Paid Advertising - Driver or Booster?
Keywords: Digital Marketing, Ad Campaigns, Social Media Advertising, Brand Managers, Content Marketing, Instagram, A/B Testing
With years of experience in the field of Digital Media and Online Campaigns, there is one particular term we love and that is Paid Social Media Advertising and no matter if you are a new digital marketer or a pro, you know that "Paid Ads" play a vital role in making sure that the Brand that you are nurturing and taking care of, reaches its niche market aka target audience.
But the biggest mistake we have seen that the Z-gen digital marketers do is not understanding the difference between using the Paid Ads as either the Driver or the Booster for the Brand. Now, coming to understanding these 2 concepts!
I am the "Driver"
The driver is when you are fully dependent on the power of your brand's money to reach more people, increase followers, increase website clicks, have more impressions, etc. Basically, you, as a "Marketing Professional" has decided that no matter what, your focus will be on achieving higher impressions and reach then giving your insights about actual Return on Investment (RoI).
The "Driver" concept works great, it makes you popular quick but this monetary popularity lasts until the Brand has funds. As soon as, Brand decides to make a stop on Paid Advertisements to cut costs, the Social Media Platform comes to a standstill. The reason is simple, you never thought of giving Content Marketing a chance! A chance that it deserves and rightfully so because Content Marketing uses a fraction of your campaign spending and help you create content that people want to engage with!
And, unlike what most Branding Managers and Digital Media Marketers have a notion, Content Marketing still requires Advertisement Campaigns but not as a "Driver" rather as a "Booster".
I "Boost" Performance
Booster or in simple terms, Fixed Period Advertisement Campaigns (FPACs) are targeted to promote based on a single entity. They are more focused on a single task and are better for your Niche Market or your Target Audience.
When you use Advertisement Campaigns as a "Booster" in conjugation with Content Marketing, you are more focused on creating content that defines your Brand, is Beautiful, and most of all are developed keeping in mind your Niche Market. This, in turn, reduces the reach, but that is offset by a huge Engagement Rate. Furthermore, since you are targeting a very focused market, the sales conversion is also better.
A/B Setup of Campaign
To test the theory we set a Hypothesis - "Instagram Account 1 (Driver) will have more sales for the same product as also being promoted in Instagram Account 2 (Booster)" and to test the hypothesis, we used 2 marketplace accounts with the following specifications:
Instagram Account 1 - Apparel/Clothing Resale Store in Delhi, ~ $7,000 Ad Campaign spending in 6 months, 6-month Engagement Rate is 7.19%, Number of Followers is 153K, and Contentigence Average Index is 3.52.
Instagram Account 2 - Apparel/Clothing Resale Store in Delhi, ~ $1500 Ad Campaign spending in 6 months, 6-month Engagement Rate is 15.82%, Number of Followers is 22K, and Contentigence Average Index is 6.88.
The parameters of both the Ad Campaigns are as follows:
Ad Campaign Amount - Rs. 5,000
Time Period of Campaign - 24 Hours
Target Location - Delhi, Gurugram, Noida, Ghaziabad, Chandigarh
Demographics - Sex: All, Age: 18-25, Interests: Fashion/Shoes/Style/Selfie
Estimated Reach - ~25K (IG Account 1)/~19K (IG Account 2)
Call to Action Button - Website (eCommerce) for Checkout
Contentigence Index - 3.18 (IG Account 1) and 8.14 (IG Account 2)
From the specifications and parameters, it is quite visible that IG Account 2 is on the losing side, it is possible while setting the Campaign that the Hypothesis may be true. Let's step back and remember that the idea to check here is the Sales.
A/B Testing Result of Campaign
Let's check the Number of Impressions of IG Account 1 and IG Account 2 compared to their Average Number of Impressions before the Campaign.
As can be seen, IG Account 1 (Driver) saw only about 1% change in the Number of Impressions while IG Account 2 (Booster) saw a whopping 300% jump in Engagement Rate but that does not necessarily mean that our Hypothesis is invalid just yet!
Let us see how was the Engagement in terms of Number of Clicks for both IG Account 1 and IG Account 2, Please note that we are not considering the Engagement Rate (in %) as Engagement Rate includes likes/comments/clicks. We will only consider the number of Call to Action Clicks to the eCommerce Website.
Interestingly, when compared to the Number of Impressions, the Number of Clicks for IG Account 1 was only 6.22% while for IG Account 2 were 16.58%. Here also, we see an upward trend but it all comes down to actually how many users actually brought the product and what was the Bounce Rate.
So IG Account 1 clearly shows a lower sales Conversion, where the Bounce Rate was almost 90% and for IG Account 2, the Bounce Rate was almost 79%. Now looking at the sales funnel for both the Accounts.
Looking at the complete Sales Funnel for both the accounts, we see that IG Account 2 was able to do the following:
Have more Impressions (14263 > 11118)
More Clicks on Call to Action Button (2365 > 692)
More Lead Conversions (512 > 70)
During the campaign, IG Account 1's total revenue was Rs. 152K while the total revenue for IG Account 2 was Rs. 1.26M which is almost 8 times.
The Cost per Click (CPC) for IG Account 1 was Rs. 7.23/Click while CPC for IG Account 2 was Rs. 2.11/Click. Furthermore, our Hypothesis was wrong, IG Account 2 (Booster) gave almost 8 times more sales. Average Sales Value was also higher at Rs. 2,466/Sale compared to Rs. 2,162/Sale for IG Account 2.
So as can be seen from the A/B Test, Booster Ad Campaigns have a lower reach but have a higher engagement rate, higher lead conversions, and higher sales when compared to Driver Ad Campaigns. But, it is important to note that Booster Ad Campaigns are highly dependent on using Ad Campaigns with Content Marketing.