How to use the new customer acquisition goal in Google Ads

Acquiring new customers is crucial for any business, but it’s challenging in today’s crowded digital landscape. Google Ads’ new customer acquisition (NCA) feature can help. This tool is designed to reach and convert prospects who have never engaged with your business.

However, using NCA effectively requires a strategic approach. Simply enabling it won’t automatically deliver new customers.

To maximize this feature, you need to set the right campaign parameters, monitor performance data closely and follow certain steps.

This guide will explore how to leverage NCA the right way to take your new customer acquisition to new heights.

How Google identifies new vs. existing customers

At the core of the new customer acquisition goal is Google’s ability to distinguish between users who have already converted for your business and completely new prospects. But how does it actually make this determination?

Google leverages three main methods to classify customers as new or existing.

You can use any one of these approaches or combine them for more comprehensive new customer tracking.

Google’s automatic detection 

This default method is enabled when you select the “new customer” acquisition goal. Google will analyze your account’s conversion data from the last 540 days to create an audience list of existing customers.

Anyone who has converted within that time window will be classified as an existing customer. Those not on that audience list will be designated as new customers.

This automated approach is the easiest to implement but also has some limitations since users can delete cookies or opt out of tracking.

Also, with more tracking blockers, privacy tools and a more privacy-aware audience, this method is unlikely to give proper results to work with.

Customer list uploads 

For a more robust way to define your existing customer base, you can upload your own first-party data via customer match lists. Google will designate any user not found on your uploaded list(s) as a new customer.

You can include up to five customer lists to cast a wider net around your existing audiences. Ensure your lists contain at least 1,000 entries each for optimal matching.

Conversion tracking tags

This method gives you the highest level of control. It uses a custom conversion tracking tag to explicitly label each conversion as “new customer,” “existing customer” or “unknown.”

You’ll need to work with your developer to insert this specialized tag on your conversion pages and pass through the appropriate parameters. It’s more technical but ensures accurate data is sent directly to Google.

Using a combination of these three approaches is generally recommended for the most reliable new vs. existing customer segmentation.

Beyond the new vs. existing classification

Even when optimizing for new customers using NCA, you’ll likely still see some conversions from existing customers in your reports. This can happen for a couple of main reasons:

Identification limitations 

There are some instances where Google may not be able to definitively identify an existing customer, such as:

• They are browsing on a new device or browser that hasn’t been previously recognized.
• They’ve cleared their cookies and website data, appearing as a new user.
• They convert through a different channel, like a call asset, where historical data is limited.

Multi-conversion scenarios

If a single ad click results in multiple conversions being recorded (such as both a lead and sale), Google will count all of those conversions toward your campaign goals, even if some are from existing customers.

While not ideal, some existing customer data “getting through” is expected with NCA campaigns. The key is understanding why it’s happening and finding the right balance for your business.

Avoid getting tripped up

To leverage NCA successfully, you’ll want to pay close attention to a few potential areas of confusion or misconfigurations:

Sharing customer list data 

• For Google to accurately match users against the audiences you’ve uploaded, those customer lists need to be shared with the same Google Ads account running your NCA campaigns. Double-check this is enabled.

Conversions classified as ‘unknown’ 

• Some conversions may come through labeled as “unknown” if Google cannot confidently categorize them as new or existing based on the data available. Minimizing these unknown instances will improve your audience segmentation.

Bid strategy alignment 

• Make sure your campaign’s bid strategy (like target CPA) is aligned with the specific new vs. existing customer signals you’ve provided to Google through audience uploads or conversion tags. Mismatched signals could disrupt optimization.

As you can see, there are a number of nuances and potential stumbling blocks to be aware of when using the new customer acquisition goal. 

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How to implement new customer acquisition tracking

Setting up new customer acquisition tracking requires implementing specific code on your website. There are two main methods: using the global site tag or Google Tag Manager.

Global site tag method

• Ensure you have a Purchase conversion action set up in Google Ads that meets the requirements.
• Install the Google tag conversion tracking code on your site.
• Add the “new_customer” parameter to your tag event snippet with values:
• true = New customer who hasn’t purchased in 540+ days (default window)
• false = Returning customer
• [Not specified] = Uncertain, like guest checkout

Example:

htmlCopy code<script type="text/javascript">
gtag('event', 'purchase', {
"send_to": "AW-CONVERSION_ID/CONVERSION_LABEL", 
...
"new_customer": true, /* calculate dynamically, populate with true/false */
...
});
</script>

Google Tag Manager method

• Select the new customer conversion tag in Tag Manager.
• Check Provide new customer data and choose the data source (data layer or custom fields).
• Add the required new_customer and customer_lifetime_value variables.
• Use the data layer or custom fields to pass the values to Tag Manager.

