Programmatic ad technologies have given media buyers a new “tool box” to reach customers in a compelling, cost-effective way. But many media buyers aren’t using these tools to their full potential. They limit themselves by allocating their ad spend exclusively on people just a few steps away from becoming customers. These media buyers could stretch their ad budgets, increase their average lifetime customer value, and ultimately grow their market share —if they’re willing to adopt a full funnel marketing strategy.
The Dangers of Not Working the Top of the Funnel
Most media buyers are aware of the “conversion funnel,” a useful analogy that describes the customer’s journey from brand awareness, to purchase intent, and finally conversion. Many have a tendency to focus their ad spends on people at the bottom of the conversion funnel. Targeting these people, who are actively in the market and looking for a solution, is potentially very lucrative. But the competition is cutthroat.
Why? Because these people have already shown clear signs that they’re almost ready to buy. It doesn’t take analytical superpowers to know that someone who types “Minneapolis MBA” into a search engine is more than just casually interested. Someone looking for a “Minneapolis MBA” has already decided 1) which graduate degree they want to pursue, and 2) where they want to do it. So it’s only natural for every business school in the area that’s advertising digitally to bid on those impressions. This skyrockets the cost to serve those highly coveted impressions. And there’s a lot of pressure to pick the perfect creative at the right place and time. If any of those factors are off, a competitor who delivers a better-optimized ad experience will win out.
Be the Influence
People at the bottom of the conversion funnel are easy to identify and close to making a buying decision. Targeting them remains an integral part of successful programmatic strategies. But focusing on these people exclusively overlooks an important truth: sales don’t happen in a vacuum. Let’s go back to our would-be business student. Even if they haven’t decided they want to pursue an MBA in Minneapolis yet, they could be exploring their options and open to influence. Targeting them earlier in the process sets you apart from practically everyone else.
Today, buying decisions are often complex processes. There can be a long period of information gathering before someone makes his or her way down the conversion funnel. Smart, targeted advertising can influence people when they’re at the top of the conversion funnel and coax them down. Something—or someone—is going to influence the customer at this stage of their purchase journey. Why not you?
The Solution: Working Every Part of the Funnel
The solution, then, is to embrace a full funnel marketing strategy that targets people at the top, middle, and bottom of the conversion funnel. Targeting the top of the conversion funnel positions you to be “top of mind” when your ideal customers start to get serious. Offering a preliminary brand experience early on leaves a memorable impression, especially when hardly any other advertisers are doing it.
The result? When those people start thinking about buying, you’re the first person that comes to mind. Your competitors, on the other hand, are strangers. But you’ve already forged a bond, setting the stage for brand loyalty and a healthy customer lifetime value.
Ads targeting the top of the funnel are also much less competitive than those targeting the bottom. It’s cheaper to serve more ads and build your influence. There’s less pressure to deliver the “perfect” ad experience because 1) each impression costs less, and 2) fewer competitors are in the game at that point. The end result: you use the same ad budget to reach more people and influence them throughout every stage of the buying journey.
Precision Targeting at the Top of the Funnel
Until a few years ago, targeting the top of the funnel was easier said than done. Some media buyers “sprayed and prayed,” distributing their ad spend far and wide. But it was hard to justify this hit and miss prospecting—especially without adequate data. New technologies have made targeting the top of the funnel not only possible, but also incredibly profitable.
The data to make strategic decisions is available, and the right people (and platforms) can help you put that data to use. Instead of limiting yourself to people who are already in-market, you can serve ads to those at the top of the funnel who fit your typical buyer profile. This can be done through a combination of audience targeting, contextual targeting, and lookalike profiles.
Guiding Prospects Through the Funnel, Every Step of the Way
Multiple touch point sales have become the norm in today’s online marketplace. Do you have a strategy in place to guide users along them? If you are used to focusing on the bottom of the funnel and immediate ROI, you want to be sure that higher funnel work will have an impact on your company. The key is looking into what we call “system wide” measurement structure. Here at Katana, we have developed a proprietary approach to tangibly measure the impact of higher funnel impressions. If you want to try yourself, we recommend thinking about all of the elements that are being touched by higher funnel interactions and develop KPI’s around them.
Targeting every part of the conversion funnel with a full funnel marketing strategy maximizes your ROI and sets you apart from competitors who try to swoop in at the last possible second. You can use data to find the right people early—and stay with them every step of the way. Instead of being “just another business” that waits to win them over until they’re ready to buy, you could be a brand they already know and trust. The choice is yours.