Subscription models are one of the most successful business models. Service subscription revenue is expected to grow to $17.8 billion by 2022. As a result, competition in this business segment is becoming increasingly fierce. This fact means that companies must constantly strive to promote their subscription models and attract new subscribers. One of the most effective ways to achieve this is to use
Google Ads
. In this article, we will describe some steps on how to effectively promote your subscriptions with Google Ads and how to optimize performance.

Google Ads, formerly known as Google AdWords, has become an integral part of many companies’ digital marketing strategy. But how can you effectively use this powerful tool to promote your subscription model and subscription business? Learn how Google Ads works and how it can take your business to the next level.

One of the main advantages of Google Ads is that you can precisely target your audience. You can also adjust your budget as you see fit and track the results of your campaign in real time.

Google Ads is an online advertising service where advertisers pay to have their ads displayed in Google’s search results and network. You can increase the visibility of your website and drive qualified traffic to your site.

Basics of subscription models and subscription business

A subscription model is a business strategy in which customers pay for regular access to a product or service. Subscription businesses use this model to generate recurring revenue and build long-term customer relationships.

How Google Ads supports subscription models and subscription business

Target group approach

With Google Ads, you can customize your ads to the needs and interests of your target audience. This is especially useful for subscription models and subscription businesses, as you can target your ads to customers who are likely to be interested in long-term contracts.

Optimization of ad performance

Google Ads also offers tools to optimize your ads. You can test different versions of your ads and find out which ones work best. This can help you make your ads more effective and increase your conversion rate.

Retargeting opportunities

Retargeting, also known as remarketing, is another powerful feature of Google Ads. Retargeting allows you to retarget your ads to people who have already visited your website but have not yet made a conversion. This can be especially useful for reaching customers who are still unsure about subscribing.

Adaptability and scalability

Google Ads is also popular because of its customizability and scalability. You can always adjust and scale your campaigns as your business grows.

Maximize Google Ads customer lifetime value (CLV) in your subscription model and subscription business

No two customers are the same. Some marketing strategies or campaigns attract high-value customers, while others tend to generate low-value customers. Nevertheless, most advertisers set the same audience targeting and efficiency goals for all their marketing campaigns.

Calculating customer lifetime value (LTV) and mapping it back to the relevant acquisition channel, campaign, or keyword provides a deeper understanding of both search behavior and user behavior on your most valuable customers’ websites. These insights can serve as a basis for you to shift your budgets and more closely optimize these customer segments in your campaigns to maximize the return on your advertising spend.

Why do so many companies fail to include CLV in their Google Ads campaigns?

Calculating customer lifetime value (CLV) is a challenging task that many companies are unable to do effectively for a variety of reasons. These are some of the most common obstacles:

  1. Lack of accurate data: To accurately calculate CLV, you need comprehensive and accurate customer data. However, many companies have difficulty collecting or managing data, which can lead to inaccurate CLV calculations.
  2. Complexity of CLV: CLV is not just a single transaction, but includes all future revenues that a customer could generate over the entire duration of their business relationship. This calculation can be very complex and requires advanced analytical skills and tools that many companies do not have.
  3. Changes in customer behavior: Customer behavior can change for a variety of reasons, including changes in their personal circumstances, competitive factors, and market trends. These changes may affect the accuracy of CLV calculations.
  4. Too short an observation period: CLV requires a long observation period to allow accurate estimates. Companies that attempt to calculate CLV based on short time periods may produce inaccurate results.
  5. Insufficient integration with Google Ads: Even if a company is able to accurately calculate CLV, they may struggle to effectively integrate this information into their Google Ads strategy. This could be because they don’t know how to use the data, or because the CLV data is not well integrated with Google Ads’ existing systems.

It is therefore important that companies invest in the necessary tools and capabilities and improve their data management practices to ensure accurate CLV calculation and integrate it into their Google Ads bidding strategies.

Use the “customer acquisition” target project

The “Customer Acquisition” target lets you optimize your Google Ads campaigns for new customer acquisition. To do this, you can specify that either higher bids or bids for new customers only should be submitted.

You can choose between two corresponding modes:

  1. Place a higher bid for new customers than for existing customers (“new customer value” mode): Here, an additional customer acquisition value is assigned to a customer’s first purchase conversion. This is the recommended mode, because it allows you to maximize sales for all customers in one campaign, while attracting more new customers to your business.
  2. Bid for new customers only (“New customers only” mode): Here ads are targeted only to new customers of your company. This is done using previous purchases and lists of existing customers that you have uploaded to Google Ads. This option is only recommended if you have set your own budgets for acquisition or if the focus of your campaign is not on purchase conversions, but on lead generation, for example.
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