Problem #1 – Risk & Reliance on a Single Traffic Source
Reliance on a single channel or traffic source poses many risks. These risks include:
- Account bans
- Ad disapprovals
- Resolution times
- Lagging performance
- Singular revenue stream
Diversifying marketing mix from a single channel approach to an omni-channel approach presents many opportunities. These opportunities include:
- Backup advertising channels
- Variable content standards
- Funnel stays live
- Move budget to other channels
- Multiple revenue streams
- Reliable channels
Problem #2 – Traffic Platform Capabilities are Limited
A strategic sales vulnerability is being limited to the capabilities of the single platform. Platforms have their own particular advantages like ad targeting, ad formats, placements, etc. and the goal is to engage with customers at multiple touchpoints along the customer journey. There is also a lot of audience fragmentation in terms of viewership around different platforms. Now it’s much more common to find audience that are dedicated or devoted to just TikTok, and others that favor or use Facebook on a daily and recurring basis.
When taking a multi-channel approach, the advantange is engaging with current customers across a number of different channels and also tapping into new and cold audiences.
Some of the major differentiators of ad platforms are :
Audience Targeting
- Diverse in-platform audiences
- High intent searches
- Creator content
- Contextual placements
- High intent audiences
Ad Formats
- Long form video
- Short form video
- Search ads
- Image ads
- Carousel ads
The key question to ask is what is the gap in the customer journey? After identifying gaps, then pinpoint the area to enhance in the marketing funnel and engage with the platform that can help fill the gap. For example, if the top of the marketing funnel is working efficiently, then one solution is to find high intent search traffic to convert bottom of the funnel buyers or visitors. Search ads and search arbitrage offer high intent and high quality buyers to help diversify the traffic mix.
Problem #3 – Revenue and Sales Performance Plateau
If you are susceptible to performance plateau such as audience fatigue, the solution is to add new channels for additional scale. Performance plateau is referred to as the law of diminishing returns and occurs when engaged audiences have been fully exhausted to the point where they are no longer providing a positive or cost-effective outcome.
Performance plateau also occurs when you’ve reached the point of audience saturation and have burned through the high intent and medium intent buyers, and now are at the stage of converting lower intent buyers, and paying a premium for poor quality traffic or visitors. This is common when running a niche offer or working in a specific industry and also within a specific geographic given that the audience is becoming naturally constrained.
Ultimately there are in-platform optimizations that can be done to prevent audience saturation. Also every market has a pool of total eligible buyers so there is a chance reaching the ceiling of buyers for a niche.
The benefit of adding new channels to the marketing mix is key to successful scaling.
Example Scenario:
Let’s say you are spending $150,000 per month on Meta at a 3.0x ROAS. This budget is targeting and acquiring high-intent and medium-intent buyers audiences, but over time, you will start paying a premium for anything above $150,000. You feel stuck. Roll out a new channel, such as google ads at a $7,000 ad budget, and there will be an automatic upward impact on the ad spend. As you start to scale out the channel, there will a positive topline revenue impact and increase purchase volume for scale.
Case Study: Real Estate Lead Generation
Key Success Metrics = CPL
Problem #1: 91% of traffic from Facebook with ad disapprovals, Facebook page bans, and low page quality score. target audience size is niche based
Solution #1: reduce reliance on Facebook by 34% by diversifying traffic mix to TikTok, Google Ads, YouTube Ads, Google Search and Bing Search
Problem #2: Customer journey was primarily driven by Facebook prospecting (High value look-alike audiences, broad audiences, and interest audiences) and Facebook retargeting (lead form abandoners, purchase abandoners)
Solution #2: YouTube (channel retargeting, keyword campaigns, branded campaigns, custom intent, site retargeting), Performance Max (in market audiences, GA audiences), and Google Search (branded search, RSAs)
Problem #3: Facebook scale limitations, increased Facebook costs, overall CPL, CAC and CPC increase
Solution #3: Increase in leads and purchases, decrease in Facebook CPL, CAC and CPC, decrease in overall CPL, CAC and CPC