Creating A Data-Driven Connections Plan
BY MICHELLE THOMAS – DIRECTOR OF CUSTOMER ENGAGEMENT STRATEGY
I was recently having lunch with a former colleague when she asked me to provide an opinion on how her marketing budget was structured. Specifically, she asked me, “If you were in my shoes, how would you allocate and optimize my current media budget?”
If you had asked me three years ago, I might have hastily offered a generic response, focusing on matching the “right” media to the “right” stage of the conversion funnel. If I had drawn it, it might look something like this:
However, I realized that what used to seem like a simple question with a simple answer wasn’t so simple at all.
Instead of giving a quick and easy response, I gave the dreaded answer, “It depends,” and went on to ask a series of follow-on questions:
- What is the current business strategy?
- Is the company working towards specific objectives?
- What is the general health of their business?
- Are they still in growth mode or have they matured as a company?
- Which KPIs are they using to determine and measure marketing/media success?
- What do they know about their customer?
The conversation went on and on, until I was temporarily out of questions. At this point, I would normally take a white boarding approach and try to map an answer out. Instead, I sat back with a sparkle in my eye and said, “I can’t answer that!” Boom. I nailed it!
During this conversation, I realized that traditional media mixes and budget allocations don’t take into consideration the actual customer, their behaviors, and the value they bring to the organization. With constrained resources, the media budget almost always skews towards acquisition and getting as many customers as possible, regardless of what that means for the future of the business. And let’s face it, paid media just isn’t a cost-effective way to reach or influence existing customers unless it’s a type of paid media that straddles the border between paid and owned (e.g., email or display retargeting).
WHAT’S A PLANNER TO DO?
There are three steps that can help media buyers and planners gain strategic alignment, which will help throughout the planning process.
Step 1: Make sure your team and agencies are aligned on the company’s strategic goals and the general health of the business
Media budget allocation should first depend on the business lifecycle and the general health of the company, which helps guide the right balance of acquisition, retention, and growth strategies.
For the purposes of our example, I will use a fictitious health and wellness company I’m calling “Honest Goods”—a mature company that has three strategic goals:
- Introduce a new category/service offering
- Grow profitability
- Enhance the overall customer experience
Step 2: Profile the segments that make up your customer portfolio and align your strategic goals with what you know about your customer
A customer portfolio is comprised of different groups or segments that make up your customer base. We realize that there are countless ways to create these groups of customers; however, some of the most actionable insights come from the combination of behavioral and attitudinal data.
Since Honest Goods is in a mature state, we should focus on retention and growth strategies. Here is an example of segment profiles for Honest Goods:
Step 3: Create a connections plan for your customer portfolio
In the traditional sense, many media buyers and planners execute off a high-level communications plan that covers a very broad customer base. But in today’s connected world, that’s no longer enough. A connections plan allows you to outline a deeper strategy for engaging with all parts of your customer portfolio based on what they want, need, and how they behave—and it’s not a one-size-fits-all.
The goal is to create an optimized media mix for each customer group that is comprised of paid, owned, and earned media. For paid spend, a traditional media planning approach might decide to spread the media investment evenly across the three segments. However, by understanding the makeup of the customer portfolio, media planners have insight into what level of investment can be made for each customer group with the intent of maximizing the return on advertising spend (ROAS) and minimizing wasteful spend or resources.
Here is an overly simple example of Honest Goods’ media allocation:
By customizing the media tactics and messaging to the intended audience, and further matching the right channel mix to those customer groups, media planners will have the foundation for a powerful and dynamic connections plan. However, the question still remains on whether or not we have optimized our media to be the most effective and efficient. The answer to that question will be addressed in my next post.
Creating A Data-Driven Connections Plan
BY MICHELLE THOMAS – DIRECTOR OF CUSTOMER ENGAGEMENT STRATEGY
I was recently having lunch with a former colleague when she asked me to provide an opinion on how her marketing budget was structured. Specifically, she asked me, “If you were in my shoes, how would you allocate and optimize my current media budget?”
If you had asked me three years ago, I might have hastily offered a generic response, focusing on matching the “right” media to the “right” stage of the conversion funnel. If I had drawn it, it might look something like this:
However, I realized that what used to seem like a simple question with a simple answer wasn’t so simple at all.
Instead of giving a quick and easy response, I gave the dreaded answer, “It depends,” and went on to ask a series of follow-on questions:
The conversation went on and on, until I was temporarily out of questions. At this point, I would normally take a white boarding approach and try to map an answer out. Instead, I sat back with a sparkle in my eye and said, “I can’t answer that!” Boom. I nailed it!
During this conversation, I realized that traditional media mixes and budget allocations don’t take into consideration the actual customer, their behaviors, and the value they bring to the organization. With constrained resources, the media budget almost always skews towards acquisition and getting as many customers as possible, regardless of what that means for the future of the business. And let’s face it, paid media just isn’t a cost-effective way to reach or influence existing customers unless it’s a type of paid media that straddles the border between paid and owned (e.g., email or display retargeting).
WHAT’S A PLANNER TO DO?
There are three steps that can help media buyers and planners gain strategic alignment, which will help throughout the planning process.
Step 1: Make sure your team and agencies are aligned on the company’s strategic goals and the general health of the business
Media budget allocation should first depend on the business lifecycle and the general health of the company, which helps guide the right balance of acquisition, retention, and growth strategies.
For the purposes of our example, I will use a fictitious health and wellness company I’m calling “Honest Goods”—a mature company that has three strategic goals:
Step 2: Profile the segments that make up your customer portfolio and align your strategic goals with what you know about your customer
A customer portfolio is comprised of different groups or segments that make up your customer base. We realize that there are countless ways to create these groups of customers; however, some of the most actionable insights come from the combination of behavioral and attitudinal data.
Since Honest Goods is in a mature state, we should focus on retention and growth strategies. Here is an example of segment profiles for Honest Goods:
Step 3: Create a connections plan for your customer portfolio
In the traditional sense, many media buyers and planners execute off a high-level communications plan that covers a very broad customer base. But in today’s connected world, that’s no longer enough. A connections plan allows you to outline a deeper strategy for engaging with all parts of your customer portfolio based on what they want, need, and how they behave—and it’s not a one-size-fits-all.
The goal is to create an optimized media mix for each customer group that is comprised of paid, owned, and earned media. For paid spend, a traditional media planning approach might decide to spread the media investment evenly across the three segments. However, by understanding the makeup of the customer portfolio, media planners have insight into what level of investment can be made for each customer group with the intent of maximizing the return on advertising spend (ROAS) and minimizing wasteful spend or resources.
Here is an overly simple example of Honest Goods’ media allocation:
By customizing the media tactics and messaging to the intended audience, and further matching the right channel mix to those customer groups, media planners will have the foundation for a powerful and dynamic connections plan. However, the question still remains on whether or not we have optimized our media to be the most effective and efficient. The answer to that question will be addressed in my next post.
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