Acquiring new customers versus retaining existing ones is a common goal of advertisers. Google Ads offers account and bid settings to help. It starts with a feature called “New Customer Acquisition” in customer lifecycle optimization, located in the account-level goals section.
Advertisers can set an incremental conversion value for new customers. For example, if converting a repeat customer is worth $20, an incremental value could be $10, elevating new customers to $30.
Google provides a tool to calculate an incremental value based on average order value. To use, set a target return on ad spend for new customers. Say an advertiser wants a 100% customer acquisition ROAS — a 1:1 return. In the screen capture below, Google suggested a $46.27 value for new customers based on a given AOV and a $10 current value.
Google suggests a $46.27 value for new customers based on a given AOV, 100% ROAS, and a $10 current value.
The next step is to provide existing audience segments via Customer Match lists, either by specific category or overall. Google uses the lists (of at least 1,000 customers) to identify new prospects, much like how it uses first-party data to build lookalike audiences in Demand Gen campaigns.
Advertisers can deviate from Google’s suggested new-customer value and assign a higher amount. The option is often relevant for an audience segment of high-ticket buyers, provided there are 1,000 members. But a higher value is not critical in my experience, especially if the goal is to acquire any customer.
Having assigned an incremental value and uploaded a match list(s), the New Customer Acquisition feature is complete at the account level. Implement for each campaign by selecting the box labeled “Adjust your bidding to help acquire new customers.”
For each campaign, implement account-level acquisition settings by selecting the box labeled “Adjust your bidding to help acquire new customers.”
Google Ads will now bid higher within the target ROAS to acquire new customers, with lower bids for existing ones.
Yet advertisers can opt to bid only for new customers, such as for free trials or samples. Be careful, however, as this option will limit traffic. An alternative tactic is uploading an audience exclusion list of consumers who signed up for the free offer.
To activate New Customer Acquisition, advertisers must first set up value-based bidding. The system can’t bid higher for new customers without a base conversion value. Use a maximize conversion value bid strategy (with or without a target ROAS). Additionally, confirm the conversion classification is “purchase.”
Reporting
It’s worthwhile for reporting purposes to set a nominal new-customer conversion value (even $0.01) regardless of the bid strategy. Absent an incremental value, you can’t see the number of conversions from new vs. returning customers in the segment option view of “Conversions > New vs. returning customers.”
Even a nominal incremental value is worthwhile for distinguishing conversions between new and returning customers.
