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By Gal Avidor, Account Manager

In this post we will demonstrate how a properly planned and funded test campaign can ultimately produce the desired results: lower eCPA, better reach of leads and new clients, and of course the major bottom line - higher ROI. 

For the past two years we have witnessed the emergence of many ventures looking to utilize results-based online advertising to drive potential customers to their website, and convert relevant traffic into sales dollars.   
 

Today, it is especially important for advertisers to maximize the utility of every dollar spent while casting a wide net in the vast online marketplace. Many advertisers have already invested a great deal of time and money developing a “designer” site platform and home page for incoming traffic, and are looking to test out the effectiveness of their designs before devoting a great deal of money to an advertising campaign.   In many cases, the size of the initial investment in the site creates a sense of urgency to quickly launch a test advertising campaign, with the hope that maximum performance can be achieved instantly on a small test budget. Our vast experience in this field has revealed that many advertisers make some common mistakes while developing online marketing plans for their websites, leading to a loss in efficiency and effectiveness, and costing more money in the long run to reach their goals. Here you will learn some of the essential elements of effectively testing an advertising campaign to maximize value over its lifetime. 

 A. Planning and Setting Objectives Set campaign objectives and define the value of your customer acquisition chain. Sample Objective: To achieve online sales while maintaining a daily sum of leads to support your calling center.  For this example, we get a mix of 3 options for a conversion process:  

1. Short qualifying process (for online sales).
2. Llong qualifying process (for enhanced lead quality).
3. Mix of short and long processes.

 Defining a clear objective and putting a true price tag on the value of each component within the acquisition chain enables you to measure and evaluate how performance at the beginning of the process affects the value of other components within the value chain.  You can follow the chain to the final conversion and beyond, even analyzing each component’s affect on up-sell opportunities.  This critical level of analysis will ultimately increase your ROI. 

B. The Optimal Landing Page Mix
In order to ensure achievement of your objectives, you will need at least 2-3 optimized landing pages which are properly designed and structured, giving the right incentives for viewers to click through your acquisition chain. 
Sample Objective: One of our clients was seeking to achieve an eCPA (effective cost per acquisition) of $250 from online sales of a financial product with 3 landing pages: 

1. Home page (not recommended)
2. A “call for action” page
3. Special incentive page

Testing these three, distinct landing pages gives us the ability to better understand the end user interaction and behavior in regards to our sales efforts. We can find out: Is the end user impulsive or is he more incentive driven?  Is he committed to enduring the whole conversion process or is he more comfortable with a short lead process, paving the way for an up-sell at a later date?   To summarize, the optimal landing page mix is an extremely important piece of information to maximize the reach of our conversion process, while enhancing our understanding of client behavior, and ultimately maximizing ROI. 

Landing Page Types – Pros and Cons: 

   C. Choosing a Test Budget:
Advertisers often commit a great deal of resources to building an online platform, but allocate minimal budgets to the testing phase, underestimating the capital needed to achieve a truly successful test that will translate to maximum ROI. The growing diversity of online traffic sources embodies many opportunities for advertisers to tap into new market opportunities, but it poses a great challenge of distinguishing between highly relevant, revenue-generating traffic sources and less relevant sources.  In order to calculate the ideal budget, one must take into account the different variables being tested during the campaign, these variables may include the CPA target goal, the number of creatives and Landing pages being tested and the number of traffic sources sampled during the learning process.It is important to point out that these variables differ from one advertiser to another, both in type and significance and depend much on the type of product or service being tested and the advertiser’s main and secondary objectives.These variables will dictate the size of the “Optimum budget” which is defined as the ideal budget to achieve a statistically viable conclusion to maximize ROI. To demonstrate how an Optimum budget can work for you, let's examine a real case study. 

D. Case Study 
Going back to our financial products example, where the advertiser was looking to achieve an eCPA of $250, he had created 3 landing pages and two creative sets totaling 10 creatives: CPA goal = $250Creatives tested = 10Landing pages tested = 3 Recommended test budget for the combination of number of variables and CPA goal is: $15,000With the test budget calculated the test campaign looks as follows: 

Phase 1: Preliminary AB testing The 3 landing pages were exposed to the same amount and mix of traffic in order to establish a general idea of potential for yield. This was done in order to plan the general distribution of traffic to be implemented during the actual testing phase. 

 Phase 2: Learning Phase (campaign) The test campaign was conducted for 4 weeks, constantly monitored and optimized. The results were as fallows: 

 From the test results we can conclude that although the test did not yield the desired eCPA of $250, and did not produce a high ROI, it did exhibit a number of positive key elements, allowing us to make meaningful changes before launching a full campaign. 

1. A positive trend in the number of new leads and new clients
2. A positive trend in leads\new client's ratio.
3. A decline in eCPA.
4. A relatively large number of leads fit for potential up-selling.

  These elements play a key role as you will see in the phase 3 – the optimized campaign:

 Phase 3: Optimized Campaign After the learning was complete, the number of high performing landing pages was narrowed down to 2 and the number of creatives was narrowed to the 5 highest performers. With the proper test exercised, and traffic sources carefully analyzed, the optimized campaign was launched with a 75K budget, with the following results: 

From this data, we can conclude the following: 

1. The number of leads and new clients increased dramatically.
2. So did the leads\new client's ratio.
3. The average basket value for new client decreased but in exchange for higher reach and higher volume.
4. The eCPA dropped drastically and registered below the client's initial goal.
5. The total revenue generated by new clients, when added to the revenue from the test campaign, yielded a higher ROI.

 When summarizing both the testing phase and the optimized phase, the full picture becomes clear: 

 To summarize, defining and carefully planning the different aspects of a results-based online advertising campaign are crucial to achieving maximum results in the long run.

 In this post we will discuss the major essentials in negotiation with advertiser in order to achieve most fruitful cooperation and maximize results.

Exhibiting at the Internet Convention in Israel last week, was a good opportunity to interact with the Israeli industry
and to introduce them with our comprehensive results-based approach to online advertising.
A closer look into our philosophy was provided by Peles in his workshop about pursuing results effectively and  some more on the central panel.
With the attendance of our DMG team at the event, results were clearly in sight.

Peles at the Panel: The Internet in Israel

At the booth: Inbar, Peles, Noam

Peles, DSNR and Shmil

At the booth No. 2: Inbar, Peles, Tom