Onvia Finds Better Leads for Less

Onvia Software was facing a challenge in its search marketing: It was working too well.

As a provider of Web-based research and bid notification services for companies looking to bid on all types of government contracts, Seattle-based Onvia had started using pay-per-click search marketing two years ago to generate sales leads. The company quickly saw its initial harvest of a couple thousand clicks a month grow into more than a million—with a search marketing budget to match. The program, managed through search marketing firm Point It!, was undoubtedly bringing in a lot of leads for the Onvia sales team to pursue.

But last year, company-mandated marketing cuts forced Onvia to take a closer look at those online leads. “Our organization sets different priority tasks every six months or every quarter, and one of our tasks was to reduce the cost of lead acquisition,” says Jennifer Day, Onvia’s director of marketing communications. “Search engine marketing is our primary way of driving leads, so we knew we needed to test to understand whether we could lower the cost without giving up the quality.”

Working with Point It!, Onvia started by segmenting the leads its pay-per-click ads were already bringing in, sorting them into three categories according to the prospect’s readiness to buy. Onvia’s in-house sales department was tasked with following up every SEM lead that came in within 24 hours, in order to evaluate how close they were to a purchase.

And there were many near-purchase leads in the net. “Compared to many B-to-B providers, our service is not a high-consideration item,” says Day. The leads Onvia generates through search usually wind up being those with buying authority at their companies; and the relatively low price of Onvia’s services—about $2500 for an annual subscription—means the sales cycle can be as short as several days or as long as several months. Day estimates that Onvia’s average sales cycle takes about 30 days from first contact to sale.

But Onvia found it was also digging up leads that would require more handling to convert, such as a live consultation or online demo of services. And some of the leads generated were at the very beginning of the purchase funnel and could not be expected to convert without much more information, including some very basic instruction in how government bidding works.

Such newbies to government contracting were not really the sweet spot Onvia was aiming for, says Lisa Sanner, client manager at Point It! Rather, Onvia wanted to work with experienced bidders of all sizes who already had some contracts under their belts and who could benefit most from the efficiencies built into its service. These represented the best prospects for service renewals and long-term business relationships.

After segmenting the leads they were receiving, Onvia and Point It! cross-referenced the segments to the keywords that brought them in and found a positive correlation: certain keywords had a stronger draw among the ready-to-buy, while others seemed to attract mostly the early-stage researchers.

The pair then tested specific landing pages that targeted the groups most likely to be captured by a given keyword. Research-only leads were delivered to a microsite that offered basic information about government contracting. Mid-stage leads got landing pages tailored to help them over whatever their remaining hurdles might be: online demos of the services, sample guides, live consultations market assessments and the like.

In addition, Onvia segmented its leads into 10 industry verticals, doing A/B tests of landing pages for each segment using generic pages versus pages that featured the name of the vertical in the headline and throughout the copy. The aim was to examine the effect of optimized landing pages on the response and conversion rates within those key verticals. Other elements were tested too, including different offer wordings and the inclusion of professional awards Onvia has won.

“Onvia uses a promo code to bucket the leads from those landing pages,” Sanner says. “Then someone at Onvia works with the sales department to track actual conversions for each of those promo codes.”

As those conversion results came in, Onvia started going back to see which campaigns were underperforming in producing the hottest leads and began cutting those from its search marketing budget.

The results so far have been a 50% decrease in monthly clicks from the level reached last January and a two-thirds reduction in the cost of acquiring leads, thanks to the elimination of those less-qualified clicks. Day says the company went from paying around $20 a lead at the beginning of the year to about $7 now.

“We’re now refining the program even further,” Day says. “We’re still spending too much time talking with those people who are just looking into doing business with the government. Where before we thought we wanted to talk to them, now we’re not really interested in engaging with the audience who have already made the decision to do this kind of [contracting] work.” Onvia has optimized its “Government 101” microsite for organic search, to keep its name in front of those early researchers. But it’s still trying to keep them out of the reach of its sales force until they’re serious and ready to be contacted.

The verticals have also narrowed down to a key half-dozen industries, although several different landing pages may be deployed within those verticals depending on the ad keywords. For example, Sanner says, the construction group can see as many as 15 uniquely optimized landing pages, particularly during the cold-weather months when most entrepreneurs are in their planning and bid submission mode.

And Point It!’s management of Onvia’s SEM is still aimed at helping the company’s sales force make the most efficient use of its resources. “We periodically get ‘pause’ notices from Onvia to put a hold on their search marketing efforts for a week, to allow their sales force to catch up with the backlog of leads,” Sanner says. “But that’s a good problem to have.”