor performance on English-language banners, and were not running any banners in the local language – until we informed them that that country has the lowest penetration of English speakers among local populations in Asia. They started using in their online ads the language that locals could actually understand and their online bookings increased significantly.

Companies and agencies without language targeting expertise might assume that countries with relatively homogenous populations speaking one common language don’t have opportunities to use language targeting. But Globalis Media has proven this to be wrong. In a country in which 98% of the population speak the local language, an LCC was doing the logical thing, using only local-language banner ads. Globalis recommended that the LCC also run English-language banners to reach the segment of foreigners which, we believed, were under-served and under-targeted by other airlines. We also hypothesized that the relatively small segment of foreigners had a higher frequency of international travel than the indigenous population and were also very much more likely to try a start-up airline. We were right, and the LCC did surprisingly well targeting a market (language) segment that they had originally ignored prior to our recommendation.

In many countries, Globalis runs creatives in both the native language and English, targeting each user based upon their browser language settings. This has proven to be a very successful user targeting strategy for our clients in many countries – particularly for LCC’s.

Globalis usually uses language targeting combined with precise geographical targeting, contextual targeting, retargeting, and other strategies and tactics to show advertisers’ online ads in the right language, to the right users, in the right place, at the right time.

Understanding Local Markets and Cultures

It is imperative that media agencies understand very well the local markets and cultures served by their LCC clients. LCC’s are known for providing “value” to consumers. But “value” is perceived differently by different cultures. In some markets and cultures, people may choose a non-direct flight adding several extra hours to their travel time just to save $50, while people with other cultural perspectives may value convenience and time savings higher than they value cost savings of $50.

Short-Haul vs. Long-Haul Flights Require Different Marketing Methods and Messaging

As more LCC’s venture into longer-haul flights, it is very important to understand the significant differences between short-haul and long-haul flights. We encourage LCC’s to ask their media agencies about these differences. The Globalis Media team is available to discuss this with prospective clients.

Globalis Media and LCC’s

Globalis Media has been buying media and managing online advertising campaigns cost-effectively for various companies since 2006. Globalis has helped many LCC’s to successfully launch and expand their business. Many LCC’s have found Globalis Media to be an ideal partner, since our mission of providing low-cost online marketing services is totally consistent with LCC’s mission of providing cost-efficient air travel.

Contact Globalis Media.

Moving companies can significantly improve the results of their online marketing campaigns.  Here are a few tips how movers can acquire more customers, while reducing their cost of customer acquisition.

      1.) Understand The Online Marketing Ecosystem      

The online marketing ecosystem is very multi-faceted.  A few online tactics and media platforms are widely used, e.g., SEO, Google AdWords and Facebook ads.  However, these are just a few components of the entire online marketing ecosystem.  In most cases, marketers need to have holistic online marketing plans, including many different strategies and tactics working in synergy.

      2) Don’t Overspend On Search Advertising

It is a very common mistake by online advertisers and media agencies to overspend on search advertising, particularly, Google AdWords. Many moving companies commit this mistake – with serious consequences for their online marketing budget and their marketing ROI.

Industry sources indicate that people spend only 3% – 5% of their total time online using search. Even Google, which has every reason to promote the importance of search, mentions in its own presentations that people spend only 5% of their online time using search, while spending 95% of their time on non-search activities.

It is very important for online marketers to understand that people can be exposed to display ads 95% – 97% of the time they are online, while being potentially exposed to search ads only 3 – 5% of the time they are online.  Many online advertisers, including many moving companies, spend a large portion, or even their entire online advertising budget, on search ads, trying to reach consumers during the little time they spend doing search, while failing to show ads to consumers during the 95% – 97% of the time they are engaged in other online activities.

Spending most, or all, of a company’s online marketing budget on search advertising might be a viable strategy for advertisers with very narrowly-targeted products or services, but it is a very wasteful misallocation of online marketing budget for most advertisers, including moving companies, whose services appeal to a relatively broad market.

According to the US Census Bureau, 12% of Americans, 36 Million people, move every year.  Moving companies can catch the attention of many more potential customers by reallocating more of their online marketing budget to display banner ads.

