Originally published in July 2022

Note: This is an actual scaleMatters analyst insight report delivered to our customer's executive leadership team in July 2022. To protect customer privacy, their company name has been hidden from all charts. At the time of this writing, our customer was a PE-backed $200M CRM software roll-up selling to nonprofit organizations.

🚨4X Increase in Google Ads Spend Negatively Correlated to Pipeline Conversion Rates & Deals [APR-JUN 2022]

Summary Findings

1. The 4X increase in Google Ads spend from Q1 to Q2 has had a negative correlation on Deal Volume. Deal volume is down 82% QoQ.
2. Web sessions and leads have increased substantially, while funnel conversion rates have dropped off. A decrease in lead quality (increase in junk leads) not only reflects wasted Google Ads spend, but also wasted sales resources chasing bad leads.

Analyst Recommendation

1. Immediately scale back spend from $2M/quarter to $500k/quarter.
2. Focus Google Ads spend on keywords most closely related to bottom of funnel / buyer intent keywords, and stop buying ads on keywords that have little to no buying intent.

Pipeline Quality Comparison: Q1 vs. Q2