January 7, 2017 | Sarah Danks
PPC for Lead Generation
As marketers focused on lead generation goals, we’re always interested in anything that can help us increase our clients’ conversion rates.
Since the majority of our clients are in the professional services realm, phone calls are a huge part of our PPC lead generation strategy. Most often we send online traffic to custom landing pages so visitors can fill out a form, or we’ll use the click-to-call option in standard text ads…
…but these days there’s another option: call-only ads.
Instead of sending mobile traffic to a landing page, where they’ll have to fill out a form or click on the phone number to speak to someone, why not bypass the landing page entirely and have them call directly from the paid ad?
We want web visitors to contact our clients anyway — so why not eliminate the middle man (i.e., the landing page)?
Sounds brilliant, doesn’t it? But, we have to wonder: do call-only ads work as well as they’re purported to?
Enter: Call-Only Ads…
We highly respect Larry Kim over at Wordstream, and as many know he’s a huge proponent of call-only ads. He says these ads work because “Google is effectively removing the leakiest part of the conversion funnel.” (read: landing pages)
You’d think if the only option for searchers to take is calling you directly — instead of getting sent to a landing page where they need to take some other form of action — that you’d see amazing conversion rates.
But, don’t just assume call-only ads will outperform standard ads in your PPC campaign. In our experience here at ThinkSEM, we’re finding that our call-only ads don’t perform nearly as well as our standard text ads, or in some cases, not all.
We have our theories as to why this could be happening.
…But How Well Do They Work?
So, why don’t call-only ads work as well for us?
First of all — these ads are extremely simple. You can’t write a custom headline; it’s always “Call: (xxx)-xxx-xxxx.” After your set-in-stone headline, you only get two lines of text (35 characters each) to write out your custom messaging:
Simple and straightforward can be a boon in marketing — especially for mobile visitors, where screen size, amount of “real estate” shown, etc. is at a premium — but are these ads as effective as their “standard” counterparts?
There are no enhancements, no extra messaging.
This doesn’t give you a lot of room for creativity, keyword and message matching, or customization of copy based on queries.
Secondly, in our experience it’s much more expensive to use call-only ads.
E.g., let’s say we use the same keyword set for our call-only ads as we do for a standard ad to show on mobile devices.
Using standard ads, we can write custom headlines and accompanying text. Plus we can play around with a myriad of expanded text ad options, in order to show enhanced ads that include:
- Two 30-character headlines,
- (up to) 80-character description,
- callout extensions,
- structured snippets,
- location extensions / review extensions
- two optional path fields,
- and even click-to-call.
When we’re using call-only ads, we can’t add anything to enhance the ad — we get a phone number and two lines of text.
But that’s not all…
Jockeying for Position
…because, thirdly: without ad extensions, you lose positioning. See, ad extensions make up a part of your Ad Rank. Ad Rank is what places you in the pay-per-click auction (based on such criteria as Quality Score of keyword, what’s the keyword bid, “expected impact” of ad extensions included, etc).
When comparing a standard ad with ad extensions and one that’s call-only: if the keyword is the same, and the keyword bid is the same, the standard ad will place higher on average.
Not only that, but because it’s an expanded ad (with extra information) the engagement will be better.
And let’s not forget an important aspect of this: BIDS. The call-only ad example yields much higher bids, again, ostensibly because we can’t use enhancements.
In fact, Google even says call-only ad bids will be higher:
“Because call-only campaigns only allow clicks to call, you’re able to bid for calls to your business instead of clicks to your website. This means your cost per click bid should match the value you would place on a phone call from your ad.”
But, you might argue — the call-only ad will funnel a more qualified lead, since they’re ready to speak with someone. Ergo, it’s okay to pay a bit more, right?
Hold that thought.
Let’s expand on our aforementioned comparison. When using the same keyword, and the same bid on that keyword, here are the results:
- Keyword A = $10.00 per click
- Average position = 2 (mobile traffic only)
- Keyword A = $10.00 per click
- Average position = 4.5
- (ended up having to increase keyword bid to $25.00 to gain position 2)
So therein lies the rub.
When using the same keyword, and targeting the same traffic, we’re forced to drastically increase bids when using a call-only ad in order to get to the same average position as we’d achieve with less money using a standard ad.