      3) Carefully Compare Online Advertising Options And Costs

Search advertising is very expensive. There are many reasons for this.  For one, Google has a 64% share of the US search advertising market, and Google and Microsoft together account for an 85% share of the market. Markets essentially consisting of only 1 – 2 suppliers are rarely favorable for buyers (advertisers). Secondly, the inventory of desirable search words is very limited. For example, in New York City (the nation’s most populous city) there were only 13,500 searches conducted in Google for the top two moving-related search phrases during a recent month. (Please see details in the table below.)  Thirdly, competition for many search words, including search words for moving companies, is very high, often with many companies bidding in each city.  Fourthly, the technological platforms and business models of search engines are predicated on maximizing the cost per click advertisers pay.  Pay per Click search ads are clearly a seller’s market.

In contrast to search ads being a sellers’ market, the market for display advertising is very much a buyers’ market.  While recent CPC’s for key moving-related search terms in major markets have typically been around $21, as shown above, moving companies can purchase clicks via display banner ads for $2.00 CPC or less.  This is for clicks geo-targeted within specific cities.  State-wide, regional, or national campaigns have even lower CPC’s.

Conversion rates tend to be higher on search ads than on display banner ads, so one could argue that a click on a search ad may be worth, for example, double or triple the value of a click on a banner ad.  That would justify the cost of clicks on search ads being double or triple the cost of clicks on banner ad.  But there is no rational justification for search clicks to cost ten times more than banner clicks.   Search ad CPC’s tend to be grossly over-priced.

      4) Move The Needle On Your Business With Display Ads

In addition to search ads being grossly over-priced compared to display ads, search ads also compare poorly to display ads in terms of the level of web site traffic and the volume of business they can generate for most online advertisers.

Referring to the recent Google data shown in the table above, if a moving company bid Google’s “suggested bid” per click for the top two moving-related search terms in New York, and if the click rate were the industry average of 2.4% for consumer services search ads in Google, a moving company could buy a maximum of only 324 clicks (site visitors) per month.  Out of these 324 site visitors, a relative few would evolve into leads, and even fewer would ever become actual customers.  This would have cost a moving company about $7,000.

Spending $7,000 on display ads, instead of search ads, would likely generate 3,500 or more clicks (site visitors).  Even if it were assumed that site visitors from search ads are twice as likely as site visitors from display ads to “convert” into a lead, it would mean that $7,000 spent on display ads is likely to generate about five times more leads than the same amount spent on search ads.  Based upon our company’s ten years of experience buying online media and managing online marketing campaigns, this huge out-performance of display ads vs. search ads is the norm.

     5) Unleash The Power Of Remarketing

You’ve probably heard about the power of remarketing (also known as retargeting).  When we are asked what is the one online marketing method we would recommend above all others, our response is always “remarketing”.

Remarketing usually involves placing programming code on a company’s web site, which enables cookies to be saved in site visitors’ computers or mobile devices.  In the days, weeks and months after a user has visited a web site, an ad can be served to the site visitor reminding him of the company whose site he visited, re-introducing their brand, and even offering a special deal.

Businesses spend much money trying to get consumers to visit their web site. Those businesses that understand online marketing very well use the power of remarketing to get a second, third, fourth, and fifth chance to communicate with their prospects to try to convert them into leads and, ultimately, into a sale.  Businesses that don’t use remarketing are wasting opportunities and, in essence, just giving up on prospective customers after only one visit to their web site.

      6) Continuously Test, Analyze, Learn, And Optimize

Online advertising technology has continuously evolved over the past twenty years.  This advanced technology makes it easy to test all kinds of variables, and to quickly see analytics and performance results for the variables tested. Different media placements, various kinds of targeting, different types of ads, alternative creative executions, changes in messaging, pricing, landing pages, and many other variables can be tested easily with almost no incremental cost beyond the cost of media used for testing.   But, surprisingly, relatively few online advertisers fully leverage the capabilities of online advertising technology for testing.

Based upon our own experience helping online advertisers improve their online marketing performance, we believe that many advertisers can improve performance and ROI by 50% – 100% within several months – if they continuously test variables, analyze the results, apply test learning, optimize their online marketing efforts, and repeat this process.  For example, spending just a little money to make some new banners and to slightly modify a landing page may result in a 20% improvement in online marketing performance.  For an online advertiser spending $10,000 per month, this could result in annual cost savings of $24,000, or tens of thousands of dollars in additional business generated from the same spending level.

