Optimizing for success — How a ‘less-is-more’ approach delivered an 81% reduction in CPA.

Picture the scene: a brand has customer data, and a new product launch is imminent. Marketing campaigns are launched, everyone must know about product X!

Looking to build overall campaign reach it is tempting to re-target all known customers with messaging about the new product, measuring success in terms of likes, clicks and email opens. But what if we were to measure not in terms of those who do respond to a message but those who don’t?

It is unlikely that every customer will be interested in every single product that you offer, so by targeting them with every single campaign we risk that those customers will become less receptive to subsequent brand messaging that is of relevance to them.

When promoting events hosted on inphota.com we’ve benchmarked success outcomes rather than overall reach, focusing on messaging relevancy across all digital touchpoints. We combine on-site behavior and first-party survey data to create audience personas aligned to the event in question.

An example of the messaging relevancy challenge can be demonstrated through the registration behaviour of triathletes. Triathletes own a bicycle, so in theory should be a prime candidate for cycling event marketing campaigns, however we noticed that this audience was not responding to messaging for cycling events. Running a tactical market research campaign to this audience enabled us to understand that most triathletes avoid cycling races due to the perceived risk of accidents.

Through the monitoring of known customers who did not respond to messaging we were able to identify a major barrier to entry and exclude those who had no interest in cycling events from future campaigns. Ensuring that in the context of Electronic Digital Mail (EDM) campaigns we retained an engaged audience when promoting triathlon events.

Bringing this approach into ad targeting can help significantly reduce Cost Per Acquisition (CPA) of new customers, by training micro-audience sets and building lookalike audiences from a narrower criteria. This approach will reduce the total number of customers that you re-engage with each campaign but significantly increases messaging relevancy.

We employed this approach recently for our first campaign in Saudi Arabia, partnering with the Ministry of Sport to deliver the Home Run Campaign — the first virtual running event in the Kingdom. Having hosted several virtual runs in the UAE we noticed a distinct difference in the audience for virtual events vs. in-person events. Rather than target all known runners, we developed a segment of runners who were most likely to engage and built an audience for the purpose of targeting runners in KSA who displayed similar characteristics.

Despite not operating in the Kingdom previously and having no client data to work with, the data-driven optimization approach enabled us to support their appointed media agency in reducing the CPA from over $18 to less than $3 per registration. Having overcome this ‘cold start’ with already great results, we’d expect to decrease that CPA even further for subsequent events, as a virtuous circle of feedback is created which enables us to minimise wasted marketing spend.

This approach can be employed across categories, particularly as the COVID-19 pandemic accelerates the digital transformation of many businesses across the region. There has been a significant shift to eCommerce and for traditional retailers, moving their business online presents both challenges and opportunities.

In terms of digital media, the increase in customer data points affords traditional retailers the opportunity to take a more targeted approach to messaging, however, I frequently experience brands targeting me with every message, rather than tailoring based on my previous shopping behaviour.

It requires a change in approach and KPIs but perhaps it’s time to start thinking about who we aren’t targeting rather than who we are.