Some Personal News
#19 Proving the value of media is best done by showing the scale gain
Happy Sunday. A very warm welcome to all the new subscribers. I’m thrilled to have you as readers and truly appreciate your feedback and support. In this edition we’ll get into how to demonstrate value in every marketing channel to the CFO, and talk about diversifying your media mix with TV.
Let’s dig in!
News to Peruse
Meta added Instagram audience targeting for Facebook and IG Ads.
You’ve been unable to create a custom audience of your Instagram followers until now. Could be a very handy option for Social Media Managers who will have struggled to focus on your IG followers specifically - which is generally much different to your Facebook following.
Practical application 1 > you can now use this as an Ad targeting option to reach people who’ve shown interest in your brand on IG.
Practical application 2 > use it as your source for a Lookalike Audience.
Microsoft is taking the best parts of Teams and packaging them up for Groups and Communities to use for free.
My social channels this week have been abuzz with the release of ChatGPT - a conversational AI that answers questions by combining the best answers from the internet. Many are speculating that it could one day replace Google searches. It can even write code. And it will completely change the SEO industry.
Check out last week’s edition of this newsletter for some powerful use cases
Google Analytics 4 (GA4) recently introduced two new metrics: Views Per Session and Average Session Duration. Use these to get a better understanding of visitor engagement on your site.
Say hi to a new Google Ad format: side rail ads.
For those who haven’t given up on Twitter, the platform is expanding tweet recommendations. This could mean more exposure for your account - but users can still avoid recommendations by switching to the chronological Latest Tweets feed.
How to Defend a Marketing Channel
End of Year fundraising is in full swing. Campaigns are set up and running, and your donation revenue should already be topping last year’s numbers year-to-date given the effect of everything we’ve implemented ;) But how to prove the value of your chosen marketing channels as a part of a wider portfolio to the CFO?
This newsletter has said since Edition 1 that we must think with an audience-first mindset and that any talk of “channels” is secondary. That is still the case, as is our approach to spotting opportunities - we look to processes that give us more budget fluidity, so we can switch channels to scale at greater velocity. The winning strategy remains the one that pinpoints the factors that truly move the needle and we focus our resources on those activities. But often when discussing investment and levers that can be dialed up or down with a CFO, it’s channels that will be discussed, even by way of example.
ROI or ROAS is the return on investment or advertising spend. It’s not the conversion rate from an Impression to the Conversion but the value of dollars you have spent. As any investment advisor would tell you, compound interest is the main principle of investing.
So, the impact of a digital channel on the entire digital journey is precisely that – compounding interest, increasing the value of the whole funnel and working together with all other tactics you are implementing – optimized donation forms, high converting landing pages, etc. – to increase the total impact. In preparing for meetings with CFO’s or the Budget Committee I’ve usually employed TWO ways to showcase value creation.
Easy: The Compound Effect
Back to good ol’ last click for a moment. It’s hard to argue that the salesman at the car dealership had no impact on you buying your new car – even though there were probably at least 100 people involved in it before, from designers to production engineers to market researchers. Same with digital marketing – retargeting and that last closing click has its value, no matter what. But a better-than-traditional way to illustrate its value is to show the losses if you didn’t have it.
A simple way to do that is to show a lift in conversion rate. Imagine you’re running just two advertising channels, let’s say Email and Display retargeting. Head straight to Google Analytics and do the following:
1) Create a segment of users (say over the last three months) that have an email in their sequence of interactions:
Do the same for those who have an email and a retargeting impression:
Now, create a custom report where the only metrics you care about are Sessions and Transactions (~Donations). The dimension can be any, as you’ll be overlaying your segments over it anyway. Your goal is to calculate the Conversion Rate. In my experience, it’s usually significantly (10-15%) higher for those who have had Retargeting in the funnel.
