The Marketing Campaign Optimization Process
Acquire 25% more leads at 19% lower cost per lead
Highlights
- The highest performing marketing campaign optimization process uses portfolio management as a structured way to govern and improve multiple campaigns at the same time. It also spreads investments and risk and delivers a more consistent inflow of sales leads.
- This marketing campaign optimization process manipulates programs to increase overall results. It maximizes the value of the total portfolio by reallocating budget based on real-time measurable progress and shutting down programs that fail to show progress or project value.
- The end goal is to acquire more sales leads at a lower cost per lead. That permits marketing to acquire more leads for the same investment and increase marketing ROI.
The Top Marketing Campaign Optimization Process
The sales force is marketing's customer, and their number 1 request from marketing is sales leads.
Marketing campaigns are the top tool to acquire sales leads.
Marketing campaign research published in the Marketing Transformation Report uncovered some stark differences when measuring conversions and results.
You might expect the research to show varying conversion rates among different types of campaigns. And it did.
But the much larger difference in conversions was not among campaign types but among marketing types. That is, the person, not the tool.
The research found that the Best-in-Class marketers (i.e., the top 15 percent) acquired 25 percent more sales leads at 19 percent lower cost per lead, based on equivalent investment, on average.
When drilling down further, the data revealed that these top marketers managed an average of 4 to 9 campaigns at any one time, compared to 1 to 4 for their lower performing peers.
But it wasn't just the higher number of programs that drove the highest conversions. It was how they were orchestrated, or what the industry often calls Marketing Campaign Management.
The Best-in-Class marketers applied campaign portfolios to diversify risk and achieve synergistic results. They actively managed and manipulated the portfolio with a combination of campaign types and methods that collectively maximized conversions and downstream financial results.
They continuously measured performance, ranked campaigns in real-time and frequently reallocated the marketing budget from poor performers to higher performers.
That stood in contrast to their lower performing peers who managed a smaller, less balanced and more stagnate portfolio. These marketers put all their eggs in a smaller basket, did not systemically diversify their portfolio and chose not to reallocate investments at nearly the same pace.
The research found that this marketing campaign optimization process prioritized limited investments toward the biggest payoffs and was a top contributing factor to acquiring more sales leads at less cost.
Research shows that top marketers used a marketing campaign optimization process built on portfolio management to acquire 25 percent more sales leads at 19% lower cost per lead.
Click to TweetIf you would like to apply these research results for your own benefit, then consider this 4-step process.
4 Step Marketing Campaign Optimization Process
Start with Your Ideal Customer Profile
My father taught me at a young age you can't please everybody, so focus on those that are most important to you.
The Best-in-Class marketers know they will achieve the highest conversions and the lowest cost per lead by targeting the highest fit audiences. And they don't just get more leads, they get better leads.
And that delivers downstream benefits. Sales cycles are accelerated, and sales conversions improve by low double digits when salespeople engage the top fit prospects. And beyond the sale, customers in your Ideal Customer Profile (ICP) achieve higher customer lifetime value (CLV) and longer customer retention. The customers in your ICP are your most valuable customers, so start there.
The ICP uses data to measure and segment customers by fit. Data can cluster or group customer characteristics, attributes or behaviors to show the highest fit and most lucrative prospects.
Calculate Your Lead Volume Target
Precision marketers apply specific investments to achieve slated outcomes. Their goal is not to acquire 'lots of leads' for the sales force but instead to deliver an agreed upon volume of sales-ready leads at an agreed upon cost per lead. These agreements are usually solidified in a Sales and Marketing Service Level Agreement.
So how many leads do you need? Well, that depends on your revenue target and your sales cycle conversions. It's a question that’s best answered with revenue engineering.
Start with your revenue target and work backwards through the lead-to-customer sales funnel. That calculation will show how many leads need to go into the top of the funnel to achieve the number of closed deals coming out of the bottom that nets your sales goal.
Your campaign portfolio will directly impact the model. Each type of campaign earns different conversion rates, lead quality and cost per lead. For example, some types acquire more qualified leads which start further down the sales funnel and close more quickly.
Also, recognize that as the volume of needed leads rises, so does the cost per lead. By finding the optimal cost per lead at varying lead volumes for each type of campaign, you can shift your investments to get the best overall results.
Calculate the Optimal Campaign Mix
Now it's time to orchestrate the campaign portfolio.
The goal is to assemble the optimal mix of campaigns that yield the needed number of lead acquisitions at the lowest cost.
It's a 2-step process of selecting campaign types and timing.
There are many types of campaigns so putting them into categories creates a filtered approach that can be manipulated at higher levels. The types can be categorized as digital or physical, inbound or outbound, or by many other factors.
In many industries it's become obvious that several traditional lead generation programs are giving way to more innovative, measurable and productive programs such as inbound marketing, content marketing, social marketing, digital marketing, integrated marketing and influencer marketing.
This does not mean that trade shows, alliances and the programs that have become commonplace over decades should be disregarded. But unless they can be integrated with other campaigns to add value or otherwise modified, they should be deprioritized to allocate the limited marketing budget to the most productive techniques.
Also, while promotions targeted at net new customer acquisitions get the attention, it is generally a big mistake to ignore farming the existing customer base. Your campaign mix should include programs to retain and grow existing customers and recover customers that have churned.
You also need to account for buy cycle timing. Different programs engage prospects at different stages in their purchase journey. The below diagram shows an example of how different types of campaigns impact timing.
Self-educated buyers conduct more of their purchase journey in online channels and without engaging vendors until much later in the process. This means marketers must deploy more types of campaigns that meet these customers where they frequent.
Only by modeling these types in the aggregate, that is the portfolio, can you manipulate the mix and see the cumulative effect.
Campaign Reporting is Needed for Continuous Improvements
No marketing campaign optimization process is complete without real-time analytics.
Marketing campaign reporting should connect data, insights, action, and outcomes. When you create these links, the reporting becomes less about measuring historical performance and more about improving future results.
Dashboards are the top delivery tool to show what's working, what's not and when changes need to be made.
Most dashboards only display historical data. Better dashboards shift from lagging to leading indicators. And the best dashboards enable metrics to be interactive, so marketers can perform What-If modeling and scenario planning.
And no campaign lives in isolation. So, an aggregate view is needed to show how they rank among each other and perform together.
Takeaway
Without an overarching strategy, marketing budgets revert to a model based on capacity and not prioritized objectives.
A better approach is to apply portfolio management to govern a mix of projects, balance your risk tolerance and allocate your limited resources to maximize your financial return.
It's a holistic approach that orchestrates the right mix of campaigns pursuant to an overall financial goal. It calculates how each contributes to the collective goal, allocates budget based on contribution, shifts the budget based on real-time performance, and shows how each campaigns can impact others and be accelerated to deliver a much a higher cumulative effect.