I hear so many people telling me that they want the best CPC (cost per click) for their campaign to get new customers. Someone has told us all that in order for an advertising campaign to be successful, we need to buy cheap clicks. I can buy heaps of cheap clicks on obscure websites that will not get any new customers but what’s the point in that!
Yet when I ask people, how much it normally costs them to acquire a new customer, they often look at me as though I am a little crazy! Now how much it costs you to get a new customer is very different to how much you would like to pay to get a new customer! (that comes later!) But really, how much does it cost you for a team of sales people to cold call, or a TV campaign during the World Cup or a full page ad in the paper or a fleet of Vespas to drive around the street with your logo on it?
If you don’t know how much it costs you to get a new customer, you really need to find out! If you want to grow by 10, or 100, or 1000, or a million new customers, it’s time you looked at how you can grow your business and how much it will cost you.
The first step is identifying who your customers are! (Yes that does sound silly but take a moment to write down what your customers look like and see just how hard it is. We all want customers who have a million dollars that they can spend on our products but lets face it, there are only a few of them around!) So, think about who your customers are today and what they look like as people. Not just what their business looks like.
There is no point in running a campaign for 10 to 50 year olds if your customers are really 25 – 45 year old Mums with young children, or school leavers or empty nesters! So you need to single your customer out from the crowd!
The great thing about digital advertising is that you can show your ads to people based on location, age, gender, interests, profession and many more! You can also show different groups of people different ads so that you are putting the right creative in front of the right demographic. So play with the creative, the messages, have a strong call to action, and test different platforms. Understand what time of day people are online and buying. Is there really value in running TV ads at 4am when your target audience turns off the TV at 10pm?
Understanding who your customers are will often take the duration of a campaign. Expect something like a $10K media spend on digital across 4 weeks to be realistic. If you know who your customers are, you will save significant money in targeting them rather than people who are not going to be interested.
Once you run a campaign to people who you believe are your target customers, you can then analyse the results to understand who responded to your ads and who is most likely to buy. This is the sweet spot we are all looking for.
Now it’s time to get their attention!
Rather than focusing on a cost per click, focus on identifying your cost per acquiring a new customer. A campaign may start as a cost per click campaign. This is your research phase. Understand who you want to target as potential new customers. Then you may move to an optimised cost per click model which is optimising the campaign to people most likely to click on your ad and convert as a new customer. During this phase you may also re-target people who have already clicked on the ad but not purchased from your website. Once you really have a good handle on what your customers look like and how much a customer costs to acquire, you can then start looking at a cost per action model which specifically looks at paying for people who go to your website, or buy from your shop, or fill in a lead capture form on your website.
Remember, creative is critical! Try to think about your audience and what will get their attention. Your job is to cut through all the other noise in their life so that they see you. As you can imagine, showing them your logo, may not do the job! As I mentioned, vary the creative, vary the messages!
Trying to start at a cost per action is similar to watching 3 year olds negotiate over bath time. It usually ends up with the 3 year old losing and parents getting their way! (Which is only good if you are the 3 year old!)
So if a cost per click is $1.00 and you run a campaign to a broad audience who may or may not be your target customer but a new customer costs you $10 wouldn’t you rather target 10,000 people who are likely to buy your products than 10,000 people who are likely to just click on the ad?
This is where we come in! Your job is to grow your business, not be an advertising expert! We ask you all of these difficult questions from objective to customer profiling and then work with you on recommending the strategy and then run the campaign for you. We provide you with reporting so that you can see exactly what you are getting, how your customers are and what your true cost per acquisition looks like. THEN we work with you on ways to reduce that cost!
So why not email me a little about you and lets organise a time to chat about your business!
Trish van Tussenbroek
General Manager, Ybrant Digital Australia.