But now, the most crucial step is moving from conversion rates to the value of the funnel. And here, the Cost of Touch (CoT) will help us. One email can cost you anywhere from $0.1 to $1 to send – you know your numbers better than I do. You can calculate your CoT by dividing the total Email program cost by the unique number of email addresses it was delivered to – excluding the bounces. On the other hand, one retargeting impression is somewhere around $0.005, assuming the $5 CPM (again – please check against your numbers). So, we are getting a 10% conversion rate increase – for increasing the cost of touch by 5% (at the maximum). Perhaps such an excellent deal to consider following every email with a retargeting digital impression ;)
The above is the most straightforward example - retargeting is an easy target. I’ve used this approach successfully to prove the value of every other channel, focusing on paid social and display as the supporting channels.
Harder: Introduction Value
Flipping the story from Closing Value to Introduction Value is not easy. The compound effect we discussed in bullet #1 is effectively about closing – one channel (retargeting) helping another 1 (email) convert the user it introduced. The cost of missed opportunities is easy to understand – if the user doesn’t become a donor, the money spent on them is wasted.
It’s harder to explain the value of “introducing” the new channel. Imagine you’re testing a prospecting display campaign but don’t know its actual value, and neither does your organization. You, however, have had a successful Paid Social campaign running for a while. What better way to show the newbie channel’s value than how it’s assisting a veteran channel?
By following the same logic as in step 1, you can create segments of Display-only, Social-only, and Social+Display channels. But now, instead of comparing the Display-only conversion rate to Display+Social, do the opposite and compare Display+Social vs. Social.
That’ll show you the increase in conversion rate from having a “warm introduction.” One extra step is to calculate the value of such an introduction. Unless you have a premium version of GA360, you can only see Display sessions – not impressions. So, calculating the cost of an introduction requires an extra step of looking at your cost-per-session out of Google Ads or a DSP of choice.
Most importantly, we usually add new channels to the mix to break through glass ceilings and diminishing returns. Proving the value of top-of-funnel media can be best done by showing the scale gain.
The math “exercise” above is also a budgeting exercise. An increase in “mutual conversion rate” results in improved ROI for each of the channels, first and foremost the “veteran” one – meaning you’re doing more with the same now – which in turn means the extra “saved” dollars can be spent on acquiring new users until you hit a diminishing return again, and need a 3rd (4th, 5th) channel to the mix. This exercise has helped me get CFO’s and others in the C-Suite on board. Basing your channel expansion plans on the numbers will help you as well.
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Diversifying your Media Mix with TV
In 2018, the gold standard was running lower-funnel direct response advertising with 6-second quick cuts - testing hook after hook, to see who would watch more than 3 seconds, and eventually click through to the LP and donate. At one point, we started running ads so well that we were getting a double digit click-through rate from Google campaigns to a very specific page.
Right then and there, we realized if we didn’t diversify our media mix we were going to end up completely fried. We were spending north of 6-figures per month on a single channel, with the second largest channel being about 20% of that. Keep in mind, we grew to 7-figures quick. It wasn’t planned to be spending that much. Immediately, we were asked by the executive team to figure out how to make TV work for us.
We knew from spending decent sums per month what worked - it was the Journey of a Dollar story. In fact, nothing came close to the way the journey story performed for us. Couple that with ads being whitelisted from the brands own social handles, and we were on fire. So, how could we do that with TV? I’ll tackle linear, CTV and OTT specifics in a different edition but for now, here are the critical pieces:
Concept & Story
Most TV commercials are pretty dull. They've got a generic story line, and they try to sell you the “solution” at the end of something they hope will have you hooked. The reality is that this worked 40 years ago.
We looked at what was doing well on every other channel, which was the journey story, and we decided to double down on that. It worked flawlessly (and continues to work).
Stepping outside of the non-profit world for a moment, this Hexclad ad is a perfect example of what a great TV ad looks like - entertaining from the first second. And when you get the advantage of TV viewers watching 15 seconds, versus on Meta trying to get past the first 3 seconds, it makes it much easier to convert.