Data layer example

jsCopy codedataLayer.push({
  "event": 'purchase',
  "transaction_id": "1545c34e-691e-4726-aeda-b798df255e9c",
  "affiliation": "Google online store", 
  "value": 23.07,
  "currency": "USD",
  "new_customer": true,
});

Custom fields example

htmlCopy code<script type="text/javascript">
send_to = 'AW-CONVERSION_ID/CONVERSION_LABEL'; 
transaction_id = "1545c34e-691e-4726-aeda-b798df255e9c";
affiliation = "Google online store";
value = 23.07; 
currency = "USD";
new_customer = true;
</script>

Key parameters

• new_customer (true/false/unspecified)
• customer_lifetime_value (currency value if new customer)

Google can also auto-detect new vs. existing customers, but using the tag allows more accuracy. By passing customer_lifetime_value, you can assign a fraction of the average order value to new customers. 

Properly implementing this tagging is crucial for NCA to identify new customers and optimize bids/spending accordingly. It is recommended that you follow the documentation guides for your chosen method.

The most reliable way is to implement NCA with a direct command on new customer tracking rather than relying on Google to monitor things. If we take a Shopify store as an example, we can make use of the following code:

 function newCustomer() {
    return {% if customer.orders_count < 2 %}true{% else %}false{% endif %};
  }

Identity a new customer for your individual business goals

While Google provides the default 540-day window for classifying new vs. existing customers, that timeline may not perfectly align with your specific business needs. The definition of a “new” customer can vary significantly from industry to industry.

For example, in a high-velocity category like fashion retail, where customers make frequent purchases, you might consider anyone who hasn’t converted in 3-4 months as a new prospect worth resurfacing personalized messaging to. 

Conversely, a company selling high-consideration products or services with much longer buyer cycles may view anyone who hasn’t converted in 1-2 years or more as a fresh opportunity worth remarketing to.

This nuance is why tapping into advanced segmentation within your new customer acquisition campaigns is valuable. It allows you to customize how Google isolates and prioritizes these valuable new audiences based on your unique situation. 

Through audience segmentation, you can layer on additional recency, behavior, and demographic filters to refine exactly who does (and doesn’t) get bucketed into your “new customer” segments. This could include separating out:

• Brand new users who’ve never engaged with your business.
• Past purchasers who haven’t converted in over 2 years.
• Former customers who fell within your standard 540-day window.
• High-value audience segments like lapsed VIP customers.

With this refined segmentation in place, you can create tailored NCA campaigns, ads, landing pages, and audience triggers to deploy highly relevant messaging and experiences to each subset of new customers. 

For example, you may want to extend a “We Miss You” promotion to win back lapsed high-value buyers. Or showcase your newest product line to audiences who engaged with your brand a year ago but haven’t converted since.

Once you go beyond Google’s default new customer settings, the possibilities are virtually endless. But getting your segmentation strategy right is critical. Next, we’ll explore specific audience tactics and campaign setup considerations for effective NCA segmentation.

New customer acquisition goals: What to watch out for

One major concern with Google’s new customer acquisition reporting is the potential for inflated and misleading conversion values. Here’s how it works:

Let’s say you sell a product for $250, and you tell Google that a new customer is worth $75 more than an existing customer based on your lifetime value calculations.

However, what Google does next is add that $75 premium directly to the reported conversion value for new customers. So, if an actual $250 sale comes through, Google will record a conversion value of $325 for that new customer order.  

This artificial inflation of conversion value metrics like revenue and ROAS can be highly misleading.

While conversion value doesn’t necessarily equate to revenue, most advertisers understand and use it as a proxy metric. Having “made-up” values in your reports defeats the entire purpose of accurate data tracking.

If you’re unsure about using NCA’s inflated value, start by testing it in a limited campaign with very low assigned values before rolling it out fully.

You can also monitor the new “New Customers” conversion columns to gauge initial performance.

As Google continues to prioritize new customer acquisition, having transparent and trustworthy reporting around it will be crucial. Misleading conversion values only muddy the waters around the impacts of your acquisition efforts.

New customer acquisition best practices

When first experimenting with NCA campaigns, it’s wise to start slowly by assigning a very low “new customer” value like $0.01.

This allows you to monitor performance and isolate new customer data without artificially inflating conversion values and skewing critical metrics like revenue and ROAS. 

Additionally, create an “active customer” audience segment as a negative exclusion list.

Clearly define what constitutes a new customer for your business – is it anyone who hasn’t purchased in the last 3 months, 6 months, 1 year or more? That delineation will ensure NCA targets the right new prospects.

As you test, add the “New Customers” and “New Customer Lifetime Value” columns to your reports. This visibility lets you assess the actual new customer conversions driven and the total assigned premium value.

With this data, you can calculate the real-world impact on overall ROAS and revenue before ramping up your new customer valuation and bid strategies.

Precisely scoping your new customer definitions, slowly testing with minimal inflation, and closely monitoring segmented data are critical best practices. They allow you to accurately measure the impacts of your NCA efforts from the start.