If you’re like most marketers, you obsess about what your competitors do. The emergence of PPC (define) search, where position directly affects traffic volume and the popularity of position checking in SEO (define) have only strengthened the focus on competitive metrics and benchmarks. More established third-party data sources, such as comScore (which recently went public), Hitwise (recently purchased by Experian for $240 million), and Nielsen, are joined by relative newcomers Compete and Quantcast, as well as specialists such as AdGooroo. All these businesses exist to quench marketers’ thirst for competitive data.
Averages and relative data can be helpful, but they often get in the way of the strategic decision-making process marketers must engage in to win in ultra-competitive markets. I often get e-mail from readers and others in the industry that requests benchmark data, such as average CPC (define), average conversion rate, and average ROI (define). This obsession with the competition has both healthy and unhealthy effects on marketers and their campaigns’ focus.
The important thing for marketers to focus on is opportunity. Some competitive data may help determine the potential opportunity for efficiency or growth, but beating your own baseline numbers is a requirement to transform a campaign into a profit-driving machine.
Some of the greatest success stories in auction-based online marketing are driven by a balanced approach of watching and learning from the competition while focusing on continuous improvements in value identification and extraction from the media opportunities that exist in the PPC and media exchange markets.
Landing Page and Average Consumer Myths
When you test landing pages, the objective is to improve marketing metrics over the current baseline. Important metrics typically include conversion rate, order size, order profitability, lead quality, and predicted customer profit (lifetime value). Landing page tests are often highly fruitful because they allow you to move the needle on one or more key performance indicators. Yet many landing page tests fail to achieve dramatic improvements.
Solving for the best average landing page by lumping all visitors into the same category results in a user experience that’s OK for the average consumer. But there’s no average consumer! Each consumer is somewhat different from the average and responds to different messaging, has different price sensitivities, and is in a different stage of the buying cycle. A personalized approach will result in better overall campaign and landing page efficiencies than an attempt to solve for the average consumer.
There are many ways to look at an inbound clickstream and hypothesize whether a segmentation experiment might yield a positive result. Keywords are the segmentation mode we think of first. Chances are that’s how your campaign is organized, perhaps based on branded keywords, product keywords, and research keywords. But keywords are just the beginning.
Geography is a great way to segment consumers. For multichannel retailers, consumers’ geographic segments may be driven by the concentration of stores within a specific geography. Perhaps those close to a store convert by shopping offline and want to check stock in a store, while those who aren’t near a store shop purely online.
In offline marketing, one of commonest ways of segmenting consumers is based on the time of day. Dayparting in search isn’t necessarily just about buying the higher-value clicks; it could just as easily be about understanding which consumers visit your site at different times and how the user experience may need to be adjusted to reflect the different consumer preferences, needs, and desires.
At conferences and in discussions with prospective clients, I rarely hear about landing-page testing. I recall only once or twice that a marketer has included any kind of visitor segmentation in the testing model. Everyone uses averages, but when you manage a campaign exclusively based on averages, you doom the campaign to mediocrity (average performance).
The same holds true for your obsession with competitors’ CPC prices and conversion rates. Just as you control your conversion rate by being more or less focused on high-converting segments, your competition can adjust its level of aggressiveness when buying early- or late-stage clicks. A better strategy is to use your own campaign as the benchmark: a baseline that you strive to beat.
Put another way, you’ll outrun the competition better if you stop looking behind you.
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