How Impatience Hurts Long-term Marketing Growth and ROIThursday November 4th, 2021
Prioritizing short-term profitability over long-term marketing growth can stunt you. Instead, learn to slow down and optimize your whole marketing funnel.
Top-of-funnel awareness marketing improves bottom-of-funnel-conversion rates. You’ll find examples in this article that include:
- A B2B client that saw marketing-generated revenue increase by 42% and cost per acquisition drop 112% through brand awareness improvements
- A B2C client that saw a 39% increase in total conversions from top-of-funnel changes
- A B2C client that saw a 24% increase in social conversions from messaging improvements
In baseball, general managers who build strong farm systems that grow good players into great players have a correlated long-term impact on their franchises. Betting on overall value by looking at every aspect of a business is how Warren Buffet built his vast investment empire, too.
The lesson? Patient investors win over time. The immediate need to see positive results impedes the ability for great returns in the long term, whether we’re talking investing, baseball, or marketing. Prioritizing short-term profitability over long-term growth can stunt you.
At Brolik, we believe that anyone looking for immediate results should shift their time horizon out and focus on building a more sustainable growth engine instead of optimizing for a few percentage points in the near term. This approach is something we call “growth nurturing,” instead of the popularized term “growth hacking.”
In other words, stop spending all your time fighting for a quick and easy win in a single channel and start optimizing across your entire marketing funnel.
If you’re focused on the bottom of the funnel, the only tactics at your disposal are to convert more sales or drive down cost per click for highly competitive high intent searches on Google.
But if you move up the funnel, more tools are available. Leaning into awareness, trust, and credibility makes paid searches more effective, and developing educational content positions your offering so that a visiting audience is more aligned to buy.
An investment in the top-of-the-funnel also flows downward, making the complete funnel more healthy. The bottom-line: You won’t win more customers if you’re not also increasing reach and awareness.
But how do you measure ROI on awareness marketing?
As data-driven marketers, we understand the importance of the channels that are driving the highest quality leads, the revenue that campaigns are generating, and ultimately, the return on ad spend and ROI. However, part of a balanced funnel-based strategy is letting go of the need to see direct channel-specific correlation between spending and return, at least not right away.
When you invest in the top-of-funnel, your goal is increasing awareness and expanding your potential audience. Top-of-funnel content and ads may not show direct conversions and sales, but that’s not their primary purpose.
Looking at Brolik clients as examples, we regularly see the impact of investing in top-of-funnel efforts for balance. Companies thrive when they shift their obsession with incremental improvements to building a more sustainable marketing engine.
“Companies thrive when they shift their obsession with incremental improvements to building a more sustainable marketing engine.”
We took a look back at several early-stage companies and one more established small business. In each example, the company focused further out from their conversion points, at the awareness stage, or at the top of the funnel, and saw an overall lift on the performance of their marketing and advertising.
Example 1: Implementing organic awareness to drive results in B2B
Our strongest example is an early-stage B2B company operating in a highly competitive market. Paid search would normally be a go-to option from a quick-win marketing perspective, but well-funded competitors were pushing up the prices of search leads.
The best way to beat those competitors was a holistic organic strategy, instead of that bottom-of-funnel focus.
We paused our paid search campaigns, rebuilt the website to improve technical SEO results and honed in on content. A year later, because we made that investment in a long-term strategy, our cost per acquisition has dropped 112% and it improves each time we publish a piece of content. As a result, one out of every three organic searches generates a lead, and at the time of publishing, marketing-generated revenue has increased 42% compared to the preceding six months, and overall revenue grew 30% year-over-year.
Example 2: With a shift to digital, top-of-funnel optimization was critical for conversions
Another of our clients, a niche jewelry maker that is working to transition to an ecommerce strategy, is a great example of this process and approach. When we kicked off the engagement, we started by amplifying the company’s existing brick and mortar branding and messaging in advertising and were leading people to an outdated website. It didn’t move the needle on conversions. So, we invested in improving top-of-funnel brand messaging and rebuilt the website with a better user experience.
These changes increased our reach, widened the audience of potential customers, helped show positive traction around key ecommerce activities for high price-point items, and also elevated the brand’s credibility in the market.
Example 3: Targeting the right customers as early as the awareness stage
Another great example is a medium-sized company we’ve worked with since 2018, which provides services for homeowners. This long-standing client was already well-optimized across the entire funnel, but when it came to finding new efficiencies, instead of making incremental changes to bottom-of-funnel conversion rates, we invested in top-of-funnel brand awareness and messaging on social and search. Customer acquisition improved dramatically.
With search, we saw a 17% increase in traffic, but more importantly, we saw a 39% increase in conversions, proving that our awareness changes were bringing more of the right potential customers. Our data attributes that improvement to top-of-funnel search ad conversion and more direct traffic. On social, brand awareness and messaging improvements that introduced customers to the company drove a 24% increase in conversions while also decreasing the cost of acquisition by 66%.
While there may not be a direct and immediate impact on sales, focusing on awareness-based marketing tactics can drive a healthier flow of revenue in the long term.
We think it pays off to be patient. But it doesn’t have to be a mystery, either. There are plenty of metrics you can look at to gauge whether you are headed in the right direction.
For example, pay attention to branded search volume as you invest in awareness marketing. You should start to see a lift in potential customers searching for your branded terms. And you should start to see performance improvements at the middle- and bottom-of funnel, looking at metrics like cost per click and conversion rate.
And if you’re interested in hearing more details about how these strategies have worked for our clients, drop us a line, won’t you?