      7) Leverage The Capabilities Of A Professional Media Agency

Many marketers try to manage their online advertising campaigns in-house, or through freelance consultants, often marketing themselves as “AdWords experts”.  Indeed, AdWords is easy to access for most businesses and individuals.  In the case of display media, while there are self-serve platforms available, there are several issues to consider.  Firstly, the top media-buying platforms in the world with the best technology and access to the most media options and the highest quality media usually require minimum monthly spends of $25,000 – $100,000 or more.  Secondly, expertise in fully leveraging these powerful programmatic media-buying and campaign management technology platforms requires much training.  Thirdly, small and mid-sized companies might not want to take on the expense of having a full-time or part-time media expert manage their online media buying.

A good online media agency can provide world-class technological capabilities and media-buying and campaign management expertise that saves advertisers much more money than the agency’s fees.  In essence, a good online media agency should “pay for itself” through generating many new customers and significantly reducing customer acquisition costs for its clients.

The author, Paul Anders Schwamm, is a well-known marketer, with seventeen years of online marketing experience.  Paul started Globalis Media Inc. in 2006 as an advertiser-centric media buying agency, with the mission of saving money for online advertisers.  Globalis Media consistently out-performs other media agencies and in-house media buying teams.  Globalis Media is a Certified Google Partner agency, using world-class ad technology, including leading programmatic platforms, together with best practices in media buying and campaign management.  Please feel free to ask us for a proposal regarding how we can help your business acquire more online customers at significantly lower customer acquisition costs.

Mortgage companies and mortgage brokers can significantly improve the results of their online marketing campaigns. Here are a few tips how mortgage marketers can acquire more customers, while reducing their cost of customer acquisition.

      1.) Understand The Online Marketing Ecosystem      

The online marketing ecosystem is very multi-faceted. A few online tactics and media platforms are widely used, e.g., SEO, Google AdWords and Facebook ads. However, these are just a few components of the entire online marketing ecosystem. In most cases, marketers need to have holistic online marketing plans, including many different strategies and tactics working in synergy.

      2) Don’t Overspend On Search Advertising

It is a very common mistake by online advertisers and media agencies to overspend on search advertising, particularly, Google AdWords. Many mortgage marketers commit this mistake constantly – with grave consequences for their online marketing budget and their marketing ROI.

Industry sources indicate that people spend only 3% – 5% of their total time online using search. Even Google, which has every reason to promote the importance of search, mentions in its own presentations that people spend only 5% of their online time using search, while spending 95% of their time on non-search activities.

It is very important for online marketers to understand that people can be exposed to display ads 95% – 97% of the time they are online, while only being potentially exposed to search ads 3 – 5% of the time they are online. Many online advertisers, including many mortgage marketers, spend a large portion, or even their entire online advertising budget, on search ads, trying to reach consumers during the little time they spend doing search, while failing to show ads to consumers during the 95% – 97% of the time they are engaged in other online activities. This might be a viable strategy for advertisers with very narrowly-targeted products or services, but it is a very wasteful misallocation of online marketing budget for most advertisers, including mortgage marketers, whose services appeal to a very broad market.

There are some 85 million home-owners in the US, as well as millions of potential first-time home-owners. Mortgage marketers can catch the attention of more of these potential customers by reallocating more of their online marketing budget to display banner ads.

      3) Carefully Compare Online Advertising Options And Costs

Just as consumers should be well-informed and carefully shop for a mortgage that best meets their needs, the same holds true for mortgage marketers investing in online advertising.

Search word advertising is very expensive. There are many reasons for this. For one, Google has a 64% share of the US search advertising market, and Google and Microsoft together account for an 85% share of the market. Markets essentially consisting of only 1 – 2 suppliers are rarely favorable for buyers (advertisers). Secondly, the inventory of desirable search words is very limited. For example, in New York City (the nation’s most populous city) there were only 11,720 searches conducted for the top ten mortgage-related search phrases during a recent month. (Please see details in the table below.) Thirdly, competition for many search words, including mortgage-related search words, is very high, often with ten, twenty, or more companies bidding in each city. Fourthly, the technological platforms and business models of search engines are predicated on maximizing the cost per click advertisers pay. Pay per Click search ads are clearly a seller’s market.

In contrast to search ads being a sellers’ market, the market for display advertising is very much a buyers’ market. While recent CPC’s for key mortgage-related search terms are typically $15 – $33, as shown above, mortgage marketers can purchase clicks via display banner ads for $2.00 CPC or less. This is for clicks geo-targeted within specific cities. State-wide, regional, or national campaigns have even lower CPC’s.

