Category Archives: Optimization

The Incremental Giveth… and Taketh Away

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De-averaging your marketing investments and paying close attention to how your incremental marketing investments pay off is a post I’ve been intending to write for a while now.

The good folks at Rimm-Kaufman group, however, saved me the trouble with yesterday’s excellent PPC Averages can Hide Incremental Nightmares.  Please take the time to read it.

As I was reading it, I started to think about applying LTV to the methodology.  When you think about making decisions based on LTV, the story becomes even more clear.  All will be revealed (with a graph!) after the break.

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Duran Duran, luck and marketing

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Simon LeBonAt one point during my college days I wanted to be an A&R guy for a record label.  My reactions to smoke-filled clubs and early-to-bed habits caused me to rethink that career option.

But music, and the marketing of it, has remained a lifelong interest.

Last night, my wife and I saw Duran Duran at Merriweather Post Pavilion in Columbia, MD.  This was her 11th or 12th time and my 10th time to see the band.

When you go to a Duran Duran show, you know you’re going to see a great performance, an enthusiastic crowd and hit after hit.

What I didn’t expect was a textbook example of creating and maximizing a marketing channel, and an example of how big a part luck plays in everything we do as marketers.

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Is LTV the first step in my marketing plan?

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istock-spreadsheet-compressed.jpgHow do you make money?

This is one of the first questions I ask all my clients. The answer usually comes back including some aspect of “buy low, sell high” and other margin-related facts. Regardless of the complexity or depth of the answer, one word is always included.

The magic word is “people.”

So why isn’t all marketing done on customer lifetime value (LTV)?  What are the five things you need to consider when developing LTV-based models that allow you to build CPA (cost per acquisition) based marketing plans?

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Is your website optimal? Can you tell?

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A client recently asked me “who can tell me if my website is working well for me?”  My immediate response was “your customers and your browsers.”  This, of course, triggered a conversation of how it was possible to talk to tens of thousands of (usually) anonymous visitors, collect their insights and then translate that to marketing improvements.

Prior to a large amount of advertising moving to the web, with the associated tracking and analytical capabilities, my response didn’t make a lot of sense.  Unless you were the sole proprietor of a local general store or had massive resources to undertake a large amount of expensive primary research, it was really hard to figure out what exactly about your marketing was working for your customers and prospects.

Until the rise of web analytics, that is. Continue reading →