In this day and age, there’s no limit to the amount of money you can sink into your online campaigns. There’s also no shortage of platforms where you can spend your advertising budget. PPC platforms like Google Adwords and Bing Ads can charge up to $40 for just a single click in the most competitive niches, and alternative platforms like Facebook Ads continue to rise in price. Media buying has never been easier, with major media companies like AOL offering self-serve platforms where the minimum buy-in is a mere $100.
On the other hand, you can buy less targeted visitors from StumbleUpon for as little as $.10, or setup your own affiliate program to incentivize others to do your advertising. The opportunities are endless. But with so many varied options available, how do you figure out where to spend your advertising dollars and ensure that you’re maximizing your ROI?
Testing & Tracking Your Campaigns
No matter what the platform, the key to success in online advertising is testing, testing and more testing. Whether you’re trying new ad platforms, experimenting with different keywords, or split testing an element of your ad copy or landing page – it’s essential that you systematically track and test every aspect of your online campaign. With so many competitors competing for the attention of the online user, knowing your metrics and optimizing every element of your sales funnel is critical to success.
Optimizing Your Sales Funnel
For a successful campaign, optimizing the front-end elements of your campaign is essential to success. From the ad copy, to the landing page layout, headline, sales copy, and call to action – even to the load speed of your website – every little detail should be tested to ensure it maximizes the chances of making a sale. Even something as tiny as changing the color of a “buy now” button can make a significant difference over time. Make sure you can precisely measure the effects of every little change, or you’re simply flushing money down the toilet.
Optimizing Your Backend Marketing Funnel
But a successful paid advertising campaign goes beyond making the initial sale. To succeed in the competitive online advertising landscape, you need to look beyond initial conversion rates. You should also be focused on maximizing the lifetime value of your customer.
Have you ever wondered how a competitor consistently outpaces your adspend? Have you run the numbers over and over again and figured that your competitor must be running below cost, and yet they continue to spend those dollars and bid up the cost of your ads?
If your competitor always seems capable of outbidding for coveted PPC keywords, then a few things could be happening.
- They have a better conversion rate
- They have lower costs than you do
- They’re recapturing lost customers and extracting more lifetime value from each customer.
If you’ve spent extensive resources testing and optimizing your campaign and you have a good understanding of your competitor’s cost structure, then chances are that your competitor is squeezing out more value from their customers on the backend. A properly optimized backend marketing funnel can be the difference between a losing campaign and a positive ROI. It can allow you to outbid competitors, spend more on your traffic, and still make more money overall.
Here are some ideas you can explore if you’re looking to get more value from your paid traffic by optimizing your marketing on the backend:
Collect Emails & Setup Autoresponders
Sometimes you can’t get the customer to complete a sale right away. But if you collect an email address early in your sales funnel, you can use this information to recapture customers and make further sales in the future. Use the emails you collect to build a relationship with your potential customer. Setup an auto-responder series that sends out useful information and gently pushes the customer towards a sale. Email can also be used with existing customers to inform them of sales and new product launches, generating further revenue down the road.
Collect Phone Numbers
Depending on your niche, phone numbers can often be even more valuable than email addresses. A simple call asking them why they didn’t complete their purchase will not only give you valuable data you can use to further optimize your landing pages and sales copy, it’ll give you the opportunity to address the concerns that killed the sale in the first place. Put your best foot forward, and perhaps even offer these customers a discount or other incentive to complete their purchase.
Unlike traditional PPC ads, retargeting works by showing your ad on the network only after the user has been to your website. The user will continue to see your company’s ads as they navigate the web.
Retargeting has a notoriously high success rate because you’re advertising to potential customers who have already been qualified; these customers have already demonstrated an interest in your product/service. For whatever reason, they may not have been ready to purchase at the time, but continued exposure to your message and brand can be used to recapture lost customers and squeeze the most value possible out of your advertising dollars.
Build a Long-Term Relationship
Whether you do it through email, social media, the phone, always look to deliver exceptional customer service and value to the customer. Where appropriate, look to build a community around your service/product. By consciously looking to build a long-term relationship with your customers, each new customer you acquire will be worth more to your company as they keep coming back for more.
Even though maximizing the lifetime value of each customer and recapturing lost customers is just as important as optimizing your conversion rate or reducing costs, it’s an aspect of online advertising that often gets overlooked. Use some of the suggestions above to maximize the lifetime value of your customer, and make sure you implement systems to track the value of each customer – from the moment they click an ad, to the items they purchase 2 years down the road.
Knowing the lifetime value of your customer will not only allow you to better measure your ROI, it will allow you to bid more aggressively than your competitors for those coveted keywords and ultimately – it will increase your bottom line.
This is a guest post by Andras, an occasional guest-blogger and a full-time online marketing consultant. He currently works for Jangomail, a mass email service provider.