Mike Tyson once said that everyone has a plan until they get punched in the face. Business owners and entrepreneurs get punched in the face far too often and are far too surprised when they do.
Traditionally, business owners have relied on third-party reports and gut instinct when evaluating market research. Unfortunately, a few Google searches and conversations with friends don’t constitute true market research.
According to a FORTUNE Knowledge Group study, 62 percent of executives believe gut feelings and other soft factors are key to running a company. However, developing strategies without supporting data can’t account for unique factors such as how the market feels about a new product or whether the pain point is worth solving.
Today’s market demands data-driven decisions made in real time, requiring access to a continuous flow of reliable data to keep operations running smoothly.
In China, Alibaba recently introduced a new marketing system (dubbed “Uni Marketing”) to provide companies with real-time data about consumer behaviors. This ability to target demographics as they shift will help Chinese businesses make more informed marketing decisions.
Don’t trust instincts — listen to your market. Solicit feedback and translate it into usable data that empowers you to make better decisions.
One of our clients recently wanted to use digital marketing to ramp up revenue for one of their products, which solves pain points in business intelligence software. They were spending about £5,000 a month on Google AdWords and Facebook and wanted to use that budget to validate new audiences to target. While they aimed to expand their scope to include targets in new job roles, they had no data indicating whether that strategy would impact their return on investment — nor any defined method to discover that information.
In the end, we built a new market research framework that clarified which audience would respond best to their campaigns, increasing ROI by 200 percent and scaling up marketing spend to £20,000 per month. Had the company’s leaders gone with their instincts and expanded campaigns to include more users, those results would have been difficult to achieve.
Gathering and relying upon concrete data increases your marketing ROI without the guesswork. Follow these four strategies to leave instinct behind and start building a system of repeatable, scalable success.
To discover an approach that works for you, implement tests across multiple channels with varying messages. What works well on Instagram, but not on Facebook? Why does this email have a high click-through rate, but the same content on the website gets ignored? Try personal and creative messaging and see whether your response rates improve.
Beyond testing your messaging, find unique ways to reach the customers you wouldn’t normally think of. Don’t assume that tactics such as web scraping won’t work — try it and evaluate the results. For example, when we launched our last cold email campaign, we didn’t send out a shotgun blast. Instead, we spent time researching the contact information of local restaurant owners through Yelp, which helped us gain around 50 new contracts with venues, and thousands of prelaunch customers.
Your executive team might love releasing new videos every week, but if no one’s watching them, ditch the waste of expensive resources and direct that money and manpower elsewhere. Examine the results of your channel tests and see which ones produce the highest ROI. Don’t overlook a channel because it’s outdated or boring or for another non-monetary reason. Identify activities with low ROI to change or eliminate, and put more money toward high-ROI endeavors. When ROI starts to taper off, maintain your spending at the optimal level and start investing in other areas with high promise.
For example, we always thought AdWords was too expensive, too crowded and too inefficient for our model. For the sake of being thorough, we gave it a shot — only to see an immediate spike in earnings. Nothing should be written off until its fully tried and tested.
Over the duration of your customer interactions, how much is each conversation worth? You control that number through the price of your product or service. By finding the sweet spot between selling yourself short and pricing out customers, you can maximize your ROI.
In the early stages, you might think that simply having customers validates the price your gut told you was correct. What if that price is preventing you from scaling, or leaving out thousands of customers who think your product is just a bit out of their range? Until you conduct price tests, you can’t know.
Fortunately, finding the right price is easy. Start by running campaigns to convert customers at a lower monthly price. Achieve early conversions, and then seek the price point that works best for you.
As long as you have the right product-market fit, you can benefit from some out-of-home (OOH) marketing, such as television ads, events and other non-digital marketing initiatives. Although direct attribution gets murky outside the digital plane, you can boost the ROI of your existing campaigns by placing messaging in unexpected places to draw more eyes to your digital pieces.
Creative execution is key on out-of-home pieces. When you create copy to persuade your target audiences with OOH marketing, the language and creative directions you choose become critical. Launch a small set of ads targeting your best demographic, testing multiple copy and creative approaches as you do.
Monster, for example, used OOH initiatives in the form of outdoor advertising to introduce a younger generation, which hadn’t experienced the brand’s earlier marketing efforts, to the purple monster character, its new brand ambassador. The campaign incorporated ads on buses, in shopping centers and in underground Tube stations, as well as commissioned street art in high-traffic public sites around England.
With 77 percent of its target audience viewing the ads, Monster reported higher than average recall and corresponding significant increases keyword traffic. This illustrates how OOH efforts can be effectively leveraged to drive greater awareness on digital and other channels, consequently boosting awareness and conversions.
The more data you have, the better decisions you and your ground-level employees can make. Next time you face a marketing decision, don’t wing it. Don’t trust instincts. Get as close to your market — and the people that define it — as you can. Demonstrate that you are listening to them by translating their actual feelings into data that will inform your decisions. Follow these strategies to collect and act upon data that will boost your ROI and grow your business without guesswork.