Cost-per-click (CPC) goes way up with call-only ads — we’ve seen it up to 2.5x as expensive! We think this is because of the lack of ad extensions. Without ad extensions, you have to boost your Ad Rank by significantly increasing your max CPC for a given keyword.
This begs the question: are you getting “penalized” by not using any add-ons/extensions? Is Google making us pay higher fees when we cut out the landing page and head right to the phone call?
Again, you can argue that call-only leads are stronger, since a click means someone’s ready to talk. Right?
We’ve found people hang up — i.e., bounce — a lot with call-only ads. We theorize the high hang-up rate is due in large part to visitors still not being used to the fact that when they click that headline, their phone automatically starts calling.
Or, perhaps they’re not far enough along in their “sales” process yet to make that call, or it could even be fat-finger error — keep in mind call-only ads only show on devices able to make a phone call.
That said, if you have a big enough budget, maybe call-only ads could be just the thing to boost your paid search endeavors.
Budgeting for Call-Only Ads
Here’s another example.
Using a standard ad:
- mobile audience gets 100 clicks, at $10 per click
- 20 turn into leads
- click-to-call conversion rate is 20%
- $50.00 per phone call
- total spend = $1,000
Using a call-only ad:
- mobile audience garners 100 clicks, but your CPC went up to $25 per click
- you might get 40 successful phone calls (i.e., they talked on the phone vs hanging up)
- call conversion rate is 40%
- $63.00 per phone call
- total spend = $2,500
So the call-only ad is only $13.00 more expensive per phone call than the standard ad, plus it’s got a higher conversion rate — that’s not bad! Especially when you consider that you’re cutting out the need for a landing page.
But, what if this isn’t about the number of leads or even the cost per lead…
…rather, let’s make this about BUDGET.
As in, what if your monthly allowance is only $1,000? In that case, higher conversion rate aside, you are still paying more for conversions and receiving fewer leads for that same $1,000.
It All Depends on Your Goals
Of course, there are those who’ll say that the higher CPC is worth it, because visitors from call-only ads are phoning you directly — no muss and no fuss with landing pages and online forms.
But, just because you generate a “click” with a call-only ad does not mean it’s a successful call.
Moral of the story: is it worth going to call-only ads when you know you’ll have to increase the amount of money you’ll spend to get to the same “position” as you do with standard ads, and there’s also a high hang-up rate (bounce)?
We’re not saying don’t do call-only; we’re not saying do them. But, before you delve into this new ad realm, you’d best know the pros and cons — and how they could work (or not) for your business and clients.
- We’re not saying call-only ads don’t work — we’ve seen them do very well — BUT, the cost-per-click is much higher than that of standard ads.
- Call-only ads are quite strict in their format — there’s not a lot of room for creativity.
- No ad extensions.
- When you create a call-only campaign, you’re no longer giving mobile visitors the option of calling or visit a landing page; rather you’re forcing them to call. And, because of the high number of hang-ups (read: bounces) we see, we can surmise people either weren’t thinking they’d be calling or they clicked by mistake (fat-fingering).
We’ve also seen click-through rates drop with call-only ads. Is this because visitors are put off by the fact that there’s only ONE action to take (calling)? Is it asking for too much, too soon?
When comparing mobile traffic from standard ads with call-only traffic, we see that traffic is down, clicks are down, and costs are higher…
…so is it worth it??
- Call-only ads allow visitors to bypass the landing page. Cutting out one of the major factors in the conversion funnel can greatly reduce friction.
- If you don’t have the financial resources to build custom landing pages, call-only ads are a nice way of bypassing that cost. As referenced earlier in this post, you can cut-out the “middle man.”
Again, we’re not saying don’t use call-only ads. In our experience they’ve not been as cost-effective for OUR clients…
…but where we see these ads making more sense are within RLSAs (remarketing lists for search ads). You can show these simple ads to visitors who’ve already converted, OR they’ve at least already been exposed to your brand.
If they’ve seen you before, they’re aware of who you are and will therefore be more comfortable bypassing the landing page experience and calling you “cold” — or warm, as it were.
Yet again I say unto thee: we’re not advocating for or against call-only ads! We’re just saying they haven’t worked the greatest for the majority of our clients, and we wonder if they’re worth it for us.
That said, if you know what you’re doing — and have ample budget — they might perform really well for you. It’s all about knowing your business goals and how to develop a strategy that will make them come to fruition (hopefully under budget!).
What’re your experiences with call-only ads???