Over the past few years, I’ve had the opportunity to have a first-hand look at several marketing plans, budgets and strategies — quite a few, of which, that have been weak and sub-optimal.
I’ve noticed an alarming trend within small businesses and startups across all industries: After experiencing a small degree of success from their current efforts, they get complacent. Teams that were once innovative and curious go on autopilot — pre-allocating funds to the same channels they’ve always used to connect with their audience.
In the beginning many startups experiment with a myriad of marketing channels, ad placements and creative direction to figure out what works for their target market. But, after a few short years, they stop exploring. What gives?
Feeling nervous? Don’t be.
Adopting a flexible marketing budget so you can experiment more freely with your marketing strategy doesn’t necessarily mean that you’re going to experience high volatility in the allocation of ad dollars between channels and placements . In fact, there is a lot that you can gain by embracing a marketing strategy that is off-beat and experimental.
As an example — several years back, I managed all online marketing efforts for an e-commerce startup. Each day, I would analyze each campaign and then reallocate funds based upon the return and results. In fact, there was a clear association between the flexible marketing plan we created and the overall profit increase.
When Facebook added ‘Sponsored Posts’ to the main news feed, we ran a quick test and quickly learned that the placement of the ad had an incredible ROI that we could gain from for an extended period of time — without any interference from our competition, which would have had an impact on pricing, and thus performance.
In a market surrounded by slow, corporate behemoths with marketing plans and budgets controlled by even slower media agencies with their marketing budgets often controlled by even slower media agencies, we were at an incredible advantage.
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We experienced the same incredible advantage when Facebook launched Mobile App Install Ads. Because of the flexibility in our marketing budget, we were able to allocate almost everything to this new placement for several weeks.
I want to note that while each of these examples sheds some light on how we tweaked our initial marketing plan and adjusted our marketing budget — there is so much more to creating a creative marketing plan than being quick on the draw and trying new ad placements.
So, you’re feeling super uncreative and your marketing budget is set in stone or is totally non existent. Don’t fret. There are a few things you can do.
Of the seven default attribution models offered in Google Analytics, the majority of marketers base their budgets off of the Last Click Model, which attributes the entire conversion value to the most recent ad that was clicked prior to the customer converting.
A Word Of Warning: While I’d love to take you step-by-step on how to perfectly attribute conversions across several marketing channels in Google Analytics — or with any other tool — there currently isn’t a way to do this. So, you’ll have to take a shot in the dark to figure out just where-the-heck a few conversions come from.
While this might make your job a little more complicated, it is well worth the few extra minutes to ensure you are evaluating your marketing efforts correctly.
Not quite convinced?
Many startups I’ve worked with have outsourced their marketing efforts at one time or another to a media or advertising agency. While the good agencies are worth their weight in gold — and they charge about that much — most of the time, these outsourced solutions are slow to adapt when it comes to new ad formats, ad placements and marketing solutions. On top of that, they’re typically cost-inefficient.
Just a few weeks ago, I met with a creative agency who had spent several six-hour days on an ad for a client. While the finished ad looked great — it was image where everything but one element was “static” — it wasn’t presented in an optimal format for format for any social media platforms (Facebook, Instagram, Google+, etc.) So, we ended up having to put additional resources towards reformatting the “finished product”.
Your marketing plan and budget should never be built upon vanity metrics. In fact, Suboptimal performance marketing happens when vanity metrics, like Click Through Rates (CTR), Conversion Rates (CR) and Cost Per Thousand (CPM) are seen as any kind of qualitative metrics. Instead, focus on the Cost Per Action (CPA) and Return On Investment (ROI).
Side Note: A CMO at a (huge) B2C company ordered his team to do everything they could to acquire more followers on Facebook than their competitor (500k). This is a perfect example of a vanity metric. Does the volume followers increase your profit? While it might move the meter a little.. You’ll find that what matters is the quality of your efforts, which is achieved through meeting your profit goal — not the number of followers.
Your marketing budget should never be pre-allocated to various channels. Instead, set a budget and a profit goal. Then, skip the metrics in-between — they’re only going to frustrate you. In addition, reevaluate all marketing channels to ensure you aren’t spending too much or too little in one area. That way, you can make any budget changes if a certain return on investment (ROI) goal is met or missed.
Lastly, be creative and adapt quickly to new ad placements and ad formats. You never know when you’re gonna hit the motherlode.