31st July, 05:30pm – “An amount of Rs. xxxxxx has been credited to your salary account…” the most awaited SMS of the month! But what happens next? A lot of us face a similar challenge of maintaining a balance between our earnings and spends/expenses. The major hurdle is lack of planning. This scenario can be also observed in the case of digital advertising spends.
55/5 rule of problem-solving suggests that often it is preferable to spend more time on identifying and properly framing the problem before trying to solve it. The proportion 55/5 comes from a quote attributed to Albert Einstein who supposedly said that if he had only one hour to save the world he would spend 55 minutes identifying and formulating the problem and only 5 minutes solving it. If we try to relate this to digital marketing industry, a media planner should spend more time in planning the campaign objectives rather than taking it LIVE in a hurry.
At the time of campaign planning and optimization, media planner should try and make different categories of campaigns based on goals that he receives from the client.
For example: Daily delivery goals: 10k to 1L impression, 1L to 5L impressions, 500 to 2000 clicks, 2000 to 5000 clicks; CTR goals: 0 to 0.1, 0.1 to 0.5. 0.5 to 1.0, 1 to 3 etc.
Once you have these categories in place, try to fit the campaign in respective category.
In digital advertising industry, media planners should try to follow 20-50-30 rule for efficient delivery of campaigns.
What does it mean? It means the total spend should be divided into 3 phases – 20%, 50% and 30%.First phase – Experiment
The first phase “Experiment” is the most important aspect. The first 20% of the budget should be spent by tweaking the campaign attributes in such a way that it would meet the campaign goals. For example, if campaign goals are – daily delivery of 5L impressions and CTR min 0.5% then it is clear that the campaign need to be focused on large delivery and less on its performance. In order to achieve the goals by keeping maximum possible gross margin, one of the experiments I would perform on this campaign would be – target it on inexpensive site at high frequency.
In addition to that, in this phase – try to target the campaigns on all verticals (sites and segments/audiences) which seem relevant to the campaign.
Second phase – Blast
Analyse results which you got in first phase and choose best combination of campaign attributes which are likely to give best results in terms of RIO and campaign goals. Take this combination and extrapolate it making a blast. 50% of the budget should be spent in this phase. Monitor the performance of the campaign and make sure it is giving expected ROI.
How to calculate ROI? – in general terms, ROI = Revenue/expense but in digital advertising industry campaign performance is equally important. So here the ROI concept is – what is output of campaign performance (CTR/CR) when input is campaign different attributes. Example: There are two sites – S1 which is premium site and S2 is a normal site; when a campaign is targeted on these sites separately, and you notice that there is a minimal difference in CTR on these sites then ROI of serving campaign on S2 is more than serving it on S1.
Third phase – Retarget
Before moving to this phase, planner should plan in such a way that all the remaining backend goals are met in this stage. In order to make this happen, historical data acts as a treasure here. Say for example, you did and auto company campaign few months ago and you again receive a similar campaign but from a different client. Still the historical data of the previous campaign can be utilized as a learning material. This will help you in choosing the best remark audiences and also the ones that never performed earlier.
Slice and dice the historical data and make inferences out of it which will be used for optimizing the current campaigns site wise – category wise – impressions, clicks, CTR
Segment wise – counts
Don’t spend the entire budget at once instead play safe by breaking your budget in these 3 phases and treat all the phase as a new campaign setting. Try not to mix earlier settings. Utilize the learnings from historical data wisely and effectively.