How Micro-Relevance Performs Across 20,000 Ad Groups
September 9, 2016
Did you know that consumers who have been served contextually relevant ads are willing to pay more for the advertised product? They also favor the brand up to 40 percent higher after viewing a contextually relevant ad compared to other ad types.1
Knowing this, digital marketing organizations in 2017, whether inside a brand or at an agency, will continue to focus on building contextual relevance for consumers with their creative strategies, media mix, targeting decisions, and call to actions. In fact, Panos Bethanis, the CEO of Survey.com, a business built on the smart application of data, has said: “For all marketers, the Holy Grail is achieving relevance with consumers.”2
What’s more, relevance isn’t just a subjective concept any more—it’s an actual measurable element across many advertising platforms. Google has, for many years, calculated a Quality Score to determine when and at what cost they display search ads. More recently, Facebook has exposed its relevance score measurement for each ad, which takes early performance into account against objectives and specific audiences.
Here at Balihoo, we’re all too familiar with relevance as a strategy—our business has been built on it. Our software uses nightly data from national brands to set up, automate, and optimize paid search, display, and paid social campaigns across all of their markets—whether they have one hundred or ten thousand locations.
As an approach, the daily triggering of tens of thousands of localized campaigns allows the brand to decrease cost-per-click by up to 60 percent when compared to their national “blanket” digital campaigns. Why? It’s not because these local ads use different branding, messaging, or endpoints—they don’t. It’s because every effort is made by both the software and by the humans behind it to produce the most relevant ads possible for every single impression.
How do we build relevance? Balihoo software layers geographic, message, and daypart relevance to build an unlimited quantity of niche campaigns that adjust to the day’s conditions. We call this Micro-Relevance. A micro-relevance strategy, whether executed manually or by software, tends to improve measurements of quality while boosting consumer response rates. Our advertisers then see a domino effect across performance metrics.
Want to know how this strategy might work for your brand? Let’s take a look at the raw data—real stats from dozens of brands that have used Balihoo to execute micro-relevance at scale.
Let’s start with Insurance and Finance marketers, which represent the largest segment of Balihoo customers. Despite a dominating national advertising presence, large insurance providers have become increasingly aware of the importance of hyper-local search campaigns that drive customers to their agents. Like other industries with physical locations or defined territories, they’ve begun to discover that a PPC approach that creates micro-relevance for the searcher increases ROI by decreasing cost-per-lead and ratcheting up conversions.
Check out the average CPC for insurance brands using an enterprise bid management platform3 versus insurance brands using Balihoo, which is built to automate hyper-localization and segmentation of paid search.
Vehicle insurance brands using micro-relevance as a PPC strategy see average cost-per-click drop by up to $33. But how does this actually affect the bottom line? Are the clicks obtained through micro-relevance valuable? Are these cheap leads real? The answer is YES. In fact, a national insurance brand and their agency saw conversion rates jump by 80 percent and cost-per-lead plummet by 60 percent simply by employing a hyper-local strategy and the automated Balihoo software behind it.
But, how about Beauty and Fitness? How has that industry performed through the application of micro-relevance? Think about it: When it comes to gyms, hair salons, and med-spas (all industries representing Balihoo customers), consumers want search results that directly correlate to their location or a specific location of their choosing, such as a neighborhood or suburb.
Because of this, we fully expected to see greater results with local relevance in this industry, and we weren’t disappointed once we analyzed the data across Balihoo customers. Take a look at what we found:
Clearly, approaching paid search with a local strategy in hand can improve results for even the largest brands in this industry.
To learn more about a micro-relevance strategy, how to execute it, and the real results seen by national brands, download Balihoo’s latest ebook, What is Micro Relevance?
- IPG Media Lab and ZEFR, The Power of Relevance: Content, Context and Emotions, 2016
- Huffington Post, “What’s Missing in Marketing Today: The Human Touch,” August 2016
- Kenshoo Industry Spotlight Infographic, Financial Services Insurance, 2014