As a PPC manager, there is nothing better than an account that runs smoothly.
The campaigns are exceeding their lead goal, while still staying within the cost-per-lead benchmark!
Then suddenly the fun stops during a meeting. The client says, “We’re spending a lot of money on PPC. You say leads are coming in, but we’re not seeing sales. Why?”
In the eyes of the customer, it’s easy to blame the PPC channel whenever there is a change in performance.
But as PPC managers (whether working at an agency or in-house), we don’t always have insight into what happens after a user becomes a lead.
Below are some top reasons why PPC leads might not convert.
(Spoiler alert: they’re more common than you might think!)
1. Marketing and sales teams disconnected
A common observation in many companies: marketing and sales don’t talk to each other.
That is, until a problem arises and everyone points fingers.
The common sales cycle is expected to look like this:
Image created by the author, July 2023
What is not shown or understood is everything that happens in the middle of this process! (More information in section 2).
Image from Shutterstock, July 2023
This complicated shopping journey is like trying to peel a huge onion, the kind that brings tears to your eyes.
It could be an overwhelming concept to think about.
Below are a few questions every team should consider to get the conversation started and get the onion off the hook.
- How long is the sales cycle actually compared to my expectations of an ideal sales cycle?
- When does lead responsibility shift from marketing to sales?
- Are there any key trends emerging in unqualified leads?
- How long does it take for sales to contact an initial lead?
- Are there any sticking points discussed between sales and an initial lead?
This is a more strategic conversation that really has nothing to do with PPC, but with the business as a whole.
2. Ideal vs. The actual timing of the sales cycle is misaligned
Do you know the average sales cycle timeline of your client or company?
Most importantly: Have you ever asked the sales team As have they come to this conclusion?
I have noticed this disconnect all too often working as both an agency marketer and an in-house professional:
The timing of the sales cycle is based more on assumptions than on actual data!
As a PPC manager, data is key when it comes to making decisions.
So, sales cycle timelines that aren’t based on real data sound crazy, right?
The problem of not knowing a company’s average sales cycle can be a detriment to any PPC program, but not because of the PPC program itself.
Let’s analyze an example here.
Image created by the author, July 2023
In this example, a PPC program reaches its goal of 50 leads per month. The assumed sales cycle timeframe communicated is 30 days.
30 days later, the sales team accuses marketing of leads not converting into paying customers.
As a PPC manager, dig into the root cause of the problem right away:
- Keywords misaligned?
- Is the target audience qualified?
- Is the advertising text in line with the offer?
After much research and conversations with the sales team, it turned out that the average sales cycle is 60-90 days. Not 30 days.
So what is the result of this discovery?
The fact that leads don’t convert after 30 days isn’t necessarily a PPC problem. The user is probably one-third or halfway through the purchase journey!
Now that there is real data behind the sales cycle timeline, where does one go from here?
The key is to reset expectations in the PPC program. For example:
- If a PPC program brings in 50 leads in a month, the actual termination of quality leads won’t be known until 60-90 days later
- If a client is asked to increase their budget by 50% overnight, the lead volume is likely to increase. That doesn’t mean that the sales cycle timeline also accelerates.
This section is in direct correlation with point n. 1.
There will always be a transfer of responsibilities from marketing to sales.
In this case, the role of marketing is to attract qualified leads. The role of sales is to convert them into customers within 90 days on average.
The other key is setting realistic expectations with your sales team. Most importantly, communicate your results – and often.
3. Sometimes, budget is the main issue
When was the last time an unqualified lead was audited?
I recently performed this exercise with a client. We specifically looked at PPC leads because the team was told they weren’t qualified.
Already sensing a theme here?
The results obtained were staggering:
- 85% were not qualified due to “budget”.
- 10% were not qualified due to lack of contact/follow-up from the sales team. (What?)
- 5% were unqualified because the company was unsuitable.
Even after a few years of volatility in the market, much of which can be attributed to external factors such as the pandemic, buyer behavior continues to change.
While many businesses may be genuinely interested in a product or service, they simply may not have the budget right now.
Are budget concerns a reason not to qualify those particular contacts?
A strategic change could be to classify these leads in the “budget issue” category.
While it may take a while for most businesses to return to a sense of normalcy, these companies previously considered “unqualified” could become your best customers.
The key is to follow through if budget is really the only issue.
Another strategic shift might be to examine your pricing model.
If the majority of leads are unqualified due to budget, this may be an indicator of perceived market value, not that PPC isn’t working.
4. High volume keywords generate ineffective leads
Quantity of leads doesn’t always equate to quality leads.
It’s usually smooth sailing when campaigns are working and meeting lead volume goals.
But when you’re told that leads aren’t converting, even after moving from sections 1-3, it’s time to take a deeper look at your campaigns.
When diving into PPC campaigns, it’s easier to find an outlier if a few keywords drive the most leads. Start there.
If a campaign is bidding on general, high-traffic keywords, the problem may be with the keyword itself.
Ask yourself these questions:
- Is the keyword too broad in nature?
- What is the purpose of the research?
- Who is my target audience?
- Are there negative keyword lists available?
Sometimes making simple changes to your target audience in Search Network campaigns can produce effective results.
For example, let’s say your campaign bids on the term “industrial double-sided tape” with no demographic or audience parameters.
Even if you know your audience is likely B2B manufacturers, a query like that is bound to get a lot of consumer impressions and clicks.
Why?
Because Google will show that ad to anyone who queries, regardless of intent.
As match types continue to relax, Google can now match a query based on a user’s perceived intent.
Someone might search for “heavy double sided tape” and be shown an ad for the original keyword “industrial double sided tape”.
It’s up to your targeting parameters to narrow down who sees the ad for this query.
While the number of leads may go down, the quality is likely to go up.
Find other ways to improve demographic targeting.
5. Sometimes, a company just isn’t a good fit
There will always be leads that just aren’t a good fit for the client.
No PPC program should be expected to generate 100% qualified leads. It’s simply not possible with today’s automation in PPC campaigns. Have you ever heard of Performance Max?
In relation to point 4, it’s always a good idea to reevaluate the keywords a campaign is bidding on to improve the efficiency of an account.
Go back to the basics and examine your original keywords against your search terms.
- Has the industry changed in the last few months or years and has the relevance of keywords changed as well?
- Are there other ways people are searching for your product or service that you aren’t bidding on?
Shifting your keyword strategy towards lower-volume, high-intent searches could lead to higher-quality leads.
However, a balance between quality and quantity of leads is still needed.
If narrowing down your keywords produces better quality but falls short in terms of quantity, it’s time to look for more ways to expand your PPC program.
Put it all together
When a channel like PPC is responsible for generating quality leads but fails to do so, it’s easy to panic or blame.
What isn’t always easy is taking a step back to evaluate all options, including getting other teams involved and asking tough questions.
Better questions lead to better answers and potential untapped opportunities.
It’s an opportunity to better understand the business.
Ultimately, these types of questions make you an invaluable asset to the company.
More resources:
Featured image: Andrey_Popov/Shutterstock
