𝐃𝐢𝐝 𝐲𝐨𝐮 𝐤𝐧𝐨𝐰? 𝟔𝟒% 𝐨𝐟 𝐦𝐚𝐫𝐤𝐞𝐭𝐢𝐧𝐠 𝐥𝐞𝐚𝐝𝐞𝐫𝐬 𝐫𝐞𝐩𝐨𝐫𝐭 𝐭𝐡𝐚𝐭 𝐝𝐚𝐭𝐚-𝐝𝐫𝐢𝐯𝐞𝐧 𝐬𝐭𝐫𝐚𝐭𝐞𝐠𝐢𝐞𝐬 𝐚𝐫𝐞 𝐯𝐢𝐭𝐚𝐥 𝐢𝐧 𝐭𝐨𝐝𝐚𝐲’𝐬 𝐝𝐢𝐠𝐢𝐭𝐚𝐥 𝐞𝐜𝐨𝐧𝐨𝐦𝐲!
Digital marketing coupled with the use of data and marketing analytics has been on the rise, and this can be attributed to the advent of technology and an increased number of brands undergoing digital transformation. More brands and marketing leaders are realising the importance of data-driven marketing, and are backing their digital marketing strategies with data and past results to ensure that their marketing dollars are spent in the most efficient manner.
As a result, performance marketing has been on the rise in recent years and the industry is expected to expand further in the near future. If you have yet to read our previous blog on performance marketing, check it out here for a comprehensive introductory guide on how your brand can get started!
📌 Performance Marketing Challenges in 2022
As we near the end of 2022, it is important to consider the challenges that performance marketers may face in the months and years to come. Gaining a better understanding on the road ahead will ensure that you will be best-equipped to develop a performance marketing strategy that takes into account any potential challenges and obstacles.
1️⃣ Death of the Third-Party Cookie
Google's decision to phase out third-party cookies is in part influenced by worries raised by a variety of privacy campaigns and individual consumers. With 81% of online users believing that the risks associated with data-gathering outweighed the advantages, it can be seen that consumers are becoming increasingly concerned about how data is gathered and handled.
With the death of the third-party cookie, advertising will become less accurate, in turn leading to an increased customer acquisition cost (CAC). Reactivating previous customers is a smart move in this case. As mentioned in our previous blog on data-driven brand loyalty, the cost of retaining existing customers is far less than acquiring new customers by 5 times. The most cost-effective way to address the death of third-party cookies will be to increase your customers' lifetime value and retention rate by segmenting and bucketing users based on their actions on the website, loyalty status, and spending habits to curate unique offers and ad messaging to engage these users and push towards repeat purchases.
2️⃣ The Need for Data Expertise
Large volumes of data are available to businesses nowadays across each platform and most marketers look at each channel in silo to make crucial business decisions. However the best practice is to consolidate all of these data sources and analyse them thoroughly prior to making business decisions is vital. Here are some reasons why you should holistically view your data before making decisions:
Analyse channel performance by taking into consideration the attribution path/effect
Optimise campaigns based on attribution and not last click conversions.
Analysing trends to uncover seasonality and performance gaps
Uncover CRO (Conversion Rate Optimization) opportunities and test ad messaging/ creatives/ landing pages
While it takes a lot of time to make sense of the data accumulated by transforming it into insights, and drawing actionable conclusions from it, it is important that you acquire the right talent/expertise to help uncover the hiddens gems within those platforms. As the costs of hiring Data Analysts are very high and sometimes unaffordable by SMEs, the cost effective solution would be to work with an agency that provides these services at the fraction of the cost of hiring these resources.
3️⃣ Identifying the True ROI on Your Ad Spend
Finding the genuine ROI on your marketing activity is essential in a cookieless environment, as making informed budgeting decisions depends on effectively calculating ROI for each of your marketing platforms. Therefore, your media purchase will certainly become less effective if you are unable to link incoming revenue to marketing touchpoints. This is further supported by a recent BCG poll, which found that marketers anticipate a 22% decline in marketing ROI as a result of the impending depreciation of third-party cookies.
📌 Performance Marketing Industry Best Practices
While marketers in the performance marketing industry may face challenges such as the ones highlighted above, you can ensure that your brand’s performance marketing is carried out in the most optimised manner by considering the best practices outlined below:
1️⃣ Carry out A/B testing
A/B testing is crucial because it allows you to compare strategies and pieces of content to discover which one works the best for your brand and target audience. Without A/B testing, you risk wasting precious resources on marketing activities that may not bring strong results for your business.
2️⃣ Constantly tracking and monitoring results
Keeping track of any losses and profits will help you determine what works well for your business. For example, attribution, mobile vs. desktop, bounce rates, all provide information about the effectiveness of your advertising activities, and provide you with insights on how you can fine-tune your strategies to perform better in the future.
3️⃣ Create good landing pages
When it comes to turning leads into customers, landing pages make a huge difference. Never undervalue effective landing page design, which helps users move from expressing a passing interest in your business to actually taking it a step further.
📌 Optimise Your Performance Marketing Today!
VKT is a data-driven strategic consulting & digital marketing agency. We are obsessed about performance and helping businesses turn ineffective digital marketing campaigns into visible, measurable results, in the form of lead generation and revenue growth. In the past month, we have achieved 120% revenue growth within a month for one of our clients, leveraging on customer insights and data analytics to formulate and optimise our performance marketing strategy.
With our experienced MRA & EDG Certified Consultant, VKT boasts a proven track record in achieving a high EDG application success rate that grants your business up to 70% funding for SMEs and 50% for non-SMEs. So contact us now for a strategy session with our Digital Marketing Consultant to discover more about how you may start your performance marketing journey and leverage our expertise!