Someone clicks on your ad on Facebook and chooses to purchase the item for sale. We’d be in Utopia if that’s how 100% of user interactions would go. But as you might have guessed, such instant success is far from what happens in real life.
Early on, many startups are hyper-focused on the click-through rate (CTR) of their ads and the conversion rate (CVR) for purchases. This is good information, but it still leaves a lot to be desired.
Welcome to the misconception about the first point of contact:
A bit of history
A lot has changed since Google Ads (formerly AdWords) launched in 2000 with only 350 advertisers. According to Macquarie Research, by 2015 the number of advertisers, and therefore competition, had risen to 4 million.
A surefire way to increase conversion rates across all touchpoints is to diversify messaging.
Paid social channels like Facebook launched with only one primary ad format. Today we have dozens of formats. What does this do? It highlights the importance of being more creative in getting consumers to click on these ads.
This increased competition means startups have become laser-focused on beating the opposition at the first click. I firmly believe that great copy and creative can make or break paid acquisitions. However, it’s also too easy to get lost focusing only on the first point of contact. I’ve seen this happen many times with early stage startups.
The common user path
Instead of a user converting immediately after clicking or viewing an ad, the journey to purchase usually looks like this:
I’m always amazed at how much the second, third, fourth, etc., touchpoints are ignored in the analysis. I’d much rather have a fully fleshed out lifecycle than a CTR over 50%. Consider the example below:
Here, Startup A targets only the first touchpoint and Startup B targets all touchpoints. Although Startup B had half the total clicks, it saw a higher CVR due to retargeting and lifecycle emails, leading to a lower CAC.
Even in one or both scenarios, you won’t be maximizing your paid acquisition without retargeting, email marketing, and diversified messaging across every touchpoint.
How to tackle all touchpoints
Let’s take a look at some of the ways you can combat First Touchpoint Misconception. We’ll cover this topic through the lenses of retargeting, email marketing, and diversified messaging.
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Every startup should have an “always on” retargeting campaign. In 99% of cases, it will be more cost effective to recruit a retargeted user than a net new user. This can be a simple bet of 5% total paid acquisition for a retargeting campaign. If it proves fertile, it can also be very robust with recent nesting and different user segments. A simple recency and user segmented structure for an ecommerce store could be something like:
- Last 30 days visitors
- Last 30 days added to cart
- Last 90 days of visitors
- Last 90 days added to cart
With this structure, you want to exclude the audiences in each of the campaigns so that there is no overlap.
The beauty of this structure is that it allows you to spend more on retargeting buckets with higher propensity that perform best. Without segmentation, it is difficult to measure which target group performs best.
Email (and push) marketing
Many will argue that email marketing should only be enabled after you have acquired a predetermined number of customers. I believe that email marketing should be turned on right away. Why try to find a product-market fit without trying your best?
This is not to say that you should have nine fully fleshed out drip campaign series on day one. Far from. When a new lead comes in through a web or app campaign, take advantage of the emails you included with the signups as these users have shown some interest.
Here’s what a simple drip campaign setup might look like:
If a user signs up but doesn’t complete your conversion event, email them on Day One (D1), D3, and D7. Each email can have different themes, such as the inclusion of additional value props, social proof, or discounts. It also doesn’t hurt to ask for feedback on the latest post as to why they haven’t completed the funnel yet.
A surefire way to increase conversion rates across all touchpoints is to diversify messaging. The first message must be different from the second, and so on.
Start paying attention to how companies communicate when you interact with them. I can almost guarantee that you’ll see very educational sales posts early on, with more social proof in subsequent touchpoints.
Below are some advertisements from Headspace that rely heavily on the promotion of meditation: release stress and be happy.
In Headspace’s email communications, they insist more on discounts and how easy it is to get started (for example, that meditation can be done any time of the day).
I’m not saying you can’t have a discount code on your first and last point of contact. Instead, start thinking about diversified messaging and experiment with which styles resonate best at different stages.
Between the first ad serving, email/push sends, and retargeting, I highly recommend that all touchpoints have a slightly different flavor.
You don’t just think about the different touchpoints. There are countless resources that can help you gain valuable insights and knowledge. One of my favorites is the Facebook Ads Library, a repository of all of the platform’s ads that are currently live. Not only does this library provide you with information from competitors, but also valuable information about others in the same industry or brands who are simply running a great performance marketing program. Another goldmine is an email repository called Really Good Emails.
There are hundreds of other resources available, but I won’t list them all. Instead, I leave you with one question: how often do you, as a customer, buy something at the first point of contact?