Does Paid Search Work for B2B Marketing?

Destroying money is a crime, but you’re doing just that when you don’t have a paid search strategy in place. Image via Shutterstock.

Paid search advertising doesn’t get a lot of love from B2B business owners. Having audited over 350 B2B paid search accounts, it’s pretty easy to see why: Paid search is a great way to lose a lot of money.

In particular, it can be difficult to succeed at paid search advertising in the sorts of niche markets most B2B companies target.

The smaller your market, the harder it is to identify profitable search terms and — even when you’ve found a good keyword — turning clicks into conversions and sales can be a real challenge.

For example, a few months ago I audited a B2B account that had spent months and $150,000 on paid search advertising without producing a single sale.

Is it any wonder the owner thought paid search was a waste of money?

This “Aha!” moment brought to you by Friends. Image via Giphy.

But here’s the thing, if you do it right, paid search is actually one of the best ways to grow a B2B business. For many of our B2B clients, paid search is their biggest source of leads and sales!

The question is, how do some companies succeed where so many others fail?

Succeeding at paid search

To successfully market a B2B company, it’s important to understand the differences between B2B marketing and B2C marketing.

Perhaps the biggest difference between B2B and B2C is the value of a sale.

For example, the average ecommerce transaction is worth $85 to $120. Even if you factor in repeat business, you might make $250 per customer.

Assuming a 50% profit margin, your Cost Per Acquisition (CPA) needs to be < $125 just to break even.

On the other hand, the lifetime value (LTV) for B2B companies is often between $20,000 and $200,000!

For B2B companies, even with a profit margin of just 10%, you can have a CPA of over $1,000 and still produce a great return on investment!

Take advantage of your LTV

So, how does your LTV affect your paid search campaigns? Well, the bigger your profit margin, the more room you have to figure things out.

This is important, because even the best-managed campaign is rarely optimized from the get-go. A well-designed campaign will save you a lot of money during the learning curve, but truly optimized performance takes time.

If you’ve only got a $100 profit margin to work with, it can be hard to make ends meet while you get your strategy right.

On the other hand, if you’ve got a $50,000 profit margin, one sale will more than cover the cost of getting your campaigns working correctly.

This gives B2B companies a huge advantage over B2C companies.

B2B vs. B2C
B2B, light-heavyweight champion of the world?

For example, last year we started running paid search campaigns for a B2B company in the insurance industry.

The client wanted leads for $150 or less, but we took advantage of their long-term profit margin ($1,000 to $10,000+) and ran a broad set of campaigns with a variety of keywords to identify which keywords produced the best results.

During our two-week blitz, our Cost Per Lead (CPL) was $250; however, the data we acquired during this period allowed us to identify several highly profitable keywords using the Keywords and Search Terms reports.

Using those keywords and a killer landing page strategy, we quickly cut their CPL in half. In fact, the campaigns were so effective that they produced an explosive growth phase for the company — resulting in millions in venture capitalist funding!

If you use it right, your LTV can be one of your biggest advertising assets.

Identify your audience

Often, who you think you’re targeting isn’t always who you’re actually targeting.

Unlike B2C companies — which are usually familiar enough with their audience that they know which keywords will produce results even before they start advertising — it can be difficult for B2B companies to find the right keywords for their niche.

After all, in a niche market, it can be hard to predict which keywords your audience uses when they are looking for your product or service.

In an effort to try and get in front of the right audience, many B2B companies bid on search terms that are superficially related to their offering but don’t actually indicate any relevant search intent.

Unfortunately, the wrong keywords drive the wrong traffic… and the wrong traffic never converts.

For example, remember that B2B company I mentioned earlier? The one that wasted $150,000 on paid search?

Well, $60,000 of their ad spend went towards search terms related to the keyword “translate” — which averages more than 150 million searches per month.

monthly searches in Adwords

That’s a lot of potential traffic, right? The problem is, most of the time, the more searches there are for a keyword, the less specific the search intent is.

And, if the search intent isn’t very specific, most of your traffic probably isn’t a good match for your landing page.

