In today's fast-paced world, we're always looking for quick fixes or updates to make our lives better and lift our spirits. For some it could be the launch of a same-day delivery service from a much-loved store; for others, it could be better time management techniques to reclaim a few precious hours in the day.
From a marketer perspective, quick fixes usually relate in some form to ROI -- specifically, how can they maximize online advertising returns? This year, I've heard many marketers giving up on display advertising based on last year's formula. But I suggest you take a fresh look at display advertising. I've created a checklist of questions that will help you quickly identify ways to update your display advertising strategies:
- Do you know how your CPA has changed this year?
- Do you know the conversion and revenue contribution for all your digital channels?
- Are you using an ad exchange to optimize your media buy?
- Did you know that remarketing via an ad exchange can dramatically improve your customer yield and conversion rates?
If you answered "no" to any of these questions, take a look below for suggestions on how you can refine your display strategy.
Q1: Do you know how your CPA has changed this year?
Answered no: You don't know how your CPA has changed -- or you haven't been keeping track of it at all -- chances are that you are wasting chunks of cash running campaigns that aren't reaching the people you want to reach or producing ROI that you can brag about. There's no doubt that some of the messages will be getting through to the right people -- but how many are missing the mark? Is it possible that you're serving ads in the wrong place or at the wrong time? How much of your fought-for marketing budget can you afford to throw away?
Makeover suggestion: Require consistent, reliable trend metrics from your marketing operations. If they are not capable, get help. Keeping tabs on CPA is important because it's one of the basic indicators of how well a campaign is working. It's high up there on the list of performance-management KPIs for online marketers. There are online tools available that allow marketers to monitor the effectiveness of their CPA campaign in real-time, highlighting which elements are working well and where adjustments need to be made. Replicate the best-performing elements, intervene and adjust lesser performing areas, and be prepared to abandon elements that frankly aren't working and aren't worth fixing.
Q2: Do you know the conversion rates and revenue contribution for all your digital channels including display advertising?
Answered no: If you don't know the answer to this question, optimum media spend is impossible. And how can you know whether your display campaign is better or worse than the other channels? It can be a challenge keeping tabs on all the data. Here's a typical scenario: You've got three agencies, and they all deliver online ad performance metrics using a different calculation, in different formats, and on an irregular reporting cycle, making it impossible to see the combined performance picture. Sound familiar?
Makeover suggestion: Audit the metrics and set standards for each channel. Require that your agencies comply with the standards you set. Determine the value of each success event. Consider how your customers' behavior paths and multiple campaigns relate to your success event. Then apply weights to each success event so you can determine the attribution of your media costs by each channel.
For a cruise line, the success event with the highest value may be registering for information and a nearby travel agent. The lowest value and first step may be the initial visit to your website. Understanding the cost to generate each of these steps will enable you to calculate the total cost to generate a travel agent lead, as well as the most cost-efficient path. This knowledge becomes the basis for your media budget allocation and your channel optimization.
Q3: Are you using ad exchanges to optimize your media buys?
Answered no: The concept of ad exchanges isn't new. In general, an ad exchange is a real-time stock-market-type system in which ad networks and publishers that have ad inventory they need to sell can post it to the auction and other networks. Publishers that may be in need of that particular kind of inventory can buy it. There is a clear demand for such a marketplace. In a survey conducted by Forrester Research, 72 percent of online advertising professionals who were not already using an ad exchange indicated that they intend to do so soon. The same survey showed that 25 percent of online advertising inventory is never sold. And buyers are constantly looking for better and more targeted places for their ads.
Yahoo's Right Media and AdECN have been around for a while. Google recently launched a revamped version of the DoubleClick exchange that includes access to the Google Content Network via AdWords. This is a significant development because it means marketers will be able to control their search and display ad exchange from one platform.
Ad exchanges are gaining excellent traction and claiming their share of the $23 billion a year display advertising marketplace. At the same time, they're proving their value to advertisers.
Makeover suggestion: Don't miss out on a winning tactic. During the next three months, include a test buy on a large ad exchange. Set your maximum lower than your normal CPM and measure your results carefully. If you can measure conversions, test a slightly higher CPM and compare the conversion results.
For example, you are a financial services company responsible for acquiring 100,000 new customers per month and find that you are falling short this year, create a test campaign and media buy to beat your current CPA of $50. Be willing to loosen your ideal selection criterion. Set up a second test with a tight selection of your ideal target prospect, with a maximum budget but an unlimited CPM. Measure carefully the results of each test and apply the learning quickly -- before your competition.
Q4: Did you know that remarketing via an ad exchange can dramatically improve your customer yield and conversion rates?
Answered no: It's hard to re-find customers on the internet. And if you answered no to this question, it's likely that you spend a lot of time, effort, and money looking for needles in haystacks. Finding the right customer with the right message at the right time is the holy grail for marketers. The advantage of remarketing via an ad exchange is that it streamlines what can be a very long-winded process to audience targeting, and it greatly increases the chances that you'll actually find the customers you are looking for.
There are two obvious benefits to developing a remarketing strategy using an ad exchange. First, you can get way more value from your original ad because it gives you information to better target follow-on communications at the right time to the right people. Second, it's an automated way to have ongoing communications that are relevant and timely. For example, if you are marketing a health club, you wouldn't want to serve a 20 percent off new membership offer to existing members; you might want them to receive an ad highlighting discounts in the club's restaurant.
Makeover suggestion: Develop a remarketing strategy using an ad exchange to increase your reach and stretch your media investment.
I hope this checklist has given you some helpful advice for updating your display advertising strategies. But I'd like to hear about your makeover results. Send me your before-and-after makeover stories at [email protected]. Or leave them in the comments section on this article.
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