Overview
Challenge
An industry-leading water technology and process company helping industries such as food and beverage, power, and chemical processing solve their toughest water, wastewater, and process challenges, engaged Seer to help them better understand the impact of Paid Search.
This client relies heavily on the Paid Search channel to reach targeted audiences, and wanted to better understand the impact the channel has on their business and the return on investment they were receiving from this marketing channel.
Additionally, this client wanted to understand how the Seer Paid Search team’s recommendation to increase budget by $8,000 for two months would impact their ROI.
Approach
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Our hypothesis was that the $8,000 increase in Paid Search budget would yield a positive return on investment due to the high value of a single website Lead.
We recommended conducting an incremental spend analysis to understand how any additional dollar increase in Paid Search budget would affect our Lead form submissions and how much additional budget would be beneficial before we would start seeing diminishing returns. Based on those findings, we would then forecast out what the impact of the $8,000 increase in Paid Search budget would be on ROI.
Seer looked at three specific business areas when determining the value of Paid Search for the client’s business and recommendations made by the Seer team.
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When budget (and by extension spend) is increased, how are conversions and leads driven from Paid Search affected?
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When we don’t meet the monthly budget/spend (underspend), how are conversions and leads affected?
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While this client operates on a fixed monthly budget, Seer recommended they increase their budget by $8,000 for two months during their busy season. We wanted to understand how this increase would impact Lead form submission and ROI.
Execution
We used Google Analytics to pull conversion data and combined that with budget and spend from Google Ads and Microsoft Advertising. Because we had previously worked with the client to determine the value of a website Lead based on time to conversion, close rate, and the overall value of this type of Lead to their business, we were then able to calculate the amount spent per lead and how much an additional increase in budget would yield.
In Power BI, we used a forecasting model to determine how a budget increase of $8,000 over the next two months would impact their Lead generation, and therefore; their bottom line.
Additionally, for this analysis we worked closely with our Paid Search team to verify the forecasting model outputs validity and understand the value they expected from increasing the budget as well as other recommendations they felt would support the client's business into the future.
Results
Not only did we find that the client had left $1.2 million in Leads on the table when they had underspent their Paid Search budget, but we also found that in months where we overspent budget by no more than $5K, we saw additional conversion value generated of $668K.
Seer recommended that the client increase their budget by $8,000, with an expected return of 73 additional leads, resulting in $2.2 million in additional revenue.
While the client has been unable to act on this recommendation due to other business constraints, this analysis showed the value of Paid Search for the business and has armed the client with valuable information to negotiate budgets in the coming year.