The Infographic above illustrates the most expensive 20 Key Words in Google Advertising. Google is on pace this calendar year to exceed $40 billion in advertising revenue. While that is great news for Google and the Company’s shareholders, the real question is how well are Google’s advertisers doing in acquiring new customers online?
2010 marked the first year that online advertising exceeded print advertising. Law firms are also beginning to commit a substantial amount of their marketing budgets online. According to the 2012 Legal Marketing Survey conducted by LexisNexis and Avvo, 25% of the respondents to the survey spent 75% of their marketing budgets online.
So what kind of success are law firms having advertising online? A good conversion rate for leads (i.e. visitors to a company website via a click through from an online advertisement) ranges between 1% and 1.5%. So for every 100 visitors who click through to an advertisers website, only 1 to 1.5 become new customers.
Let’s assume for the moment that law firm conversion rates are comparable to those of other online businesses, the customer acquisition cost (“CAC”) for an online advertisement using the word “attorney” ($47.07 CPC) would range between $3,138 and $4,707. Unfortunately we believe that most law firms are experiencing conversion rates that are significantly lower than other businesses (i.e. between 0.5% and 0.75%).
More importantly, what does a law firm know about the other 99 visitors who or clicked through to their website but did not become a customer? Unless the visitor elected to complete the law firm’s “Contact Form”, the only information that the law firm would have would be the date and time of the visit; the web pages viewed on the site and possibly the IP address of the computer from which the website was accessed.
Is there a better alternative? We believe that online communities such as Legal Bistro where information about the consumer’s case has been obtained present a much better alternative to Google for online advertising. Stay tuned for further information about the benefits that Legal Bistro provides lawyers and law firms in subsequent articles.