Whether your focus is increasing sales or new customer acquisition, lowering your cost per acquisition (CPA) is key to long term success. In fact, one in five senior marketing officers surveyed said that lowering their CPA was one of their top priorities. It just makes sense as marketing departments are working with finite budgets.
The lower your CPA, the harder your budget can work for you. If you’re not sure where to start, begin with these three strategies.
Manage Your Media Better
The single highest line item in most marketing budgets is media investment. So the most important thing that you can do to improve your CPA is to manage how you plan and buy your media.
Let’s face it, you need to find the media channels your prospects are using if you want any chance of connecting with them. I know this sounds basic but this is a surprisingly common challenge. Only one in seven professionals say they can identify their audience members extremely well. You may also want to review your closest and most successful competitors to see where they invest in media. The marketers who understand their audience best do not rely solely on their own observations.
- Understand the Target
Refine audience targeting to ensure ads are shown to the most relevant potential customers. Use demographic, geographic, behavioral, and interest-based targeting. There are several tools you can use to help find where your ideal prospect spends their time online, such as Google Analytics and Facebook Pixel.
Some may use first and third-party data to get a better grasp on who is likely to do business with them. It is vital to understand when your audience is in-market. Nothing works better than putting ads directly in front of interested consumers who are actively looking for products or services like yours because you are reaching them at the point when they are most likely to convert.
Between a better understanding of who your prospects are and a better understanding of where they are in the decision-making process, you can make every media placement more effective.
Media Strategy Checklist
- Measure and Optimize
Implement robust tracking to accurately measure conversions and understand which campaigns, ads, and keywords are driving results.
Use attribution models to understand the customer journey and the impact of different touchpoints. This can help allocate budget more effectively and optimize underperforming channels.
Regularly analyze performance data to identify trends, opportunities, and areas for improvement. Adjust strategies based on insights gained from the data to continually refine and enhance campaigns.
Pay Closer Attention to Your Creative
No matter how much the media landscape changes, creative is still king. It’s not enough to be in the right place at the right time. You also need to grab your audience’s attention.
How can you tell what works? Testing. Try out different messages. Try different offers. Observe the effectiveness of design changes such as ad size, color and creative format. By A/B testing one factor after another, you will soon build a clearer picture as to what creative style and messaging works best.
Be Ready to Convert
To increase conversions today, it’s all about having a great user experience online (and offline).
Above all, make sure that every ad and web page are mobile-friendly. Nearly 60% of internet traffic originates from a mobile device, so your brand must be ready to interact with potential and existing customers.
When marketers don’t meet audiences where they are and proceed with an order in that environment, they lose conversions. We’ve known for years that a bad in-bound call center can absolutely kill valuable prospects and lose conversions. They can ruin a prospect’s potential of ever returning to your business.
We like to drive all our direct response ads to a dedicated landing page. The landing page should be well-designed. The content should be related to the ad or promotion that sent the prospect there in the first place, and the call to action needs to be clear. This helps reduce bounce rates and increases the likelihood of conversions.
Summing Up
Not every campaign is about driving a direct sale. But when your goal is lead generation and new customer acquisition, it’s important to get the assistance of someone who understands the process from beginning to end.
TEC Direct Media staffers have the skill, experience, and expertise to help. Helping identify and locate your in-market target audience through proper media planning, paying closer attention to creative and messaging, measuring results, and optimizing campaigns to meet your specific KPIs all help lower your CPA.
Check out this case study to learn how we helped our University client learn more about their core audience and acquisition costs. Ready to talk? Shoot us an email so we can drive down your customer acquisition cost and make your marketing dollars work harder for you.
What is CPA and why is it important?
CPA, or Cost Per Acquisition, refers to the cost associated with acquiring a new customer through marketing and advertising efforts. Lowering CPA is crucial because it allows marketing budgets to be more effective, enabling businesses to achieve greater results with the same or even less expenditure.
How can I optimize my ad campaigns to lower CPA?
To optimize ad campaigns, focus on refining audience targeting using demographic, geographic, behavioral, and interest-based data. Utilize tools to understand where your ideal prospects spend their time online. Additionally, analyze your competitors' media investments to identify effective channels.
Why is ad creative quality important, and how can I improve it?
Ad creative quality is vital because it captures the audience's attention and drives engagement. To improve ad creative, test different messages, offers, and design elements through A/B testing. Observing which variations perform best will help you determine the most effective creative style and messaging.
What role does data and analytics play in lowering CPA?
Data and analytics are essential for tracking conversions, understanding customer journeys, and measuring the performance of campaigns. Implement robust tracking systems, use attribution models to analyze the impact of different touchpoints, and regularly review performance data to identify trends and opportunities for optimization. This data-driven approach helps refine and enhance campaigns continuously.
