If your retargeting network was wasting half of your budget, would you want to know? Please don't flame-mail the messenger, but I think ad networks may be wasting your money by effectively asking your customers to do something they already did. Ad networks may also be missing easy opportunities to convert your buyers into sellers, a dynamic that has propelled every successful social network and social shopping service to stratospheric success. I believe that good news is at hand: More-precise targeting pixels and some lessons from political campaigns can stop the budgetary leakage and help you employ the power of social shopping to your online conversions.
If you doubt the potential power of turning buyers into sellers, let me point out one word and one number: Groupon and 25 billion -- dollars, that is. If the company's success seems an outlier, perhaps a quick political comparison may help illustrate the power of this technique, which can also elect presidents and shift power in Congress.
For many lifetimes, the end goal of political efforts was to get a person to vote for your candidate. Good marketing and smart use of social media and technology changed that, and for good reason. A political party should not stop mobilizing people when they have voted; they should turn to low-cost methods like social media and email to make sure that the converted don't rest until they convert others. Modern media campaigners like OFA and CRAFT DC certainly get that.
It's an expensive proposition to convert a citizen into voter, just as it is to convert a web surfer into a buyer. The cost of identifying a voter -- learning who they are, where they live, and how likely they are to vote your way -- might average $28 per head; for harder to reach demographics like Hispanic men, the costs could go up to $45. (How's that for a cost per action? ) Getting that person to vote increases the costs. Thus, campaigns used to stop pursuing voters during "Get Out the Vote" efforts once the person had voted; campaigns had to steer their finite resources toward getting others out to vote. A new wave of campaign operatives, including Joe Trippi and Cyrus Krohn, recognized that people who voted could still be activists, and they used the relatively cheap methods of email and social media to make that happen.
Now, technically advanced organizations have multiplied the power of turning voters into vote-getters by socializing their customer relationship management (CRM) system. We tested a social CRM technique with the Republican National Committee (RNC) last year, which showed tremendous promise. As I am still under the RNC's non-disclosure agreement, I will describe a generic use case of social CRM in politics. When voter's social media handles are added into a voter database (with the permission of users and in a way that protects PII and HII), and a person uses their social media handle to report they have voted, political organizations experience a huge win.
First, they can steer their get-out-the-vote resources to people who have not yet voted; second, given the low-cost of modern contact methods, they can encourage that voter to become a volunteer turn-out operative. In commercial terminology, they can turn a buyer into a seller, hence the Groupon reference. These political organizations do not waste money asking people who voted to go and vote again; they spend a little money to encourage them to get others to the polls. Some brands, though, are asking people to go back and purchase the same things they literally just bought, and that seems a waste.
If my three months of purposefully keeping track of the obvious retargeting offers I see is any indication, about 50percent of these impressions are being wasted, often by brilliant marketers. Even if these are CPC placements, they cost something to traffic and track. Some examples follow. (To the brands that are mentioned, you will notice a compliment along with the constructive criticism: I bought from all of you.)