Production
The actual production of TV ads used to be the barrier to entry to get a test going. If you look at the Hexclad ad it has high production values. But if you look at this MVMT ad, you can tell it was produced on a much tighter budget. The animations and renders help a lot to make the production appear more valuable, and the main filmed portions were produced with relatively low overhead.
The first TV commercial I was a part of cost about $100k in production costs. The third one was $10k all in. It really comes down to how well you architect the storyboard, where you have CGI (computer-generate imagery), and how good your editors are.
Media Buying
Leave it to the professionals. This isn’t something I recommend executing on internally and without the support of an agency. At this point you want to make sure that you have the rest of the funnel setup.
TV reminds me a lot of the native networks like Taboola or Outbrain. There are channels that will work well for you (like on Native, there are certain sites that do well for your brand) and there are those that won’t, and so obviously you shouldn’t spend extra dollars there.
Site Experience
The commercial and the placement of the commercial is one aspect. But you have to recognize the rest of the funnel as well - the website, the ask, the attribution, the donor support/customer service, what does the content look like for potential donors coming all hyped up from a commercial?
My preference is to air channel-specific versions or time-specific versions of the ads with unique codes linked to Asks (a content pillar eg Education) so you can see the attribution in real time. If you used nonprofit (dot) org / {keyword here}, then you can track the keyword back to a time when the ad aired, the landing page it went to, the bounce rate of that user, the conversion rate from that ad, and the donor cohort from a specific ad.
If you’re running TV traffic, you should focus on holding someone’s hand down the funnel to donate.
I’ve done something in the past where you’d go to the URL: nonprofit dot org slash TV and that URL would then redirect you based on the geo of your IP address. So if you entered that in Texas vs New York, you’d go to 2 different landing pages. In a specific brand’s context, you might do that if you have different Chapters or different events that donors would want to get information for.
In so doing we not only collected a ton of information on the traffic and which channel of airing worked best for us, but we captured more donors at the upper funnel level versus just catering to those who were going to donate right away.
TL;DR: As much as your commercial is important, you need to have a donor journey that viewers go through, to get to the other side of the donation.
Attribution
There’s no perfect way to look at TV attribution, but you have a few data sources to look at and understand what is and isn’t working:
• Publisher-direct data: This is feedback or data you get from the channel, if you buy direct.
• Attribution platforms: you can run proper media-mix modeling with TV ads and how that affects numbers on Meta or Google.
• Buying platform: If you run ads with a platform like Tatari or Vibe, you get a good amount of first-party data in there to look at and understand how ads drove traffic to your site.
• Using Google Analytics and surveys asking “how did you hear about us?” immediately after donation.
Attribution isn’t a perfect game, there will always be a small gap — but the data should be looked at as data for you to make a decision, not just the source of truth.
Running TV ads isn’t super simple. You have the ad tech, creative, attribution, multiple buying methods for streaming vs linear, and generally, most ad platforms aren’t optimized for performance marketing. There are a few platforms and agencies I’ve used who’ve really helped me learn across TV, using real-time data and feedback loops to optimize for the lowest CPA. I’ve benefited from seeking external support.
If you’re spending money on paid social and search, after a certain point, high CPMs and saturation lead to diminishing returns. That’s where TV’s ~$3 CPM gets really effective, especially when reaching new audiences that make your lower funnel tactics more efficient.
Interesting Reads This Week:
Don’t fall behind on brand: Getting results beyond performance.
Will AI replace digital marketers?
5 trends to watch in media and entertainment - EY
Hollywood wants you back in theaters, whether you want to or not.
Accelerating Nestle’s data driven digital transformation: accompanied with this YouTube vid.
Interesting Jobs & Opps
Blood Cancer UK: Digital Product Development Lead
Food Bank for New York City: Director, Social Media
Marie Curie: Head of Data Engineering
MISSIO, crowd funding platform of the Catholic world: Director, Digital Fundraising
The Metropolitan Museum of Art: Deputy Chief Development Officer for Individual Giving
USA for UNHCR: Chief Development Officer
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