There’s a lot that your media buyers can do for you in terms of optimizing your ads, your audiences, your ad types, and dialing in your bids. And those things can have a really big impact on your campaigns and revenue. But there’s one area of growth that is often overlooked and seldom taken on by media buyers: optimizing your offer.
Don’t underestimate the magnitude of impact offer-testing can have on your campaigns. If you’re not also testing and optimizing your offer economics, you’re leaving a lot of opportunity on the table.
Proven opportunities to enhance your offer
The core idea behind customer acquisition growth is simple: he or she who can afford the highest bid is going to acquire the most customers.
But the most important part of that question is: how do we get into a position where we can afford to bid the highest and remain profitable?
This is where offer optimization comes in.
Here are five proven ways you can enhance your offer:
- Price Testing: Test different introductory prices for your offer – this can mean decreasing prices but sometimes even increasing prices!
- Bonus Items: Test including a free gift with purchase to increase the perceived value.
- Payment Plans: Introduce payment plans to help mitigate hesitation around the initial buy-in.
- Increase Lifetime Value: Introduce new subscriptions or upsells that increase your lifetime value, allowing you to raise your CPA target and outbid your competitors.
- Landing Page CRO: Test new landing page headlines, find new and better calls to action, and implement different formats or designs – all of which have been proven to boost conversion rate.
Price testing and the addition of bonus items are some of the most immediately impactful offer optimizations that you can leverage. But, as you can see from the list, optimizing your offer doesn’t always require adding more tangible products (or lowering your price). Some optimization opportunities simply involve presenting information differently or making the transaction even easier.
All of these optimizations in the list above can offer meaningful opportunities to improve your customer’s overall interaction with your offer, from the moment they click your ad all the way through checkout.
Wondering how big of an impact these optimizations can have?
On one Client campaign, we tested reducing the introductory offer price from $20 to $10. With the price decrease, we saw the Cost-per-acquisition (CPA) drop by about $30. So when we did that, our revenue per customer went down by only $10, but the cost per acquisition dropped $30. That’s a $20 Net CPA reduction!
For another Client, we tested adding a free bonus item to their offer. The bonus item was inexpensive (less than $2 per unit), but when added to the offer it increased conversion rate by over 50% – that’s 50% more customers at an incremental cost of only $2 per customer!
Case Study: Optimizing a Mature Offer
There’s a lot of opportunity for offer testing in mature campaigns where you can build upon proven performance. With just a few simple offer optimizations, like in the case shown above, a nascent campaign can become the launch pad for your entire year (and beyond!).
This campaign had been running at around $250,000 per quarter, which is a fairly modest level of media spend. We worked with this client to identify two new opportunities for their offer: a new positioning angle for their landing page and a digital bonus item. (An extra benefit of these “free with purchase” bonus items is that they can often be digital or low-cost, so they don’t cost companies much, if anything. It’s a value-add for customers, but virtually free for the companies.)
We applied these optimizations (supplementary to our standard ad, audience, bidding, and budget optimizations), and over the course of a year, the campaign grew 4x — a great example of how relatively small offer tweaks can really magnify the impact of a campaign that otherwise seemed to have maxed out.
