The 5 Steps to Selecting the Best Advertising Agency

If you are investing material dollars in marketing campaigns, more often than not, you have considered engaging, or have engaged, an advertising agency to assist you with those efforts. Those decisions whether or not to manage your marketing campaigns with in-house teams versus third-party agencies are typically not easy. And if you decide to outsource to an agency, the selection process can be overwhelming. This post will help make those decisions easier for you.

Read the rest of this post in Entrepreneur, which I guest authored this week.

For future posts, please follow me on Twitter at: @georgedeeb.

Why Google's Search Page Redesign is the Death of SEO

I have been a digital marketer for more than 20 years, which seems like an eternity at this point. Google has always been a staple of any good digital marketing strategy, especially for search engine optimization (SEO), to attract free organic traffic based on the quality of the content on your page. But, when we recently started to see our SEO traffic start to decline, we asked our SEO consultant to investigate the root cause. He said it was due to a recent Google Search page redesign, moving the free organic links to the bottom of the search results page. Even more troubling was his answer on how to fix the situation.

"Start spending more money advertising with Google to get back up to the top of the page,” he said. That's a very strange thing for an SEO expert to say because his services aren't needed in that scenario. This means SEO as a strategy for ecommerce-driven companies is dying, and paid search marketing has become your primary way to gain an audience through the search engines, at least through industry-leading Google. Allow me to further explain.

Read the rest of this post in Entrepreneur, which I guest authored this week.

For future posts, please follow me on Twitter at: @georgedeeb.

It's Time for 2021 Business Planning--Red Rocket Can Help

As we are about to start the fourth quarter of 2020, that means there are only three months left to complete your 2021 business plans.  If you need any help running your team through a strategic planning process, building budgets, detailing your sales and marketing plans or simply need an executive coach to help guide you through this process with a fresh set of eyes, Red Rocket is here to help.  Contact us to set up an appointment with one of our experts today, via the form at the bottom of this page.

For future posts, please follow us on Twitter at: @RedRocketVC.

Lesson #331: Master Your Marketing Funnel and Media Mix

 

One of the biggest struggles that companies have is knowing how to build an effective and profitable marketing funnel and media mix, and using the right metrics to manage such efforts.  And, for most startups, they really don't have the budgets to build an effective full funnel strategy, and typically focus on more immediate cash returning lower funnel tactics.  This post will help you learn the various stages of the marketing funnel, the right tactics and metrics to explore at each stage of the funnel and how to translate that into an effective media mix.

What is the Marketing Funnel

A marketing funnel is the process of making prospective customers aware of your brand in the first place, and then nurturing them over time into buying customers.  The upper funnel is making sure you have brand awareness to prospective buyers.  The middle funnel is making sure your brand is actively being considered when a customer is actively researching their options.  And, the lower funnel is doing everything you can to convert known active in-market buyers to purchase your product. The next stages, typically forgotten by most companies, are getting your customers to become loyal repeat buyers, and more importantly, to become impassioned brand advocates spreading positive word-of-mouth referrals to prospective new customers.

To help visualize this, take a look at this graphic from Marketing Edge Magazine showing the typical marketing funnel:

The Stages of the Marketing Funnel

Let's provide a little more definition to each of the above funnel stages for clarity:

Awareness:  A person is aware of your brand, whether they are buying right now or not.  If someone asks, what is the biggest brand names in soda makers, the names Pepsi and Coke come immediately to mind.  Unaided brand awareness is best, as top of mind with customers without any help.  Followed by aided brand awareness when presenting a list of companies in the space, and them recognizing your brand on the list.

Interest:  A person begins to learn more about your brand and offering, perhaps reading about it in an article or seeing it promoted in an advertisement. 

Consideration:  A person is in-market for products you sell, and is willing to learn more about your specific product.  Often comparing your brand to others at this stage, perhaps on reviews sites.

Evaluation:  A person has narrowed down the list to a couple finalists, and is digging into all the details and differences between various brands, product features and pricing.

Decision:  A person has decided that this one brand or product is the specific one they want to move forward with, when they are ready to buy.

Purchase:  The person officially becomes a customer, swiping their credit card on their first transaction with your company.

Repeat:  That same person has purchased multiple times from your business.  That can either be the same product in higher frequency, or new products altogether.

Loyalty:  That same person is dedicated to purchasing from your brand, anytime they have the need.  They would not consider other brands given their past satisfaction with your brand.

