search marketing

Bing Ads: Are They Worth the Trouble?

While Google is the most popular search engine on the web, believe it or not, a pretty good amount of people use other search engines as well. One of these is Bing.

If you're advertising your goods or services online using paid search marketing, also known as pay per click (PPC) advertising, then you may want to consider using Bing Ads for some of your efforts. Despite a lower user base, there are enough people using Bing to make it worth your while.

Bing also offers some advantages for advertisers compared to Google.

Below we'll tell you about some of the advantages of advertising with Bing and why it may just be worth the trouble after all.

1. Cheaper and Less Competitive

One of the best things about using Bing Ads is that not many other marketers are. This means that there will be less competition for you and it also means that Bing offers lower costs per click (CPC).

If you're a business that is advertising on a budget, then you'll likely find it much easier to manage your costs with Bing than you would with Google AdWords, which can sometimes be pretty pricey.

2. Higher Conversion Rates

Perhaps because Bing users are less computer savvy, higher conversion rates are common with Bing Ad campaigns as well. Users are more likely to click and convert on Bing Ads than with Google AdWords campaigns. Because of this, if you're serious about trying to optimize your conversion rates, then you may want to consider using Bing instead

This is a big benefit because even though there may not be as much traffic overall with Bing, the traffic that does see your ad will be more likely to convert or become a customer in the end.

3. Better Targeting Features

While Google AdWords does have quite a bit of targeting features and options for optimizing and tweaking campaigns there are places where Google could improve. Luckily, Bing picks up the slack exactly where many of the Google AdWords issues are.

For example, with Bing, you'll have much more control at both the campaign level and at the ad group level. You'll be able to target location, scheduling, language and network settings in both areas.

Additionally, with Bing, you'll also have more extensive options for choosing what devices to target and what search demographics you want your ads to be shown to. 

4. More Search Partner Control

With Bing, you'll also have more control over search partner settings. While Google gives you the option to show ads on search engine results pages (SERPs) only or on SERPS and search partners, Bing offers you the option to choose one or the other, or both.

This can be a huge plus for businesses who find that their ads fare well on search partner pages but not so well in search engine results.

5. A New Traffic Source

Another reason you may want to consider using Bing Ads in addition to Google AdWords is simply that it opens up new options for who you can target with your advertising campaigns.

Typically, the average internet user chooses a search engine and sticks with it. This means that if you've been running your ads on Google for a long time, many people will have likely seen your ad multiple times before. If you want to reach completely fresh faces, using Bing is a great way to do it since the audiences will overlap very little.

Deciding If Bing Ads Are Right For Your Business

While many businesses will want to use Google AdWords, there are cases where Bing Ads can make a good choice as well, particularly when used in conjunction with Google ads.

You'll want to consider the advantages listed above carefully when deciding if Bing is right for you. Make sure you do some testing and experimenting with both ad networks before you make the final call.

Looking for help with your eCommerce marketing strategy? Contact us today to learn more about what we can do for you.

LTV: The Importance Of Knowing The Value Of Your Customers in eCommerce

Being in the business for well over 10 years I am always surprised how many eCommerce clients cannot answer the question "what is the lifetime value of your customers?"  Usually in my initial prospecting calls with somewhere within the second half of the call I ask this question.  At least 50% of the time I hear the answer: "no."  It does seem like most eCommerce companies understand the value, but don't always have the analytics expertise to calculate this.  Of course, you also have the eCommerce companies in their infancy that just don't have the customer data to support estimating anywhere near an accurate lifetime value.

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What does "customer lifetime value (LTV)" mean?   Essentially it's the total value a customer will contribute to your company over their lifetime.

Why is it important to know the lifetime value of your customers?  First, it tells you how much you can spend to acquire a customer without losing money.  Second, it gives you a baseline to start from while you make changes to increase the value of each customer.  There are a lot of companies out there that never make it because they don't know their customers lifetime value.  They are paying $75 to acquire every new customer, but the average customer might only drive $50 in revenue.  Understanding this is crucial to growing a successful eCommerce company over time.

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There are two primary methods to calculate this.  One is based on historical data (in which you need a lot), and one is based on predictive modeling.  Which way you need to use will depend on how many customers you've had as well as how long you've been in business.  More than likely for at least the first 2-3 years you'll be using predictive modeling, but as your actual data set grows you can integrate more historical data until eventually, you get to a point where it's entirely based on your own metrics.

If you're using historical modeling, you have the opportunity to segment even further, maybe by acquisition channel or demographic data.  Now you can find which of your customer sets have a higher lifetime value than others.  This allows you to focus on acquiring customers that are more valuable regarding long-term revenue they bring in.  Marketing to the "right" customers will help improve your customer acquisition metrics.  There's a great infographic I found from RJ Metrics illustrating this (see below blog)

As you continually do things like marketing to the right customers, adding new products to your website, improving your cross-selling approach you can continue to increase the lifetime value of your customers giving you more profit and more you can spend to acquire new customers.  

Now just because you know the answer to this question doesn't solve everything.  One of the significant challenges for eCommerce companies, especially those in the first 1-3 years of their business is that they don't have enough existing customers to offset the loss to acquire a new customer.  Here's what I mean by that.  If the lifetime value of your customer is $100 over a 2 year period and to get to $100 in revenue that customer has to place 4 orders and it costs to $50 to acquire that customer; initially you lose money.  Yes over a two years period you'll still make a $50 profit from that customer, but you might lose $25 for the first 6-12 months.

Look at Amazon and Jet.  They lost tens to hundreds of millions growing their customer base initially while continually increasing the customer lifetime value until they can eventually be profitable.  Now this indeed takes a lot of investment capital, and there aren't many companies in this position, but it's an excellent example of what it takes to grow in the eCommerce space now.

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Early on in the years of pay per click on Google, Yahoo, and Bing, it was relatively easy to make a "profit" from a first order.  As the market became more competitive rarely now do we see this from eCommerce companies on non-brand search keywords.  Same goes for Facebook ads.  Facebook advertising has doubled in cost each year as it's gone from having unsold inventory to completely selling all ad spots.  Understanding and improving your lifetime value is continually increasing in importance to the success and growth of your eCommerce business.  

If you've been in business for 3, 4, 5 years or more you might have enough repeat customers that you can cover your loss to acquire new customers and your eCommerce business is still profitable.  Many eCommerce companies and startups don't have that luxury though, and they are operating at a loss until they can start getting those repeat orders in.  Depending on how long that cycle is for your customers to make a second or even a third purchase, this can be challenging.  As an eCommerce company, we're all trying to get to that point, where repeat customers drive the profit and capital to continue losing money on a first purchase to acquire new customers.

Stay tuned for our white paper where we'll show you exactly how to calculate the lifetime value through both historical and predictive modeling.  

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