Generate leads
To generate high-quality leads at scale, top advertisers use the Google Ads Growth Formula's four-step, best-in-class strategy.
Meet the formula that will maximize quality leads for your business
There are many paths to success with Google Ads. The Growth Formula was designed to help you follow the most direct path to generating leads.
To help marketers drive results amid economic uncertainty and build resilience for the future, download our condensed best practices guide.
Set objectives
Pinpoint and align your business objectives with your team. Then you can make sure your marketing, media, campaign objectives and KPIs are working together to achieve that goal.
But first, we'll help you outline your company's lead-to-sale journey, which is the first step in understanding how to improve lead quality and drive more growth for your business.
Some conversions are worth more to your business than others. Mapping out your lead-to-sale journey can help you identify the key stages in your funnel and determine the average values of your conversion actions so you can effectively use a value-based bidding strategy.
First, consider:
- What are the highest-priority stages in your sales cycle? (Typically 3–6 actions)
- Do you have conversion tracking set up?
Then, get your numbers handy:
- What's the average revenue you receive from the last stage in your lead-to-sale journey? (e.g. sale, policy signed, subscription)
- What's the conversion rate between each stage in your lead-to-sale journey?
Calculate the value of your conversion action
Use this conversion value calculator to identify the events you should bid towards. Enter the key stages in your lead-to-sale journey that takes your customer from a lead to a sale. We'll do the math at each step to show you the most valuable conversion actions to bid on in Google Ads.
To view the full experience, please go to desktop.
Align with executives like the CEO to make sure you fully understand their main business objectives. This usually falls into one of three categories: market share, revenue or profit.
To create long-term sustainable growth, shift your focus from driving lead volume or revenue to profit.
And keep in mind that great business objectives are measurable, time-bound and raise the bar above what you're already achieving.
The marketing objective should be informed by the bottom-line business objective and signed off by the CFO or CMO. In this case, we'll focus on generating high-quality leads as the primary marketing objective.
This positions marketing as a profit centre, rather than a cost centre.
Media objectives help you meet the marketing objective—which, in this case, is driving high-quality leads at scale. They're usually set by the digital marketing team, and break down into two parts:
Performance objectives focus on the bottom of the funnel, measured by KPIs like phone calls and form submissions.
Brand objectives focus on the mid-upper funnel and drive factors like ad recall, brand awareness and brand interest.
Best-in-class advertisers look beyond lower-funnel performance marketing, and focus on a full-funnel strategy—with brand goals that drive lower-funnel outcomes.
Campaign objectives are the KPIs used to gauge the success of a specific marketing campaign. We recommend you keep a close eye on return on ad spend (ROAS).
If you're measuring proxies like CPA or CPL, it's imperative to shift focus to actual business outcomes, with KPIs like return on ad spend (ROAS) or customer lifetime value (CLV).
EXPLORE HOW MIKE DOES IT
See how Mike sets objectives for Best Insurance
Meet Mike. He's the marketing manager for Best Insurance, a national home and auto insurance provider.
Map the lead-to-sale journey
Mike maps each touchpoint in their sales cycle: from lead to marketing-qualified lead (MQL) to sales-qualified lead (SQL) to closed sale.
BEST INSURANCE LEAD-TO-SALE JOURNEY
Knowing the average value of a closed sale is $5,000, Mike works backwards to figure out that if 4% of SQLs convert into closed sales, then an SQL is worth/valued at $200. He does the same thing from MQL to SQL to calculate the value of each step along the journey.
Now Mike uses that to optimize the entire lead-to-sale journey for the highest-value leads.
Know your business objective
Mike's CEO's business objective is to increase revenue by 20% by the end of Q4—from $20M to $24M. Now Mike also needs to check in with his CMO.
Align on your marketing objective
Mike's CMO's marketing objective is to increase sales-qualified leads to $5M (a 25% boost) by the end of Q4.
Now knowing both goals, Mike can clearly see how that will help their CEO hit her goal.
Set your media objectives
Mike sets two media objectives for Best Insurance:
His performance objective is to get 50K sales-qualified leads through Google Search by the end of Q4.
His brand objective is to use YouTube to drive a 25% increase in branded search demand.
Together, those should help his CMO get that 25% boost she's looking for.
Pick your campaign objectives
Since Mike has two media objectives, he sets a campaign objective for each of them:
For his performance objective (50K sales-qualified leads), Mike wants to drive 200K conversions at a 120% target ROAS in Q1, with bookings from new customers.
For his brand objective (25% increase in branded search demand), Mike wants to capture 59M unique impressions at an $8 CPM over the same period.
