Solved: High Cost, Low Quality Leads from Google Search Ads

Hi there,

Thanks for reaching out and explaining what you're struggling with. It sounds like a classic B2B SaaS Google Ads issue, and honestly, it's super common, especially with HR software which is a big purchase decision for businesses. Happy to give you some initial thoughts and guidance based on what you've described.

You're getting leads, which is something, but they're largely unqualified and costing you a pretty penny at $120 a pop. The conversion rate from lead to sales-qualified opportunity being less than 3% tells us there's definitely a significant problem somewhere in the process. Based on my experience with B2B software campaigns, this usually comes down to one or a mix of a few things:

We'll need to look at traffic quality and your website...

First off, the platform choice itself – Google Search Ads for B2B HR software. Generally speaking, I'd say this is the right ballpark. Businesses needing HR software are often actively searching for solutions or alternatives to their current system. Unlike consumer products or services where you might need to create demand, B2B software often benefits from capturing existing demand through search intent. So you're likely in the right place, but the *type* of searches you're appearing for might be off.

This points to keyword targeting. If you're bidding on broad terms like just "HR software", you're going to attract a huge range of people. Some might be students researching, some might be consultants, some might be small businesses who aren't a fit, or even people looking for home-use software. To get higher quality leads, you need to target keywords with really clear commercial intent. Think "best HR software for small business", "cloud HR system pricing", "migrate from to new HR software", "HR payroll software comparison". These types of searches indicate someone is much further down the buying funnel and is actively evaluating options. You need to be really specific and probably exclude lots of generic terms that don't scream "I'm a decision maker at a company in need of HR software".

However, in my experience, while keyword targeting is important, the biggest culprit for low-quality leads and high costs in B2B SaaS is often what happens *after* the click. You could be getting perfectly relevant traffic from people searching for exactly what you offer, but if your landing page or the first step you ask them to take isn't right, they'll bounce or give you junk info just to see what's next. It's like paying for premium customers to walk into your store, but the door is really hard to open, the layout is confusing, and you immediately try to sell them the most expensive thing without letting them browse.

It's probably the offer and landing page, tbh...

Think about that $120 CPL. That's the cost to get someone to become a "lead" whatever that currently means for you (filling a form, requesting a demo?). If only 3% of these are qualified, your actual cost per *qualified* lead is sky high – something like $4000 ($120 / 0.03). This is where improving your conversion rate *on the site* becomes absolutely critical. Any small increase in the percentage of qualified visitors who convert into a qualified lead will drastically lower your cost per qualified lead.

The main thing I see trip up B2B SaaS companies is their offer and landing page experience. You mentioned you get leads, but they aren't the right size or role. This *could* be targeting, but it's also possible the targeting is mostly okay, but only the least qualified people are bothering to convert because the bar is too high for the valuable ones.

Consider this: changing HR software is a big, complex decision for a business. It involves multiple departments, security concerns, integration with other systems, training, disruption... it's not something they do on a whim. So, asking someone searching on Google, who might just be starting their research, to immediately book a full demo or talk to sales can be too much friction. I looked at a B2B accounting system website recently that was having similar ad problems – they weren't offering a free trial, only a demo. Their competition was offering months of trials. It makes a huge difference. People want to kick the tyres themselves, explore the features, see the interface, maybe play around with it using their own data if possible, before committing to a sales conversation. A demo is okay later, but as a first step for inbound traffic? Often too much.

A completely free trial, even if it's feature-limited or time-limited, is usually the lowest-friction way to get potential users "in the door". This allows you to capture more of that relevant search traffic as sign-ups. Then, you can use onboarding flows and potentially sales outreach to nurture these trial users and identify the ones who are a good fit (right company size, actually using the HR features, etc.). This shifts the qualification process slightly later, but significantly increases the volume of potentially good leads you get for your ad spend.

Your landing page needs to be laser-focused on getting that initial conversion (the trial sign-up or demo request, but ideally a trial). It needs clear, persuasive copy that speaks directly to the pain points of HR departments in companies of your target size. Highlight the key benefits, show quick explainer videos or screenshots, use social proof like testimonials or logos of similar companies you work with (if possible and allowed). It needs to build trust and make the value proposition obvious within seconds. We often use a copywriter specifically experienced in SaaS landing pages because it's such a specialised skill and can make a huge difference.

Improving the Funnel Conversion Rate...

Let's say you're getting relevant clicks for $5 each. If your landing page converts visitors to "leads" (like demo requests) at 1%, your CPL is $500 ($5 / 0.01). If you manage to improve that conversion rate to 5% by having a compelling offer like a free trial and a much better landing page, your CPL drops to $100 ($5 / 0.05). Even better, if the *quality* of leads from that free trial offer is higher because you're attracting people genuinely interested in trying the software, your cost per *qualified* lead drops dramatically.

For example, we had one B2B SaaS client who was getting registrations for their software at $2.38 each using Meta Ads, which is incredibly low for B2B. While that wasn't Google Search and Meta Ads CPLs can be lower, it shows what's possible when you get the offer and the flow right for software sign-ups.

So, I'd say before giving up on Google Ads, you need to seriously overhaul your landing page and reconsider your initial offer (free trial vs. demo). You might be driving qualified traffic there already, but your current setup isn't capturing or qualifying them efficiently. This is often why ad spend plateaus or seems ineffective for SaaS – it's not necessarily the top-of-funnel ad platform, but the conversion rate lower down that's the bottleneck.

Here's a quick overview of recommended actions:

Implementing these changes, particularly around the offer and landing page, will likely require significant work on your website and potentially re-thinking part of your sales/onboarding process for trial users. It's not a quick fix like changing a few keywords, but it's essential for improving lead quality and eventually lowering that high cost per qualified lead.

Giving it time and ongoing effort...

You mentioned trying for six months. That's a decent start, but optimising B2B SaaS campaigns, especially from scratch internally, can take longer. It requires consistent split testing – trying different landing page versions, different ad copy, refining targeting based on which keywords and audiences yield the *best* trial users, not just the cheapest leads. My thoughts are you shouldn't give up on Google Ads yet, it absolutely can work for B2B SaaS, but it needs the right foundational pieces in place, mainly the offer and website conversion flow.

As for whether you need external help – trying to tweak complex campaigns and redesign core parts of your funnel (landing page, offer) while also running a startup is tough. If you don't have dedicated marketing and conversion rate optimisation expertise in-house, it's really easy to spend a lot of time and money without seeing the necessary improvements. An expert who has specifically scaled B2B SaaS campaigns and knows how to diagnose these sorts of high-CPL/low-quality issues, particularly focusing on conversion rate optimization post-click, could likely accelerate the process and get you to profitable scaling much faster than figuring it all out through trial and error yourselves. We've run quite a few campaigns for B2B SaaS, and while some see ROI quickly, others take time to get the offer and targeting truly dialled in, and having that specific experience makes a huge difference.

Sorting out your landing page and offer first will make any future ad spend on Google (or other platforms like LinkedIn or Meta) much more effective.

If you'd like to chat through your specific setup in more detail and get a clearer picture of where the biggest opportunities for improvement lie, feel free to book in a free consultation. We can take a look at your site and current campaigns and give you some more tailored feedback.

Regards,
Team @ Lukas Holschuh