The High Cost of Attracting After-hours Customers on Google

Marketing can be expensive. With plenty of competitors after the same customers that you are trying to target, everyone is bidding right up to the edge of what they can spend while still turning a profit. If you aren’t careful, the battle for clicks can leave you in a place where you longer see a positive return on your investment. 

With that in mind, it’s crucial to closely monitor your ad spend and find any opportunity possible to become more efficient. Service Direct recently did an analysis and discovered an opportunity to fine-tune ad campaigns. 

What Time is It?

In the digital marketing world, it’s easy to fall into the trap of thinking that all clicks are the same. After all, as long as you are placing your product or service in front of potential customers, sales will follow – right? 

Unfortunately, in the real world, it’s not that easy. Some clicks are far more valuable than others, and attracting the best clicks for the lowest price is ultimately the name of this game. As recent research has uncovered, the time of day plays a powerful role in your clicks' value. If your current ads are running with the same bids 24 hours a day, it might be time to take a closer look at using a dayparting strategy. 

The Basics of Dayparting

Even if you aren’t familiar with the term, the concept behind dayparting is rather simple. The idea here is to segment your ad campaign based on time of day to optimize your results. It turns out that ads can’t be expected to perform at the same level around the clock, so you need to fine-tune your whole approach to reduce wasted spend. 

The points below summarize what was found after reviewing data on around $1.8M in ad spend. 

• When viewed as either business hours clicks or after-hours clicks, those received during the business day converted far more frequently.
• The conversion rate on clicks during the business day was more than triple what was achieved after-hours (11.8% to just 3.5%.)
• After-hours clicks were less expensive than clicks during the business day. The dramatic conversion rate difference left ads with a much higher overall cost per conversion ($129.80 after-hours, $48 during the business day.)

These results don’t leave much to the imagination. Simply put, clicks that came in during business hours fared much better from a return on investment standpoint. There were still customers to be found after-hours, but they cost far more to acquire. The poor overall performance of after-hours ads means making significant changes to the way campaigns were designed and run. 

Making Adjustments

Given the dramatic difference in return on investment between daytime ads and overnight ads, it’s obvious that some improvements could be made from a campaign management perspective. There are three possibilities:

• Stop running ads after-hours. This is the urge you may feel once you discover how poorly your after-hours ads seem to fare. Rather than trying to optimize the way your ads perform, you might feel like simply shutting them down at a certain time each day. And, to be sure, this is a viable option. For some businesses, the potential gains to be found from optimizing those after-hours ads may not justify the effort. Instead, you may opt to turn off your ads at 6 PM local time, or whatever cutoff is justified by the data. With that said, before you turn off your nighttime ads, consider taking a look at a couple of other approaches. 
• Lower your bids. For an easy place to start, simply try to lower your bids overnight to a level that will bring your cost per acquisition down into an acceptable range. Of course, this will take some experimenting, as you will have to see how many clicks come in at various bid levels. If nothing else, this method will allow you to immediately reduce your spend on those less-effective clicks while you track performance and decide how to proceed over the long run. 
• Change your approach. In addition to altering your bidding strategy, you can also look at the messaging used in your ads. Specifically, consider asking potential customers to fill out a form rather than making a phone call. It seems that customers are less likely to pick up the phone and call after-hours, even if it is made clear on the website that the business is open. By leading them to a form to fill, it may be possible to bump your conversion rate in the right direction on these after-hours clicks. 

Eternal Optimization

Your ad campaigns are never perfect. Even if you have spent countless hours optimizing the way they run, there is always room to get better. This research is a perfect example of how even a profitable Google Ad campaign can be tightened up to perform at a higher level and result in a better ROI. Whether it relates to dayparting or any other kind of optimizing strategy, never make the mistake of resting on your laurels when it comes to digital marketing. With persistent testing and an open mind, great things are possible.