Marketing Operators Episode 034: How To Launch New Channels and Identify Incremental Value In Your Ad Spend

Release Date: November 19, 2024
Hosts: Connor Rolain, Connor MacDonald, Cody Plofker

Introduction

In Episode 034 of Marketing Operators, hosts Connor Rolain, Connor MacDonald, and Cody Plofker delve into the intricacies of launching new advertising channels and determining the incremental value of ad spend. Recorded on election night amidst fluctuating market conditions, the episode offers listeners valuable insights into navigating the dynamic landscape of digital marketing.

Election Night Analysis and Its Impact on Ad Performance

The episode kicks off with a discussion about the recent election and its unforeseen effects on advertising performance. Cody shares his initial optimism, which was later tempered by declining conversion rates and rising CPMs (Cost Per Mille).

• Cody Plofker reflects on his experience:

  “[02:29] ... I think I was probably a little arrogant and tweeting about it... Conversion rates went way down.”

• The hosts note a consistent increase in CPMs during October, correlating with pre-election activities:

  “[03:50] ... our year over year CPM bump is at an enhanced rate in October. Swing states are even higher.”

Cody attributes the downturn to underestimating the election’s impact, leading to a humbling experience:

“[03:47] ... I rode too close to the sun and got burned.”

They discuss data from No Commerce, highlighting consumer spending expectations during this period, which remains a bullish sign despite short-term challenges:

“[05:14] ... people are planning to spend more until pretty much right before Black Friday...”

Strategies for Launching New Advertising Channels

The core of the episode revolves around developing a playbook for launching new advertising channels. The hosts emphasize the importance of a structured approach, balancing risk and reward, and ensuring measurable outcomes.

• Cody Plofker outlines key considerations:

  “[21:56] ... risk versus reward. How much effort is this going to take versus how much impact is it going to have.”

• Connor Rolain highlights prioritizing channels based on consumer presence and creative readiness:

  “[39:42] ... one is, I just don't think there's a lot of digital channels that people have proven to scale...”

Key Steps Discussed:

1. Identify Customer Platforms:

   • Understanding where your audience spends their time is crucial. For example, launching on Meta and Instagram to capture new intents.

2. Assess Creative and Resource Readiness:

   • Ensure the team has the necessary creative assets and resources to manage the new channel effectively.

3. Set Clear Measurement Metrics:

   • Implement robust attribution tools to measure the incremental impact of the new channel. Cody emphasizes the use of comparative analytics:

     “[25:45] ... comparative analytics across channels and then really save our...”

4. Allocate Sufficient Budget:

   • Avoid the "middle ground" of insufficient spend by committing a meaningful budget that allows for clear performance evaluation:

     “[43:39] ... you want to kind of find the balance between minimum viable product but also doing enough where you are.”

5. Conduct Incrementality Tests:

   • Use tests like geo lift holdouts to validate the effectiveness of the new channel before fully scaling:

     “[26:48] ... we will run the holdout next which will be our like gold standard of truth.”

Case Studies and Real-World Applications

Jones Road’s Transition to Prussian AI:
Cody shares how Jones Road leveraged Prussian AI for their Media Mix Modeling (MMM), allowing them to quantify the impact of traditionally hard-to-measure channels like TV.

• Cody Plofker praises the tool:

  “[30:00] ... Prussian AI has been a game changer. Boiler Alert Test of the week is actually looking great. It’s actually looking like our most efficient channel thanks to Prussian AI.”

Hexclad’s Expansion into New Channels:
Connor discusses Hexclad’s strategic move into Linear TV and YouTube, emphasizing the need for a scalable and consistent advertising approach.

• Connor Rolain explains the selection:

  “[39:05] ... we have to be generating net new intent. That's what pushes us into okay, a meta and Instagram obviously.”

Optimizing Conversion Rates and Site Speed

In the "Test of the Week" segment, Connor highlights a successful experiment that underscores the importance of site speed in conversion optimization.

• Connor Rolain presents the findings:

  “[55:32] ... we saw a 14.8% bump in conversion rate during the test. A double-digit percentage increase just from having Edge Mesh rolled out on site.”

The discussion further explores how such optimizations can significantly impact overall business metrics by enabling more effective scaling of ad spend.

• Cody Plofker adds:

  “[61:55] ... you can go with the positive and say, hey, this allows for so much more volume.”

Balancing Measurement and Creative Excellence

The hosts emphasize the delicate balance between rigorous measurement and maintaining creative excellence. They caution against over-reliance on metrics while advocating for intuitive marketing strategies that sometimes defy stringent measurement.

• Cody Plofker remarks on the importance of creative strategies:

  “[47:03] ... being confident that's a revenue driving tactic for us. Even though I can't measure it, I'm not going to skip it.”

Looking Ahead: Future Channels and Strategies

As Q4 approaches, the hosts discuss upcoming initiatives and potential channels to explore in the new year.

• Connor Rolain outlines future plans:

  “[51:46] ... next year we're going to Applovin. We're going to do that.”

• They also plan to enhance partnerships and explore modern forms of collaboration, such as podcast advertising and influencer partnerships.

Conclusion

Episode 034 of Marketing Operators offers a comprehensive guide to launching new advertising channels, supported by real-world experiences and data-driven insights. The hosts underscore the importance of strategic planning, adequate budgeting, and robust measurement tools in successfully identifying and scaling incremental value in ad spend. As the marketing landscape continues to evolve, adapting these strategies will be crucial for sustaining growth and maximizing ROI.

Notable Quotes

• Cody Plofker at [02:29]:
  “I think I was probably a little arrogant and tweeting about it... Conversion rates went way down.”

• Connor Rolain at [39:42]:
  “... there’s not a lot of digital channels that people have proven to scale...”

• Cody Plofker at [55:32]:
  “We saw a 14.8% bump in conversion rate during the test. A double-digit percentage increase just from having Edge Mesh rolled out on site.”

• Cody Plofker at [61:55]:
  “You can go with the positive and say, hey, this allows for so much more volume.”

Key Takeaways

• Strategic Channel Launch: Prioritize channels based on where your audience is and ensure you have the resources to manage them effectively.

• Robust Measurement: Utilize tools like MMM and comparative analytics to assess the incremental value of new channels.

• Optimize Continuously: Focus on backend optimizations, such as site speed, which can have substantial impacts on conversion rates.

• Balance Metrics with Creativity: While data is essential, don’t let it overshadow the importance of creative marketing strategies that build brand value.

• Plan for Scale: Ensure that optimizations and channel launches are scalable, allowing for sustained growth and increased ROI.

For more insights and detailed strategies, listen to the full episode of Marketing Operators Episode 034.