3 Ways to Maximize Budget Efficiency

Amid market volatility and economic uncertainty, CMOs worldwide are wrestling with tightening budget constraints, with over 70% claiming insufficient funds to fully execute their 2023 marketing strategies. 

Matilda Rose Moir

As it stands, marketing budgets compose approximately 9.1% of total company revenue, a 4% decrease on 2022. The following blog examines three different ways you can maximize your budget efficiency, and make your investments work both harder and smarter during economic uncertainty:

  1. Identifying and eliminating waste
  2. Using AI and automation to drive effectiveness
  3. Creating new revenue streams

Identifying & Eliminating Waste

The primary method of maximizing budget efficiency is to identify and eliminate the ‘deadweight’ avenues within your marketing mix. Removing the channels that drain time, resources and budget without driving performance. Marketing has changed more in the last three years than the last fifty and, as such, businesses are often  set in their ways when it comes to legacy processes, structures and tools. 

Look at the rise of TikTok as an example. In 2019 TikTok was generating $0.17 billion in revenue – with advertisers prioritizing alternate channels such as Twitter ($1.60), Instagram ($12.40) and Facebook ($18.87). Fast Forward to 2023 and TikTok has grown by 3917% – expected to generate over $6.8 billion in ad revenue by the end of the year.

Priorities change, and in times of economic uncertainty you need to eliminate waste, removing legacy and/or dated approaches that stagnate your growth. Reconsider your attribution model – how are you attributing business growth? Identify the tangible and intangible impact of your activity, using test and control groups to eliminate false drivers. 

Additionally structure your activity in a way that allows you to maintain complete control and visibility over performance at all times -remaining reactive to real-time data.

This is what we did for UK health and beauty retailer, Superdrug.

There is an age old question in Marketing, “do I need to invest in paid ads, when I am performing well on organic search?” And this is exactly what Superdrug wanted to know. They asked uS to maximize the efficiency of their paid search spend, and reduce the risk of their paid activity cannibalizing their organic coverage.

Using our bespoke ML tool, Seamless Search, we assessed millions of data points, pulling keyword level data from Google Ads and Search Console to model a picture of total revenue by keyword achieved. We then automated Paid bidding decisions based on a search terms organic position. To understand the value of the bid changes applied by the Seamless Search platform, an A/B testing feature was built to see how performance of a control group, not managed by the platform, would compare.

Analysis after the first 90 days showed: +102% Higher total ROAS from Seamless keywords, a £53.3k incremental return from Total Search  and a -50% lower CPC’s with a minimal disruption to CTR.

Using AI & Automation to Drive Effectiveness

AI, automation and other intelligent solutions are invaluable in helping businesses identify the best channels, audiences and messages to drive ROI. As such, it has become a key priority for advertisers. 

In-platform automation has become the norm, but this is not without its limitations. Standardized automation, or off-the-shelf software comes with a significant lack of control – and the same approach is often echoed across multiple brands. 

The solution? Bespoke, tailored tools that help you regain control while driving performance. 

Leveraging the power of bespoke AI solutions can help maximize the impact of your available budget and discover new opportunities to further drive growth – across Media, Creative and Experience. Great performance is a result of seamless cross-channel integration, and intelligent solutions, tailored to your brand can help you achieve it.

This is what we did for the world’s largest cosmetics company, L’Oréal.

Remember: AI and automation is only as good as the data that feeds into it – cross check your data quality and accuracy 

Consumers often don’t understand how the environment affects their skin and therefore don’t see the need for a skin analysis – especially not via digital consultation. Yet, consumers expect to be approached by brands with relevant information about what skincare products they need. L’Oréal wanted to explore a way to increase their ad effectiveness by adding this level of personalization to better educate consumers on skincare, provide valuable insights of the effect of the environment on their skin, and convince them to take further action with L’Oréal (Vichy).

Using a GEO-location DCO strategy combined with Seamless Creative (Incubeta’s bespoke ad personalization platform) we simplified campaign setup by compiling unlimited dynamic creative variants. Ads are personalized at LI level, providing appropriate key visuals and ad copy, triggered by real-time UV, Air Quality, and Pollution Indexes.

Comparing activity to static ads used in previous campaigns we saw: a 48X increase in Engagement, a -56% decrease in CPA, a -89% decrease in Time to Launch.

Creating New Revenue Streams

As consumer behavior shifts, and marketing budgets are having to work harder than ever before, identifying new ways to sell, and new channels to explore is key to remaining agile and competitive in your market.

Over reliance on a singular revenue stream is risky – you should be diversifying your strategy, exploring a wider range of solutions to drive business growth.

Go back to the basics and consider where this growth can come from. Creating new revenue streams doesn’t necessarily mean starting from scratch. While this certainly has its benefits, it’s important to also see the value in existing channel amplification such as international market expansion.

It’s about finding new places where you can drive demand for your services. Monitor the market and, for want of a better phrase, follow the money. Look at where people are spending money and ask yourselves the following questions:

  • Where are your consumers? 
  • What markets are thriving? 
  • What channels can help you access your target audience?

This is what we did for major British multinational retailer, M&S.

Looking to maximize their return on ad spend, M&S wanted to tap into, and explore new channels of revenue – namely international expansion.

We started by developing a custom cloud-based platform that handled thousands of data points across the 200 markets to plot that specific country’s potential and complexity. From here we developed a scoring system, and established a unique score for each market to understand the key behavioral characteristics, and potential of individual countries. It was important that we created an easy user interface to view this data so we created a Market Matrix which categorized each market into specific tiers – based on their individual scores.

Once we identified the potential of each individual market and placed them in the appropriate tier, we built a separate strategy and approach for each tier to maximize success

By optimizing performance across all 34 target markets we saw a +477% Increase in ROAS.

For more information on how you can make your budget work harder during economic unrest, get in touch

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