Get ready
Success is built on solid foundations. Make sure you have the big three in place: privacy-safe measurement, a value-based bidding strategy and powerful creative.
Over the past few years, users' concerns over the usage of their data and increased industry privacy regulations have made the long-term future of digital measurement more challenging.
A strong measurement foundation starts with your most valuable data: your company's first-party data both online and offline. Why? It's high-quality, hyper-relevant to your customer set and privacy safe.
Collect your online first-party data
Use cookies that live on the same domain as your site, known as first-party cookies, to track conversions. This will help prevent potential conversion loss from browser cookie restrictions. It's best to avoid using third-party cookies, which are restricted by some browsers.
Marketers who effectively use their first-party data can generate twice the incremental revenue from a single ad placement.1
Even when you've built a strong first-party data foundation, gaps in measurement may still occur due to movement across devices, browser restrictions and varying content choices. Improve the accuracy of your conversion measurement in a privacy-safe way with enhanced conversions for web.
Advertisers who use enhanced conversions for web see an average increase of 17.1% in YouTube conversions.2
Connect your offline first-party data and measure the full journey
From there, connect your first-party data (e.g. data in your CRM) with Google Ads to see who your highest-value prospects are, then use Google's machine learning to spend only on your highest-value customers.
Don't forget to upgrade to non-last-click attribution. Before filling out a form on your website or calling for info, people may click or interact with several of your ads. Instead of giving all the credit to the last thing they saw or interacted with, non-last-click attribution assigns credit to the earlier customer touchpoints that helped influence the ultimate conversion.
When compared to last-click attribution, data-driven attribution typically delivers more conversions at a similar cost to other attribution strategies.3
Fill in the blanks to find the highest-quality leads
Now that you're collecting and connecting your first-party data, help Google fill in the blanks by indicating your most valuable customer actions (from the lead-to-sale journey value calculator in step one) and their associated values. These can be imported as unique conversion actions.
Compare apples to apples
Consolidate platforms to bring all sources of customer data into one place. As your data scales and your process becomes more automated, this will be even more important.
1 BCG, Responsible Marketing with First-Party Data, 2020.
2 Google internal data, March 2021–September 2021.
3 "Data-driven attribution delivers better results than last-click," Google, April 17, 2017.
Some customers bring more value than others, and your strategy should reflect that. In a perfect world, you'd be able to focus on your best customers and spend only on them—with 15% of Google searches being new every day, it's an impossible task to do manually.
Automated bidding strategies like target return on ad spend (target ROAS) and maximize conversion value (along with broad-matched keywords) enable you to bid to the value of each customer—not just how much it'll cost to acquire them.
Advertisers who switch their phrase and BMM keywords to broad match in campaigns using a target ROAS can see 12% more conversion value.4
4 Google internal data, July 2020.
Combine automation with strong creative. Research backs up what we know to be true: the creative aspects of an ad (like headlines) are still the most important element in driving sales and getting leads.
Advertisers who switch from Expanded Text Ads to responsive search ads, using the same assets, see an average of 7% more conversions at a similar cost per conversion. 5
Write more effective display ads
With responsive display ads (RDA), you upload your assets, and Google will automatically generate ad combinations.
By adding RDA to an existing ad group, on average we see 90% more conversions at a similar CPA.6
Create more effective YouTube ads
After lots of testing, we boiled down the essential rules for effective creative on YouTube. Make sure to share them with your creative team before they start on their next video ad.
5 Google internal data, June 2022.
6 Google internal data, Q3 2020.
EXPLORE HOW MIKE DOES IT
See how Mike gets measurement and automation in place for Best Insurance
Understand your customers better with privacy-safe measurement
Once Mike sets up data-driven attribution, he sees that one of his display ads had a bigger impact on sales than he expected. Even though more sales were coming from the search ad, most of those people had interacted with the display ad first.
So Mike increases the budget for display ads as a result.
COMPARING ATTRIBUTION MODELS FOR BEST INSURANCE
A data-driven model distributes credit differently for each interaction along the consumer journey.
Find your highest-value customers using automation
Mike wants to make $1M in revenue for $250,000 in ad spend, so he does three things:
He deploys a broad-matched keyword strategy to capture potential new searches he can't anticipate.
Next, Mike also uses responsive search ads to provide relevant and personalized ad copy.
Then, he sets a target ROAS of 400%—meaning Best Insurance will earn $4 for every $1 he spends on advertising. Google Ads automatically adjusts his bids to maximize his conversion value while reaching his target ROAS.