Conversion rates tend to be higher on search ads than on display banner ads, so one could argue that a click on a search ad may be worth, for example, double or triple the value of a click on a banner ad. That would justify the cost of clicks on search ads being double or triple the cost of clicks on banner ad. But there is no rational justification for search clicks to cost eight to seventeen times the cost of banner clicks. Search ad CPC’s tend to be grossly over-priced.

      4) Move The Needle On Your Business With Display Ads

In addition to search ads being grossly over-priced compared to display ads, search ads also compare poorly to display ads in terms of the level of web site traffic and the volume of business they can generate for most online advertisers.

Referring to the recent Google data shown in the table above, if a mortgage marketer bid Google’s “suggested bid” per click for all of the top ten mortgage-related search terms in New York, and if the click rate were the industry average of 2% for real estate-related search ads in Google, a mortgage marketer could buy a total of 235 clicks (site visitors) per month. Out of these 235 site visitors, a relative few would evolve into leads, and even fewer would ever go all the way through to originating a mortgage. This would have cost a mortgage marketer about $5,000.

Spending $5,000 on display ads would likely generate 2,500 or more clicks (site visitors). Even if it were assumed that site visitors from search ads are twice as likely as site visitors from display ads to “convert” into a lead, it would mean that $5,000 spent on display ads is likely to generate about five times more leads than the same amount spent on search ads. Based upon our company’s ten years of experience buying online media and managing online marketing campaigns for hundreds of companies, this huge out-performance of display ads vs. search ads is the norm.

     5) Unleash The Power Of Remarketing

You’ve probably heard about the power of remarketing (also known as retargeting). I’ve been involved in online marketing for 17 years, and when I’m asked what’s the one online marketing method I would recommend above all others, my response is always “remarketing”.

Remarketing usually involves placing some programming code on a company’s web site, which enables cookies to be saved in site visitors’ computers or mobile devices. In the days, weeks and months after a user has visited a web site, an ad can be served to the site visitor reminding him of the company whose site he visited, re-introducing their brand, and even offering a special deal, e.g., a reduced fee refinancing, etc.

Businesses, including many banks, mortgage companies, and mortgage brokers, spend much money trying to get consumers to visit their web site. Those businesses that understand online marketing very well use the power of remarketing to get a second, third, fourth, and fifth chance to communicate with their prospects to try to convert them into leads and, ultimately, into a sale. Businesses that don’t use remarketing are wasting opportunities and, in essence, just giving up on prospective customers after only one visit to their web site.

      6) Continuously Test, Analyze, Learn, And Optimize

Online advertising technology has continuously evolved over the past twenty years. This advanced technology makes it easy to test all kinds of variables, and to quickly see analytics and performance results for the variables tested. Different media placements, various kinds of targeting, different types of ads, alternative creative executions, changes in messaging, pricing, landing pages, and many other variables can be tested easily with almost no incremental cost beyond the cost of media used for testing. But, surprisingly, relatively few online advertisers fully leverage the capabilities of online advertising technology for testing.

Based upon our own experience helping online advertisers improve their online marketing performance, we believe that many advertisers can improve their performance and ROI by 50% – 100% within one year – if they continuously test variables, analyze the results, apply test learning, optimize their online marketing efforts, and repeat this process. A typical result we’ve seen many times is that spending a few hundred dollars to make some new banners and to slightly modify a landing page may result in, for example, a 20% improvement in online marketing performance. For an online advertiser spending $10,000 per month, this could result in annual cost savings of $20,000, or tens of thousands of dollars in additional business generated from the same spending level.

      7) Leverage The Capabilities Of A Professional Media Agency

Many marketers try to manage their online advertising campaigns in-house, or through freelance consultants, often marketing themselves as “AdWords experts”. Indeed, AdWords is easy to access for most businesses and individuals. In the case of display media, while there are self-serve platforms available, there are several issues to consider. Firstly, the top media-buying platforms in the world with the best technology and access to the most media options and the highest quality media usually require minimum monthly spends of $25,000 – $100,000 or more. Secondly, expertise in fully leveraging these powerful programmatic media-buying and campaign management technology platforms requires much training. Thirdly, small and mid-sized companies might not want to take on the expense of having a full-time or part-time media expert manage their online media buying. A good online media agency should be able to provide world-class technological capabilities and media-buying and campaign management expertise that saves advertisers much more money than the agency’s fees. In essence, a good online media agency should “pay for itself” through generating many new customers and significantly reducing customer acquisition costs for its clients.

