The really big money often comes from less cut-and-dried processes
The most important levers driving return on marketing investment are not always direct-response type goals. Sometimes the product or service is too new, too complex or too unknown for a pure direct-response approach to work well; you may need to educate and engage prospects before they are ready to make a purchase. Perhaps the purchase decision process for your product is too long term for a direct-response approach, or perhaps you have already squeezed the most out of your current site and creative, and you need to make big, fundamental changes to take your business to the next level.
User experience improvement, brand-building, customer engagement and positioning versus the competition are all very worthwhile investments, and optimization need not be excluded from such efforts. We just need to translate these goals so that they make sense as optimization targets, in terms of measures that are easily captured online.
Let's look at an example:
Say we have a new product to promote on our website. The product is Whezone, a newly approved drug to treat respiratory system inflammation. A significant amount of education and brand building will be required to make Whezone a drug that patients ask for, but we know from our experience that informed patients can influence their physicians' prescription choices -- each 1 percent increase in top two box score on brand recall among patients translates to $10 million in additional sales over the time the drug is still under patent. A similar increase among physicians will produce 10 times that impact -- about $100 million.
Now, our optimization goal will be expressed not in conversions or NPV, but in terms of engagement. If we are maximizing engagement, we need to optimize towards a goal that accounts for the following factors, and we could combine them using a point value scheme for each type of activity to be included:
- Visit frequency (visits per month) -- five points per visit
- Visit depth (distinct pages viewed) -- three points per page viewed beyond starting page for the visit
- Visit duration (minutes per visit) -- five points for every minute beyond the first minute
- Commitment actions: Registration -- 30 points; blog contribution -- 20 points; posting to discussion -- 20 points; requesting free sample coupons -- 50 points
Let's say we have five different message/creative combinations that we have built for our different types of visitors:
We'd again put them in equal, random rotation for a while to collect data about who responds to which offer. If the results looked something like this:
Then in the optimized case the results would look something like this:
The lift in our engagement score: (17,400,000 -- 10,680,000)/10,680,000 = 62.9 percent.
What about the money?
Being precise about it would require us to link our lift to an increase in brand recall -- which would best be done via an online survey of our visitors run before and after optimization was initiated. Again, if each point in brand recall is worth $10 million for patients, $100 million for physicians, and we are actually having an impact on those scores, then the money side of this equation will probably look very good indeed.
Conclusion
Optimization is ultimately successful only if it drives a positive ROI. This should not blind us to the fact that the most important levers driving return on investment in the longer term will continue to be user experience, branding, engagement and positioning vs. competitors. Optimization can be applied to these if we can translate these goals into optimization-friendly terms.
Bill Seely is director of client interaction optimization at [x+1].