Two business travellers meet in an airport lounge. One says to the other: “Can you recommend a post-GDPR expert?” Her companion thinks for a moment and says: “Yes.” “Great,” she says, “can you give me their details?” “No,” says her friend.
So how are you coping? Can you, like The Guardian’s columnist John Crace, fail to see a clearer inbox yet?
For online businesses who generate new business leads online in two ways, both will be affected by GDPR in the coming months:
- Via affiliates, brokers, email and third-party databases;
- Use of direct marketing such as PPC, SEO and paid social media.
Opt-in under GDPR has made the first more complex and risky.
The second group generate their own leads and get first-party opt-in, so are less affected by GDPR, but their use will become more competitive as a result of the effect of GDPR on the first group. PPC can make up a shortfall but is priced based on competitive bidding. This will push up the cost-per-click (CPCs) for everyone. Here are three strategies for dealing with disruption:
Conversion Rate Optimisation (CRO)
Businesses often prioritise website traffic over conversion, despite the evidence of a higher return on investment from CRO. If you increase your conversion rate you can pay more for your visitors.
For example: A website converts 1% of traffic to sales, and the cost-per-acquisition (CPA) is £100 with a CPC at £1.00. If the CPC were to increase to £2.00, the CPA would go up to £200. To bring this back down to £100 CPA, you need to increase the conversion rate of the website to 2%. If the conversion rate is increased even further, to say 4%, CPA drops to £50 even at the higher CPC of £2.00, and the volume of sales quadruples.
The 80/20 rule
Historically, sales are credited to the channel the customer most recently interacted with prior to purchase. This ignores factors such as the first time a customer hears about a company or visits the website, which may have played an important part in the sale. If a business uses full attribution modelling, the credit is assigned more accurately to multiple channels, better informing their traffic and CRO decisions.
How do you prioritise effort and budget to optimise? According to the Pareto principle, 80% of effort drives 20% of results. What marketers often forget is that you can step this up. So, the top 20% of the top 20% (4%) will bring 64% of revenue. Ultimately, optimisation is about prioritisation. With more competition you need to optimise the journey for your most valuable customers. Amazon does this beautifully with its ‘one click’ ordering and Amazon Prime.
Advancing remarketing and thought leadership
Remarketing is low-cost and high impact, particularly useful post-GDPR when email lists are likely to be smaller (see previous article predicting this in May 2017). One of the big mistakes people make with remarketing is to stick with the default Google setting (30 days). This can be increased to 540 days. If you do this and deliver valuable thought leadership content that’s interesting and useful to target audiences (using banner ads, YouTube videos, sponsored LinkedIn, Facebook or Twitter posts) you will become ingrained in their minds as thought leaders.
All three strategies together are a powerful combination for ROI and will offset any disruption to sales from GDPR or future algorithmic changes.
We’ve a GDPR Data Processing Flowchart available for businesses. If you’d like a copy, please request.