In this company’s case, none of the traffic was a match.

Not surprisingly, most searches that include keywords like “translate” don’t indicate a strong interest in a B2B company.

As a result, they got a lot of clicks, but their traffic wasn’t interested in their product, so no one ever converted.

Less is more

On the other hand, here’s what happens when you identify the specific keywords that your customers are using:

Adwords clicks vs. conversions graph

If you notice, click volume quickly falls off while the number of conversions stays about the same.

Eliminate irrelevant clicks and you eliminate their associated cost.

That frees up a lot of budget you can use to identify additional relevant terms and build your traffic volume back up — only this time, that traffic comes with more conversions. And, all of a sudden, paid search makes a lot more sense.

In this particular case, the client is now spending 48% more than when they started with us, but they are producing 9x more leads!

Cost per conversion graph
Now, instead of driving a ton of irrelevant traffic, paid search is their biggest source of leads and sales!

By the way, to see which keywords are working, all you have to do is pull a Keywords report.

Open AdWords, set the date range to anywhere from three to six months and click the Keywords tab.

Adwords campaign

Now, click the Filter drop-down menu and click “Create filter.” Create your filter.

Here, I’ve selected “Conv. rate > 2%”, but depending on how you measure success, you can choose to filter for the metrics that make the most sense for your business.

With your filter in hand, you can very quickly identify which keywords are producing value and which are budget black holes.

Speak to the pain point

In addition to targeting the wrong audience, many B2B businesses struggle to communicate their message effectively.

A lot of businesses assume that everyone cares about the specifics of their offering. After all, they put a lot of work into all those features.

The problem is, most people aren’t looking for a list of features — they are looking for solutions!

Your target audience doesn’t click on your ad because they want to know all about your product. They click because they think you can solve their problem.

To get people to convert, you need to identify the problem that triggered their search and speak directly to that pain point in your ad and landing page.

Unfortunately, many companies think that their landing page needs to address every possible question or scenario.

They’re wrong.

Highlighting all of the features of your product is your sales team’s job. The goal of a landing page is to show how your offer solves their problem.

If your ads are properly targeted, 90% of your traffic will come to your page with some version of the same pain point in mind. A landing page that speaks to that pain point will win their business!

So, does paid search work for B2B marketing?

Done right, paid search is one of the most effective ways to market your B2B business. It allows you to get in front of your audience at the exact moment when they are looking for your solution.

Done wrong, paid search is also a great way to lose a lot of money.

For B2B companies, paid search campaigns succeed or fail depending on how well they understand the differences between B2B and B2C advertising.

By utilizing what makes B2B marketing unique, you can leverage the strengths of B2B to create a killer marketing-sales cycle.

You’ve heard my two cents, now I want to hear yours. How have you seen paid search succeed or fail for B2B marketing?

About Jacob Baadsgaard
Jacob Baadsgaard is the Founder & CEO of Disruptive Advertising, a Utah-based PPC agency that uses PPC, CRO and ROI-focused analytics to grow businesses. When Jacob's not working, you'll find him hanging out with his beautiful wife and three daughters or on the river fly fishing. Connect with him on Twitter or LinkedIn.
» More blog posts by Jacob Baadsgaard


  1. Christiane

    Thank you for this detailed article, Jacob. This sums up pretty much the exact same experience I’ve had. I’ve had clients wasting money in their account just to get traffic to their site, that just wasn’t converting. Of course I might look bad to the client in the first place when suddenly the traffic is lower, but when they see that this can result in a better CPA it all pays off. So in my opinion paid search can be a real winner for B2B marketing.

    • Jacob Baadsgaard

      Thanks, Christiane! I totally agree. I’m glad to hear you’ve had good success helping your B2B clients with their paid search marketing. :)

      • Hammad

        was working on this a while ago but now thinking to get back as I got stuck after kw research. if the campaign is well designed you can get through but I lost :( em all !

  2. Bharat

    Quite interesting post, learned much from this post.
    Thanks for sharing your views.

