Paying to play isn’t always playing to win. Clicks aren’t clients.
I have a metaphor that describes the phenomenon of “Pay Per Click” in simple terms. Let’s say you and I have a shoe store on Madison Avenue and 66th Street in Manhattan, NY. Prime retail destination. I place a man with a sign on the street promising $1.00 to everyone who enters the store. At the end of the day, you, my partner, call my cell and ask, “How was traffic today?” I respond, “Great, we had 1,000 people in the store – that’s $1,000 dollars.” You ask, “How many shoes did we sell?” I reply, “Two pairs, $400.”
That is Pay Per Click in action. Does the model generate high, quality leads? Who knows? Is it worth the money? Well, we know we had 1000 people in the store. But, how many of them bought shoes? If we had spent $2000 or $4000, would we have sold more shoes? If I have 20,000,000 page views on Facebook that I purchased so I can justify a higher CPM and the media buying entity can justify choosing my site over another based on this paid traffic, are these visitors valuable? Do they engage with what I have to offer?
Are these customers or are they just visitors?
Virtually every business category, particularly retail, has put their eggs in the digital marketing basket. The largest retail categories – automotive, cosmetics, media, real estate and hospitality – are all placing large bets and hoping to drive traffic, generate leads and/or positively affect their collective bottom line. The shift from marketing in traditional media channels to online has been a rapid, all-in reset focused on customer acquisition and retention objectives.
The rationale behind this shift is driven in part by cost: digital marketing is less expensive than traditional media. The second ingredient that serves to rationalize online marketing strategy is a desire to measure results. The classic lament in any traditional marketing spend was the lack of trackable results. Now, click-through rates, opt-ins, opt-outs and open rates provide marketers with a degree of measurement that many find comforting. Traffic, a customer experience with the brand, used to be the traditional media measurement tool. That traffic was ostensibly driven by a marketing message the customer experienced in one or more media channels that compelled that customer to take action. That action – walking into a retail environment or visiting an online destination – while hard to document, provided some degree of feedback, which, even if not directly attributed, delivered results that were “good enough.” If my store or site is busy I must be doing something right; in response to a marketing message, a potential customer showed up, tuned in or interacted with the product or service that hopefully led to the point in the relationship – a sale or some form of engagement.
The number of traditional media channels has always been relatively limited to experiential, print, radio and television outlets. The success of a campaign, defined by traffic, was a combination of messaging acuity and spend. Was it the right message in the right media channel for the appropriate return on investment? Those were and continue to be the invariably-asked questions when forming a customer acquisition or retention plan. The uncertainty of traditional media has been usurped by the “certainty” of digital marketing strategies. Measurement has replaced judgment and perhaps creativity. Traffic or online leads are now considered more valuable than engagement.
Consider the two primary forms of digital marketing available: Search Engine Optimization – or organic search – (SEO) and Search Engine Marketing (SEM) or Pay Per Click, (PPC). From an organic search perspective, a potential customer or user seeks knowledge and searches the web for that information. There are essentially two actors in this drama: the seeker and the repository of that knowledge, essentially Google, the largest search engine in the world. How that information is ranked, sorted, and stored – and thus made accessible – is driven by a set of algorithms (a process or set of rules followed in calculations and problem-solving operations utilized by a computer network). Organic search is predicated on the principle that the data has been sorted, stored and ranked based on its relevance or merits. Is it factually correct? Do other seekers validate that information? How frequently do others search for the same information? By this logic, the more seekers, the more valuable the information will be to others.
The second form of digital marketing, SEM or PPC, is based on the simple concept that the provider of the information can “boost” its ranking – and by extension its relevance – to a seeker by purchasing a ranking based on a set of criteria including words a seeker would use to search for content, data or information. A retailer, in this case, would identify keywords utilized in a search and attempt to “own” those words by buying them at an auction hosted by Google. The more the retailer is willing to spend, the more likely that retailer will appear in a seeker’s search. By boosting and buying keywords embedded in a landing page, ad or piece of content, the retailer is buying his or her ranking in Google Ad words. Pretty straight-forward: the more you spend, the more you show up, and, by extension, the more potential customers or leads you should attract. That’s the logic, anyway.
Let’s go back to our shoe store on Madison Avenue. Were we making the right decision when we decided the bulk of our marketing effort was going to be a metaphorical digital media marketing strategy – buying Google Ad words – to get customers to come to our store?
Having experienced both strategies at work, I would argue that the need to create a blend of marketing approaches is more vital than ever. We’ve added some new digital tools that have some nice touches, like measurement. Online marketing gives us the ability to speak directly to someone who has allowed us to access them, implicitly or explicitly, by providing their contact information. My question is whether or not this singular approach is an efficacious strategy. Does this approach eliminate the need to provide, engaging, content-rich experiences to acquire new and retain existing customers? I think not.
Like so many practices shaped by an explosively changing digital landscape, disrupted by what seems like a better, cheaper solution, one has to ask if solely relying on digital marketing is an effective solution to customer acquisition or retention, or have we just added another ingredient to our marketing pantry? Marketing is like artful cooking. It’s a process with a goal: to create a satisfying meal. That experience is measurable. Although the quality of the experience may vary by recipient, based on their expectations and prior experience, the results are quantifiable nonetheless. Would you consume the same meal day after day? Just as one type of food does not provide for all of one’s nutritive and taste needs, neither does one channel provide all the content or opportunities for engagement most consumers want or need. To extend the food metaphor, relying on digital marketing as the sole resource for outreach, growth, and sales is not unlike a chef using only one ingredient to prepare a meal. In evaluating the efficacy of any marketing tool in a diversified strategy, we must always consider that the goal is to provide a satisfying customer experience that results in engagement. For retailers, the most important form of engagement is, and will always be, a relationship embedded with the hallmarks of commitment and loyalty: purchase, preference, and recommendation.