Advocacy:  That person is so passionate about your product, they start to spread the "gospel" and positive word-of-mouth referrals to their friends and family.  And, even better, they are promoting your brand on social media to all their followers (which in turn, helps to profitably build your upper funnel with new prospects).

Using the Appropriate Media Tactics at Each Funnel Stage

This diagram from Visual Paradigm does a good job of showing how you need to tailor your marketing efforts to each of the specific funnel stages:

At the top of the funnel, you are trying to get as much reach as possible, to make sure the market is aware of your brand.  Large brands may do this in television advertising, and startups may do this in more affordable social media advertising.  Once a user makes an action that signals that they are in-market for your products, you want to make sure they are aware of you on review sites and the search engines during their middle funnel consideration stage.  And, once they engage with your site, your lower funnel tactics will take over with things like digital retargeting ads and email follow ups.

But, getting them to buy is only half of the exercise, now you want to get them to buy again (through your email newsletter promotions and joining your customer loyalty program).  And, you want to ask them for positive reviews of your products and to share their love of your product or brand with their social media followers, turning them into brand ambassadors.  As you know, acquiring customers through positive word-of-mouth for free is a lot cheaper than trying to acquire customers with expensive advertising upper funnel.

Using the Appropriate Measurement Metrics at Each Stage

One of the biggest mistakes a company makes is using the same marketing metric across each of the funnel stages.  For example, they compare their cost of acquiring a customer (CAC) to everyone one of their marketing tactics.  If they did that, they would immediate bias lower funnel tactics, as the CAC from in-market lower funnel buyers will be a fraction of out-of-market upper funnel prospects.  That bias may help them drive an immediate ROI on their marketing spend, focusing on the most profitable tactics, but it would hurt them in terms of investing upper funnel and building long term brand awareness with which to better scale the company long term.

To me, your upper funnel would be measured on a cost per impression (CPM) or cost per visitor (CPV) metric, your middle funnel would be measured on a cost per lead (CPL) metric, and your lower funnel would be measured on a cost per acquisition (CPA) metric.  If you set the appropriate metrics for each stage, you will have a much higher odds of scaling your business long term.  It may be a little less profitable in the first few months of "funnel building", but long term you will have a much bigger and more profitable business, than if you simply focused on the lower funnel alone.

Doing the Appropriate Media Mix Modeling 

I prefer to grow my business profitably, not on a grab market share at any cost basis to "own" the market in the short run and drive profits in the long run (after years of huge losses).  So, with that as my guide, I typically split my media mix: 20% upper funnel brand building, 30% middle funnel development, and 50% driving lower funnel conversions.  That will give profits a "fighting chance" for success in the near term, within a few months of starting a campaign.

But, the mix here can be highly variable based on your customer sales cycle.  Let's say you are selling expensive automobiles and customers only buy a car every 5-10 years.  That will take a really long time for your upper funnel brand building to pay back.  So, maybe you should focus more on middle and lower funnel tactics only, to drive a more immediate return on your investment.  And, on the flip side, let's say you are selling an affordable consumable with a high repeat purchase cycle (e.g., Starbucks Coffee).  In that case, you may want to invest more upper funnel, to quickly build up the brand awareness and lock out competitors, as any losses you may incur in the short run from your media spend, will be recouped from the repeat purchases in the following months.

Concluding Thoughts

Doing your marketing funnel planning and media mix modeling is not easy, especially for first timers.  So, make sure you surround yourself by smart mentors, consultants or ad agencies that have deep expertise in this area, to ensure you don't flush your limited marketing dollars down the toilet.  But, hopefully, you now have a better understanding of how it works to help point you in the right direction to building a truly great brand, marketing success, revenue growth and bottom line profit.  If you have any questions on this stuff, don't hesitate to reach out to one of our fractional CMOs to help you with your marketing strategies and planning efforts.

For future posts, please follow me on Twitter at: @georgedeeb.

North Carolina Venture Capital Trends

In case you haven't seen it, the Center for Entrepreneurial Development recently published its 2019 Innovators Report.  It contains  venture capital data going back to 2015, covering funding, funders, deals, and exits. The report explores a number of useful categories, including year-over-year comparisons, sectors, locations, funding and investor types and much more. 

