Someone once said that Americans deserved a tax system that looked as it if were designed on purpose. No doubt, the world is a complicated place when tax time looms. Rule changes, exemptions, complicated deductions — it’s no wonder that people start to sweat a little as April 15 approaches.
If there’s one thing taxpayers can cheer, however, it’s the fact that the web has really helped reduce the pain of researching tax information, completing tax documents and submitting tax returns. Tax season is increasingly a digital season.
Here at Bing Ads, we’ve seen firsthand the growing tendency to go online at tax time and have learned quite a bit about the habits of web-using taxpayers. We think tax time is a great time for those in tax-related service businesses to tailor ad campaigns that highlight the services they offer and attract new customers.
Clearly, people use the Internet heavily at tax time, whether that means researching the impact of tax laws, meeting with tax preparers virtually, or using online services to prepare their tax returns. Tax sites have experienced tremendous growth: according to comScore Media Metrix, the tax category was among the top 10 with the highest traffic growth in unique visitors last summer – and that is during an off seasonal period. In 2012, more than 145 million tax returns were submitted electronically, a figure expected to continue to rise. (Source: IRS.gov PDF)
Our own numbers show that about 2 million people used the Yahoo Bing Network for some 5 million tax-related searches. Google, of course, will have higher numbers based on market share.
For marketers in this space, the opportunities are there. I’ve already mentioned the increase in online tax filing. Note, as well, that the share of clicks in the tax category was growing at a rate of 12 percent-a-year as of 2012. And, we’re seeing growth in traffic to top tax and DIY tax sites, such as TurboTax, H&R Block, and TaxAct.
Also, mobile is growing rapidly in this space, as it is across the search world in general. Mobile filing apps for tax — such as IRS2Go, TurboTax SnapTax, TaxACT Central, and others — are gaining popularity.
But, as with the rest of the financial services vertical market, the tax industry can be a tough one to navigate from a search marketing standpoint. Query terms can be narrow, making it a competitive segment for winning ad bids. In fact, the average cost-per-click is the highest among all of the vertical markets we’ve researched, including automotive and travel. Plus, the changing regulatory environment in taxes can make it difficult to tailor a campaign.
To design an effective campaign, it helps to understand the search patterns people employ. Our research as shown that tax-related searches have two peaks during the season.
The first peak comes early in the year, shortly after people receive their W2s from employers. That’s when they usually begin to think seriously about completing their taxes and are apt to search for tax products and services.
If your goal is to reach these people, the time to advertise is now. Although searches are dominated by tax-related, brand-name software, advertisers can gain clicks with terms such as “accountants” or “tax preparers.”
Around mid-February, these very tax-service or product searches diminish. They’re replaced by terms such as “IRS” and “Refunds.” People are starting to anticipate their tax refunds — which averaged $2,803 last year — and thinking about how to spend them.
This entertaining infographic from the portfolio manager Jemstep, for instance, highlights some of the options. According to Jemstep, although about 43 percent of tax refund recipients plan to save the money, 12.3 percent plan to use it for a significant purchase such as a car or television set. Another 11.3 percent will use their refund for a vacation.
This means advertisers can choose among several strategies. Those in banking and investment, for instance, might want to suggest investing in a money market account or opening an online brokerage account. Retailers, auto dealers, and travel agencies, meanwhile, might want to tailor campaigns to attract people interested in spending their refund on durable goods or travel experiences.
Whatever the objective, be sure to take advantage of some of the tools offered by Bing Ads and Google that give your ads more impact.
For instance, both offer sitelink extensions, which are additional links in your ads that take people to specific pages on your website. This can be crucial to ensuring people click through to your site, as sitelink extensions have been shown to boost click-through-rates by 7-21 percent within the financial services category on our network.
While tax customers aren’t typically apt to be drop-ins, using call extensions in conjunction with location extensions allows for your phone numbers to be displayed — and the availability of click-to-call will depend on the device where the ad is being viewed. This can help potential customers find nearby tax help from local or national-local service providers. This should be combined with location targeting to ensure optimal customer experience and the most relevant leads.
Also, test ad copy early, before the first tax search peak, and then deploy those terms that perform the best. Remember to use dynamic insertions in your ads, which allow you to offer searchers more relevant text while using a single ad for multiple keywords. Additionally, you should employ a clear call to action, such as: “Contact us today to receive the full refund you’re due.”
As tax season progresses, update ad copy as consumer searches change from branded and research terms early in the season, to refund and tax extensions later. Also, bid for mainline positions to increase click volume and click-through-rates.
Consider using broad match for specific and relevant keywords to increase your prospects — they may be searching for related information, but don’t use the exact wording you anticipate. At Bing Ads, we found that in the Financial Services category, adopting broad match can deliver 46 percent more clicks and 65 percent more conversions than campaigns using only exact match, which would be inclusive of Tax.
As I noted earlier, mobile is a fast-growing part of the search world in taxes, so employ the right mobile strategy. Having a device strategy can help you reach prospects at the right time with the right contextual message.
Tax season can be trying. But by offering consumers value and service during this time of year, you can gain customers and help them navigate the complicated world of taxes.