  3. Ravi Shankar

    Nowadays paid search marketing very much effective than organic for B2B. This post is really useful for marketers, i loved it. Thanks for sharing.

  4. Gary Haffer

    I really like the way you presented the information.
    It is so true that targeting the wrong keywords can result in untargeted traffic. It is better to only target the long tail keywords that have a better chance of a sale.
    With regards to CRO, it is better to concentrate on the conversions than the clicks. Relevancy, Quality Score and landing pages really seal the deal and produce the sales you want at the lowest cost per conversion. Always keep that in mind.

  5. Bob Rustici

    Dead on 100%! Every point is great. The only thing I would add, which is a whole another blog posting is so many B2B efforts stop short on the call to action too. Let’s face it, white paper request is a good start, but just a contact us request is really lame. My advice in the call to action for B2B clients, let’s get creative and think of the selling process and is there something we can get from there?

    • Jacob Baadsgaard

      Thanks, Bob! It’s true that for many businesses, “Contact Us” isn’t the best call-to-action. You have to think about your whole buyer journey and many B2B visitors aren’t ready to reach out during the first visit.

  6. Jeannie Hill

    Great article. Thank you for your paragraph on how to check for keyword value by using filters.

    It takes a look first at what the page is meant to accomplish. I find better conversion rates when the landing pages is lightly themed to the ad copy and fit the stage the prospective buyer is at.

  7. Jacob Baadsgaard

    I’m happy to hear that the filters information was helpful. Try it out and let me know what you find!

  8. Henson

    Finally someone gets it! Great write-up.

  9. Arthur

    Hi Jacob, great article! If we connect the dots in the customer experience, we improve conversion rates.

  10. Corey Zeimen

    It is possible to get PPC to work in about any software B2B, its great for that.

    For everything else, your biggest problem is weeding out all the cheap people who can’t pay for what you sell and are seeking info more than anything.

    To fix this, I agree with your assessment in figuring out what the customers problem is as a person who has money and big money problems will search in a particular way and will clue you into how to capture them. Yes, it’s pretty expensive to setup unique landing pages to target each one of these pain points, but your wasting your money otherwise.

  11. Dreamstate Digital

    Great post! I’ll be sharing some of these insights with my clients. particularly the “right keywords for relevant traffic conversion”

  12. software development company

    Every point of this article is great and Great for B2B marketer. an awesome way to build a B2B business!

  13. Siddique Khan

    Great Post ! . in Case of Paid search if we are getting our achievement then this is better for us . Otherwise we are just wasting our time and money .
    I Think you have good experience in this field because you share such a amazing article with us

  14. Tom Wright

    Thanks for sharing. This has been a difficult topic for us lately. Trying to convince large B2B clients to switch from TV to PPC has been a struggle but I know it can be done. You show it can be done so that is reassuring. Thank you for the share.

  15. HQSoftware

    We have built a great PPC campaign and get on average 10 qualified leads per month. But it was only due to external help. Because even having completed internet marketing course, without real experience one has mere chance to build a successful campaign right away.

  16. Lets Develop

    What an awesome post, I really love to read such kind of informative articles that you have written. Well these techniques are very useful and amazing.
    Thank you for the post.

  17. Jonathan Bowen

    A bit late to this article but I agree fully and to the point where I wish I could see some data on how B2C companies make paid search work with their small little product sales. I mean for me paid search is on the verge of not just saving my company but potentially leading to massive growth if the trend continues. The ROI is only getting better after a 3 month optimization period (we had a small budget, you could optimize in 4 weeks easy with a bigger budget), then we doubled the budget this month and I’m frankly looking at doubling it again in 3 months from now. No other marketing we have ever done in 9 years worked much at all, including me managing a tiny AdWords budget since I knew nothing doing it myself. We just got this far on outbound, some referrals, etc. But then got stuck in a rut and unable to grow the last few years. Paid search is surprising effective and what makes it work is the lifetime value of a client is so high potentially that on a small budget just one client per month was enough to make it a good ROI, and two could be amazing.