Hear me out, because what I’m about to say defies some current digital marketing/Big Data wisdom…
Too many emerging brands are glued to analytics microscopes and are completely missing the bigger picture. Are analytics important to understanding your audience? Of course. But when you remain hyper-focused on your Cost-Per-Clicks and Cost-Per-Acquisition, it’s easy to get tunnel vision in a world of algorithms, a world which is less than a decade old, and one that doesn’t always accurately reflect the reality of your true audience / acquisition potential.
Therefore, when you optimize your digital campaigns towards lower “optimized” CPC’s and CPA’s, by the very nature of the tactic, you are reaching a smaller audience. This is akin to casting your line in a well-stocked but overfished pond, as opposed to an ocean full of potential.
After all, Nike didn’t worry about CPC when they were starting out. Neither did Coca Cola, Gucci, or just about any iconic brand you can think of. These brands focused on disruption and brand awareness through compelling, high-quality advertising campaigns and initiatives designed to introduce solutions to consumer pain-points and aspirations first and foremost. And yet, in 2018, there is a growing obsession – I like to call this the “CPC / CPA Epidemic” – and it’s spreading fast.
Performance marketing, in theory, effectively combines advertising and analytics to create highly targeted campaigns designed for a cost-effective audience. But the truth is that CPC is an up-front payment that is in no way guaranteed to result in conversions. In some industries where keywords and ad placements are particularly expensive, this could mean thousands of dollars in digital ad spend without so much as a single paying customer.
Your success is at the mercy of an algorithm that is trying to constantly decode the human psyche and present your ads to people whom it believes are the most “in market” and inclined to buy. These algorithms are also designed to generate the maximum return for the network’s shareholders.
Admittedly, if you stick with the tried-and-true metrics and only focus on the segments that are most likely to respond, it WILL generate revenue – Big Data is quite effective at this. But being blinded by these metrics and neglecting your upper funnel (awareness/branding) can really stunt your growth. Ever hear of “preaching to the choir?” That’s all you’ll end up doing if you don’t diversify your approach. You have to give people a reason to search for your brand – in order to scale you have to experiment.
An example of this obsession rests with a previous client of ours – a male grooming company that was looking to generate a larger return from their digital advertising efforts on Facebook. When they approached us they were generating a 1.2x return from their established interest audiences. They had nice CPA that they were happy with, but they weren’t selling at a volume that was satisfactory. We began a strategic awareness and branding campaign, in turn reaching more prospects than they had been within their own campaigns. However, throughout the course of the first two weeks, as a result of casting new lines in uncharted waters, they called us daily (aka, hourly) to express dissatisfaction with the CPA we were generating.
This company couldn’t come to terms with the fact that in order to grow, they had to expose their product to new prospects outside of their current audiences – at a cost. After multiple discussions, they simply refused to see the bigger picture. I’m happy to report we mutually agreed to part ways, and our philosophy currently generates great returns for other clients who aren’t afraid to take a leap of (calculated) faith.
Patience is key. It can take time and money to find new audiences, but discovering them through awareness campaigns is where your untapped glory resides. Not every segment will work out, but that’s okay. Let people know you exist and how awesome your product is. People can’t buy what they don’t know. Make them know you.
We get it. People are excited and eager to scale their business, as they should be. But success doesn’t always fall neatly into an attribution window. Brand recall can be a delayed reaction, but the seeds you plant in consumers’ minds today can blossom for you – maybe not tomorrow – but certainly down the line. After all, few people run out to buy a new Toyota – or switch their phone carrier from Verizon to T-Mobile – within a week or even a month of seeing their latest commercial, but when the time comes to open their wallets, that ad may have influence over their decision.
While it’s true that small-to-mid-sized businesses have almost no choice but to judge success based solely on what these analytics tell them, if you focus too much on numbers, you can lose track of what makes your product great in the first place. This is not to say that performance marketing campaigns are a waste of time, not at all, but your product is worth more than a click.
Metrics judge us in all kinds of different ways. I say it’s time we start judging them back.