Driving ROI and revenue in the new world order
If you sent a friend 100 texts and got one reply, would you be happy? The answer is no, but brands are settling for similar measurements on their advertising efforts.
When calculating the ROI on video advertising, if a consumer sees it for three seconds, it’s counted as a view. CRM campaigns are deemed a success if they have a 1% click through rate (CTR) — that’s not acceptable. There’s clearly an issue with the return on investment brands are getting from current advertising methods.
In a world where consumer touchpoints are numerous, but engagement is becoming increasingly difficult, a change is needed. Brands should want to talk to audiences using methods that produce human interaction, rather than snaffling three seconds of eyeball, or likes or clicks.
In fact, consumers are looking to brands to use new technologies like AI-powered chatbots and augmented reality to engage with them, according to a new report on customer loyalty released by Adobe.
The study, surveying 5,000 consumers across Europe — conducted by Goldsmiths University, shows that 38% of UK consumers, and 50% of those across Europe, agree they feel good about brands that continuously introduce innovation to improve the customer experience.
Commenting on the report, David Burnand — Adobe’s EMEA enterprise marketing director, said: “AI means brands can turn data and content into true, personalised experiences based on customer relationships — and at scale.” He adds that “AI will be critical to providing the personalised experiences that will keep consumers coming back”.
Be brave and switch to intelligent solutions
Businesses need to scale back on ineffective media spamming. Not only is this annoying and intrusive, the ROI is inefficient.
However, it takes confidence to shift spend away from ‘tried and tested’ methods that brand marketers are used to, and embrace newer technologies, such as chatbots and AI. But there are both short- and long-term benefits to making the leap to a more intelligent approach to audience engagement.
The short-term benefits of moving to a 1:1 conversational approach are revenue and efficiency. For example, one of our bot experiences produced a conversion to purchase rate of almost 30%, compared to the maximum 5% CTR a brand might expect from email campaigns.
Many brands are starting to explore this as a customer service solution. It drives efficiencies by automating simple, repetitive work and allows those staff members to focus on dealing with more complicated problems — adding value to the business.
While these short-term gains might convince brands to only trial these new technologies, providing this level of service and utility to consumers should not be seen as a one-off project. Instead, brands must focus on building value from long-term consumer engagement and loyalty.
Every time a brand interacts with a person through a bot experience, they’re learning about their audience, they’re getting live data. This builds a truer picture of a consumer, rather than clicks and likes or expensive consumer research that goes out of date sharpish. The constant feedback loop means that brands can act fast on the insights they gain about an audience. It could and should change the type of products made, pricing, distribution and marketing.
Used to its full effect, and long term, this strategy won’t require a traditional acquisition funnel, or a flawed customer journey — where brands start by bombarding people with communications to drive them to purchase. Instead, brands can focus their efforts and spend on becoming and remaining a useful service in people’s lives.
Get ahead of the competition
When a brand questions a shift in its industry, rather than act on it, it gets left behind. The time it spends doubting could be better spent getting ahead of the competition.
There was a point in time when brands quizzed the necessity for websites, and more recently the need for apps. But both have proved invaluable to brand awareness, interaction and providing customer service. The cycle of change is upon us again, from digital communication methods with poor ROI, to one-to-one relationships that offer a service.
Be clever about it — a messenger bot will work harder than a banner ad. When a brand invests in a banner they can expect to get a few clicks, if they’re lucky. Alternatively, if that brand directs people to a messenger bot, not only is that inventory cheaper, you get at least three engagements with that consumer at worst.
At best the bot continues to keep a dialogue open with the consumer over a long period of time. This helps brands learn more about the consumer, and informs them on how to better serve the consumer through marketing or product.
Facebook is even incentivising brands to step into this space. The Internet giant has a 24+1 rule when consumers interact with bots on Facebook Messenger. The bot has 24 hours to respond, but once that window is closed, brands can remarket to that person once without having to pay. Not only is this an immediate cost saving, it offers a better experience, where brands are having a conversation, rather than pushing people to a sale.
However, brands need to get started today to capitalise on these technologies. AI, chatbots and voice search still require human input to ensure they are focusing on the right consumer behaviours, and to ensure that the experience is rooted in how consumers naturally interact. For example, if a chatbot responds too quickly it creates the feeling that it’s not thinking about the question you have just asked, which can be off-putting. It also takes time to learn about the technology and understand how it fits into a long-term view.
AI, in particular, is not the shiny new solution all of advertising’s problems — yet. Learn and invest in its evolution now and the return on investment will be worth it — both long and short term. If brands put budget towards these technologies, it’ll pay dividends in the future — rather than being stuck in the technology, and the ROI, of now.