Read Time: 3 mins 30 seconds
By Craig Brown, Head of Delivery at Incubeta US
It feels like it’s becoming more and more difficult to win in marketing these days. Increases in complexity, platforms, and walled gardens are all contributing factors, but the greatest issue will always be: how can this advertiser afford to pay that much?
The marketing world is becoming increasingly based on real-time auctions, and 30% of US households today are only reachable through Connected TV. The approach to winning needs to change. The fastest-growing and most advanced advertisers are looking at the value of a customer beyond the time of conversion and the last interaction that drove it.
With these changes in mind, Incubeta has developed five core business principles that will help advertisers CLIMB the auction rankings and begin to acquire more, and higher value, customers, with the ultimate objective of increasing the business’ overall profitability.
Focusing on individual channels does not set you up for success, and neither does concentrating solely on paid media. Your marketing efforts should have an impact on your topline profitability, and CLIMB helps you reach that goal.
CLIMB represents our five principles of:
All interactions with a consumer have a conversion point. When we talk about conversion, we don’t just mean the propensity of a consumer to buy in-store or online, but rather every interaction you have with a customer. Increasing your chance of converting on each interaction with your business has a ripple effect on your ability to win.
Not all customers are created equal or behave equally, so it’s essential that advertisers use data to make more nuanced decisions in the auction environment. To truly win at business, it’s not enough to just acquire new customers – you need to acquire the most valuable customers over the long term.
Leading advertisers are using their data to predict the lifetime value of newly acquired customers and feeding that information back into their data, which allows them to bid more. These advertisers are also focusing on what defines their highest value customers online, so they can better identify more consumers with the same characteristics and acquire those users more efficiently and effectively. This approach relies on leveraging the data available to you, which includes first-, second-, and third-party data.
Effective marketing strategies require information from all areas, but the extent of insights that marketing can give you about your business is often undervalued. Cross-team silos continue to be a significant challenge for businesses, and the amount of data can often be overwhelming. Using technology to help prioritize the data available to you and turn it into actionable insights addresses both of these issues.
We all understand that business decisions need to be data-driven, but we don’t always have the time to transform data into insights and actions. The more that this process can be automated and shared across business units, the greater the ability you will have to make the right decisions for profit.
Understanding your consumer journey and behavior is vital to winning as a business. If you are running media and only measuring online, you may be missing 50% of the value of your marketing if you also have an in-store element. This means that the decisions you make in a programmatic auction are only valuing 50% of your conversions, bidding half as much as you are able to. If a competitor is correctly measuring their efforts while you are not, they will bid double the amount you can, beating you in most auctions.
The steps above are all built to help you win in programmatic auctions, but there is still room for improvement on the media buying side. Ensuring your data is accessible for the auction is essential, but it is not enough to win auctions on its own. A deeper understanding of how auctions and machine learning optimization algorithms actually work allows advertisers to structure their data and approach to ensure the algorithms know the true value of each conversion and how to best win that auction.
If you want to learn more about our CLIMB methodology, follow our upcoming blog series here.