The author, Paul Anders Schwamm, is a well-known marketer, with thirty years of international marketing and advertising technology experience. Paul started Globalis Media Inc. in 2006 as an advertiser-centric media buying agency, with the mission of saving money for online advertisers. Globalis Media consistently out-performs other media agencies and in-house media-buying teams. Globalis Media is a Certified Google Partner agency, using world-class ad technology, including leading programmatic platforms, together with best practices in media buying and campaign management. Please feel free to ask us for a proposal regarding how we can help your business acquire more online customers at significantly lower customer acquisition costs.

Lawyers can significantly improve the results of their online marketing campaigns.  Here are a few tips how movers can acquire more customers, while reducing their cost of customer acquisition.

      1.) Understand The Online Marketing Ecosystem      

The online marketing ecosystem is very multi-faceted.  A few online tactics and media platforms are widely used, e.g., SEO, Google AdWords and Facebook ads.  However, these are just a few components of the vast online marketing ecosystem.  In most cases, marketers need to have holistic online marketing plans, using many different platforms, strategies, and tactics working in synergy. Demand Side Platform (DSP’s) enable advertisers and media agencies to leverage the efficacy of programmatic Real Time Bidding (RTB), and have become one of the cornerstones of online advertising technology.

      2) Don’t Overspend On Search Ads And Underspend on Display Ads

It is a very common mistake by online advertisers and media agencies to overspend on search advertising, particularly, Google AdWords. Many lawyers commit this mistake – with serious consequences for their online marketing budget and their marketing ROI.

Industry sources indicate that people spend only 3% – 5% of their total time online using search. Even Google, which has every reason to promote the importance of search, mentions in its own presentations that people spend only 5% of their online time using search, while spending 95% of their time on non-search activities.

It is very important for online marketers to understand that people can be exposed to display ads 95% – 97% of the time they are online, while being potentially exposed to search ads only 3 – 5% of the time they are online.  Many online advertisers, including many lawyers, spend a large portion, or even their entire online advertising budget, on search ads, trying to reach consumers during the little time they spend doing search, while failing to show ads to consumers during the 95% – 97% of the time they are engaged in other online activities.

      3) Carefully Compare Online Advertising Options And Costs

Search advertising is very expensive. There are many reasons for this.  For one, Google has a 64% share of the US search advertising market, and Google and Microsoft together account for an 85% share of the market. Markets essentially consisting of only 1 – 2 suppliers are rarely favorable for buyers (advertisers). Secondly, the inventory of desirable search words is very limited. For example, in New York City (the nation’s most populous city) there were only 13,500 searches conducted in Google for the top four lawyer-related search phrases during a recent month. (Please see details in the table below.)  Thirdly, competition for many search words, including search words for lawyer, is very high, often with many companies bidding in each city.  Fourthly, the technological platforms and business models of search engines are predicated on maximizing the cost per click advertisers pay.  Pay per Click search ads are clearly a seller’s market.

In contrast to search ads being a sellers’ market, the market for display advertising is very much a buyers’ market.  While recent CPC’s for key lawyer-related search terms in major markets have typically been $30 – $100 or more, as shown above, lawyers can purchase clicks via display banner ads for $3 – $5 CPC.  This is for clicks geo-targeted within specific cities.  State-wide, regional, or national campaigns have even lower CPC’s.

Conversion rates tend to be higher on search ads than on display banner ads, so one could argue that a click on a search ad may be worth, for example, double or triple the value of a click on a banner ad.  That would justify the cost of clicks on search ads being double or triple the cost of clicks on banner ad.  But there is no rational justification for search clicks to cost ten to fifty times more than banner clicks.   Search ad CPC’s tend to be grossly over-priced.

Another important factor to be considered is that search ads appear on a page listing many competitors. Display ads usually appear in a much less competitive environment, in which potential customers usually only see one advertiser for a specific industry at any one time.

      4) Move The Needle On Your Legal Practice With Display Ads

In addition to search ads being grossly over-priced compared to display ads, search ads also compare very poorly to display ads in terms of the level of web site traffic and the volume of new clients they can generate for attorneys. Search ads for legal services have one of the lowest click rates among all industries in Google Adwords.

