The 2012 tax season is upon us, and the number of people filing online tax returns is expected to grow. Paper filing, in contrast, is projected to decline as a percentage of total filings each year through 2018. (1)

Advertisers offering tax services, preparation, and software may benefit from these trends by optimizing their campaigns to capture people searching for these services.

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When the 2011 tax season kicked off in January, tax sites experienced a strong surge of activity, attracting 26.8 million visitors and representing a 345% increase over December 2010. Category leaders such as TurboTax, H&R Block, and TaxACT saw triple-digit gains during the month. (2)

Popular tax-related keywords continued to remain high in February, just after people received their W-2 statements at the end of January. While March is typically a slower month, traffic can spike again in April as the tax-filing deadline is April 17 this year. Procrastinators who file late make April a crucial month for advertisers. The chart below shows the year-over-year increase in tax-related searches. (3)

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Traffic trends are similar in adCenter, but the charts below show how competition heats up month over month, as the average cost per click (CPC) almost doubles from December to March. This means advertisers in 2011 were aggressively competing for best positions and increasing their bids to reach them. Click-through rates (CTR), however, were highest in January and February. (4)

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Five quick tax-season optimization tips:

  • Prepare for traffic spikes into April and apply sufficient budget to your campaigns.
  • Expand your keyword list with relevant terms. Consumers typically search for branded and research terms early in the season, while refund and tax extension are popular terms later. You can download a comprehensive keyword list here.*
  • Monitor the position of your ads and adjust your bidding strategy accordingly. In 2011, 60% of all clicks came from ads in positions 1 through 3. (5)

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  • Bid on all match types, ideally with the highest bid on exact match.
  • Test different ad copy and determine what works best. “Fast and free,” “easy to use,” and “professional help” are popular call-outs.

Do you have any tax season tips to share?  Feel free to leave a comment below.

Thanks for reading,

Peter Haubold, Vertical Specialist

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*NOTE: Always review keyword suggestions for applicability to your own campaigns prior to uploading.  Failure to do so could result in editorial disapprovals, a poor user/advertiser experience, or both.

(1) irs.gov

(2) comScore press release, 2/21/2011

(3) comScore Search Planner: Term Profile, Feb 2010 - Apr 2011

(4) adCenter internal data, vertical analysis, Dec 2010 - Apr 2011

(5) adCenter internal data, position analysis, Jan - Apr 2011