Stand out with powerful creative
After Mike increases his budget on display ads, he realizes he can add videos along with images.
He learns how to add a link to Best Insurance's existing YouTube video to also highlight video in his display ads.
Take action
Now that you've got best-in-class automation and measurement in place, let's take a look at different types of campaigns that can supercharge your marketing efforts.
Start with search ads
Search ads are a proven way to drive qualified leads as people search on Google and its search partners.
Since you’ve already prioritized your most valuable actions by setting up conversion actions in the last step, you’re ready to improve your ROI with Smart Bidding.
Good - If you don't have a cost-per-lead target (the amount you’d ideally pay for a conversion), start with a Maximize Conversions strategy.
Better - If you do have a cost-per-lead target, set up a target cost per acquisition bid strategy.
Best - To optimize for your return on every dollar, use target ROAS.
Feed the funnel
It's critical to generate more mid- and top-of-the-funnel demand. When done well, the mid-upper funnel is the engine for a brand's growth and profit.
Among consumers, 59% have found their favourite brands while doing things like watching videos on mobile, catching up on interests and reading through emails. Once they've discovered a brand, 85% of these people take a product-related action within a day.7
To engage these people as they "window shop" and discover new products to purchase, implement Discovery and YouTube campaigns.
YouTube and Discovery campaigns are better together. More than 60% of advertisers who combine video action campaigns with Discovery ads see incremental conversions at or below their original CPA.8
7 Google/Ipsos Connect, Consumer Discovery Study, US, December 2018, n of 2,001 US consumers aged 18–54 who go online at least once a month.
8 Google data, Global, February–March 2021. Data from 350 video action and Discovery campaigns adhering to budget best practices with a minimum of 20 conversions. Incremental conversions are defined as conversions earned at or below the marginal cost for a conversion.
EXPLORE HOW MIKE DOES IT
See how Mike takes action for Best Insurance
Capture existing demand
Mike switches from target CPA to target ROAS. This pivot helps him maximize profits and directly tie his goals to his CMO's marketing objective and his CEO's business objective.
Generate new demand
To generate demand with customers who weren't already looking for insurance, Mike launches a smart Display campaign to broaden his customer base and win new conversions using a fully automated Display campaign across the Google Display Network.
In addition, Mike also launches a video action campaign and harnesses the power of video to reach new customers across YouTube.
Evaluate and expand
As time passes, you'll better understand how your ads are performing. Use this information to optimize your performance, test new strategies and find more opportunities for growth.
Understand your customers' path to purchase
Unsure how many times a customer has to interact with an ad before purchase? We've got you. Go to "Tools and settings" in your Google Ads account and select "Attribution."
Meet your superfans
Now let's see what else we can learn about your top customers. Head to "Tools and settings" in your Google Ads account and select "Customer value." This will give you anonymous, aggregated consumer data showing what characteristics your top customers share.
Use pencil before pen
Before trying out new strategies, give them a test drive using drafts and experiments in your Ads account. Then stop by the Performance Planner to see the impact different budgets could make.
If your campaign is hitting its targets—but maxing out its budget—there's probably more room to grow. Check your impression share in your Google Ads account—it'll tell you how many impressions were gifted to competitors due to insufficient budgets.
Re-evaluate your campaign objectives
Now that you have more data, evaluate your performance goals. For instance, consider adjusting your ROAS. If it's too high, you could be missing out on additional sales. If it's too low, you could be sacrificing profits for volume.
Try to find the inflection point that allows you to maximize your overall profit.
Optimize for lifetime value
Evaluate customer lifetime value when planning your next steps; take customer lifetime value into account.
Figuring out the value of each of your customers isn't easy. You'll need to evaluate data from paid sources, organic sources and your other marketing efforts. Figuring out lifetime value will allow you to bid to the full value each customer provides your business.
To get started, find out how much you're earning from each customer. To do this, go into Google Analytics, open reports and select "Audience > Lifetime value."
EXPLORE HOW MIKE DOES IT
See how Mike optimized his marketing investments
Mike increases Best Insurance's online sales by 30% in Q1, but he thinks he can do more. He re-evaluates his campaign objectives for Q2–Q4, adjusting his target ROAS and increasing his demand-generation upper-funnel tactics. He's able to help his CMO pass her $5M goal by the end of the year.
Congratulations on completing the Growth Formula
Since it's not a linear journey, you'll want to revisit steps as time passes. We recommend bookmarking this website. We'll keep this guide up to date with the latest Google product announcements and launches to position you for continued growth.
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