Its great to see the entrepreneurial activity in the Triangle area (and the rest of the state) is doing well.  Kudos to the team at the CED for pulling this together.


For future posts, please follow us on Twitter at: @RedRocketVC.

Lesson #330: The Importance of Conversion Rate Optimization

Getting new customers to your website is hard enough, having to block and tackle up against all your competitors' advertising on Google, Facebook and elsewhere.  But, that is only half of the challenge.  The other half--the more important half--is getting those site visitors to convert into a lead or a sale.  And, that process of maximizing conversions is known as Conversion Rate Optimization, or CRO for short.  This post will help educate you on what CRO is, how to do it and why this matters to your bottom line . . . big time!!

What is CRO?

At the simplest level, CRO is optimizing the ratio of conversions, however you want to define them (e.g., transactions on your website, email lead form submissions, phone calls) as a percentage of the total visitors going to your website.  So, as an example, an average ecommerce website may have a conversion rate of 3%, when looking at the ratio of online transactions to website visitors.  But, there are wide ranges in conversion rates; a brand new startup with no brand recognition may only convert 1% and a huge trusted ecommerce portal like Amazon may convert 8%.  Said another way, there is an 8x difference in revenues to be had, whether you are at the low end of the range, or the high end of the range.  So, CRO is a critical part of maximizing your revenues, and needs more focus than most startups give it.

How is CRO Optimized?

First, you are optimizing for every variation of your user experience across devices.  There is not a one size fits all solution.  Optimizing for desktops, tablets and mobile devices are completely different.  And, more often than not, in today's world, mobile is the most important experience that needs to be optimized, given it represents the majority of inbound traffic for most companies these days (although many designers are still overly focused on desktop design).

Second, you are optimizing your user experience (UX).  That includes things like your site's usability, navigation, page design, process design, email form design and overall site speed (and speed really matters for Google to get higher up their search results).  This is changing things like page headlines, copy, voice, creatives, offers, calls to action, colors, sizes, messaging, etc., constantly A/B testing different variations of each, to see which one helps drive conversions the most.

As you study users playing with your website, you are going to learn where the drop-off points are in the conversion funnel.  How many site visitors, lead to product searches, lead to shopping cart additions, lead to starting the checkout process, lead to a completed sale.  Every step of that process needs to be optimized, from beginning to end.

Third, another part of CRO is seeing how your marketing efforts impact conversions.  Do any marketing channels work better or worse?  Any variations by customer demographics?  Do variations in landing pages from the ads, have an impact on conversion rates?  Do certain products convert better than others?  So, this is not only about optimizing the UX of your site, it is working in partnership with the marketing department to optimize what they are doing, to help maximize conversions.

How is CRO Measured?

There are many ways to study your UX, to learn how consumers are engaging with your site.  You can survey customers to learn what they like and don't like about your UX.  You can A/B test different variations of your page design, to see which version performed better.  You can study your Google Analytics data, and they have ecommerce funnel optimization tools, to learn where the drop-offs are happening.  There are many technologies that can help you learn here--things like heat mapping where a user's eyes are focused on the page, recording user web sessions, doing scroll bar mapping or using other software that can help you study your customer journey on your website (e.g., Content Square, Crazy Egg, Hello Bar).

Who Can Help Me With CRO?

And, if you don't have an internal UX team or enough time to do this yourself, there are many agencies that can help you audit your CRO and make specific optimization suggestions for as little as $5,000.  There are dozens of agencies that can help you here, but I know agencies like The Good, Mirgo Digital, Underwater Pistol, Thrive Digital, 1 Digital Agency and Boostability have expertise as CRO focused agencies.

Closing Thoughts?

Too often an entrepreneur is focused on getting a minimum viable product into the market as quickly and cheaply as possible, which is the norm for most lean startup launches.  But, your website experience is a key part of maximizing revenues, and it needs professional attention, sooner than later. 

Imagine you were shopping in a retail mall, and you walked by a store where the front door was half closed, the light bulbs were off and you couldn't walk through the aisles of the store without bumping into the racks of merchandise or other shoppers.  You would simply leave and move on to the next store that gave you a better experience.  It is that same logic online, with the hundreds of competitors trying get those same customers to visit their websites. 

So, with a little bit of effort here, you can materially increases your revenues and profits by expanding your conversion rates--the only metric that really matters at the end of the day.


For future posts, please follow me on Twitter at: @georgedeeb.