Referring to the recent Google data shown in the table above, if a lawyer bid Google’s “suggested bid” per click for the top four lawyer-related search terms in New York, and if the click rate were the industry average of 1.35% for legal services search ads in Google, a lawyer could buy a maximum of only 91 clicks (site visitors) per month.  Out of these 91 site visitors, a relative few would evolve into leads, and even fewer would ever become actual customers.  This would have cost a lawyer about $4,500.

Spending $4,500 on display ads, instead of search ads, would likely generate 1,200 or more clicks (site visitors).  Even if it were assumed that site visitors from search ads are three times as likely as site visitors from display ads to “convert” into a new client, it would mean that $4,500 spent on display ads is likely to generate about four or five times more new clients than the same amount spent on search ads.  Based upon our company’s ten years of experience buying online media and managing online marketing campaigns, this huge out-performance of display ads vs. search ads is the norm.

     5) Unleash The Power Of Remarketing

You’ve probably heard about the power of remarketing (also known as retargeting).  When we are asked what is the one online marketing method we would recommend above all others, our response is always “remarketing”.

Remarketing usually involves placing programming code on a company’s web site, which enables cookies to be saved in site visitors’ computers or mobile devices.  In the days, weeks and months after a user has visited a web site, an ad can be served to the site visitor reminding him of the company whose site he visited, re-introducing their brand, and even offering a special deal.

Businesses spend much money trying to get consumers to visit their web site. Those businesses that understand online marketing very well use the power of remarketing to get a second, third, fourth, and fifth chance to communicate with their prospects to try to convert them into leads and, ultimately, into a sale.  Businesses that don’t use remarketing are wasting opportunities and, in essence, just giving up on prospective customers after only one visit to their web site.

      6) Continuously Test, Analyze, Learn, And Optimize

Online advertising technology has continuously evolved over the past twenty years.  This advanced technology makes it easy to test all kinds of variables, and to quickly see analytics and performance results for the variables tested. Different media placements, various kinds of targeting, different types of ads, alternative creative executions, changes in messaging, pricing, landing pages, and many other variables can be tested easily with almost no incremental cost beyond the cost of media used for testing.   But, surprisingly, relatively few online advertisers fully leverage the capabilities of online advertising technology for testing.

Based upon our own experience helping online advertisers improve their online marketing performance, we believe that many advertisers can improve performance and ROI by 50% – 100% within several months – if they continuously test variables, analyze the results, apply test learning, optimize their online marketing efforts, and repeat this process.  For example, spending just a little money to make some new banners and to slightly modify a landing page may result in a 20% improvement in online marketing performance.  For an online advertiser spending $10,000 per month, this could result in annual cost savings of $24,000, or tens of thousands of dollars in additional business generated from the same spending level.

      7) Leverage The Capabilities Of A Professional Media Agency

Many marketers try to manage their online advertising campaigns in-house, or through freelance consultants, often marketing themselves as “AdWords experts”.  Indeed, AdWords is easy to access for most businesses and individuals.  In the case of display media, while there are self-serve platforms available, there are several issues to consider.  Firstly, the top media-buying platforms in the world with the best technology and access to the most media options and the highest quality media usually require minimum monthly spends of $25,000 – $100,000 or more.  Secondly, expertise in fully leveraging these powerful programmatic media-buying and campaign management technology platforms requires much training.  Thirdly, small and mid-sized companies might not want to take on the expense of having a full-time or part-time media expert manage their online media buying.

A good online media agency can provide world-class technological capabilities and media-buying and campaign management expertise that saves advertisers much more money than the agency’s fees.  In essence, a good online media agency should “pay for itself” through generating many new customers and significantly reducing customer acquisition costs for its clients.

The author, Paul Anders Schwamm, is a well-known marketer, with seventeen years of online marketing experience.  Paul started Globalis Media Inc. in 2006 as an advertiser-centric media buying agency, with the mission of saving money for online advertisers.  Globalis Media consistently out-performs other media agencies and in-house media buying teams.  Globalis Media is a Certified Google Partner agency, using world-class ad technology, including leading programmatic platforms, together with best practices in media buying and campaign management.  Please feel free to ask us for a proposal regarding how we can help your business acquire more online customers at significantly lower customer acquisition costs.