Tommy Chang of Kreativa Group: 5 Ways To Manage Your Marketing Budget For Improved ROI

An Interview With Rachel Kline

Be ready to adapt and evolve on the fly. Business, as is life, is about evolution and adapting to ever changing circumstances and environments. We’ve pivoted our business a few times over the past few months already in response to market conditions and client needs.

With the growing complexity of marketing channels and the need for businesses to constantly adapt their strategies, managing marketing budgets effectively has become more critical than ever to ensure the highest possible return on investment. In this interview series, we are talking with marketing experts, industry professionals, and thought leaders who have significant experience in budget management and optimization, to share their “5 Ways To Manage Your Marketing Budget For Improved ROI.” As a part of this series, we had the pleasure of interviewing Tommy Chang.

Tommy Chang is the managing partner for Kreativa Group, a marketing and creative agency based in Los Angeles and Miami that focuses on growing brands exponentially through performance marketing and creative strategies. With over 20 years of experience, Tommy leverages his deep expertise in strategy, digital marketing, and performance-driven solutions to fuel the growth of startups to multi-billion dollar companies alike. Alongside his business partner, Kreativa Group is currently collaborating closely with their clients on producing creatively fueled and results driven strategies, designs, and marketing campaigns with a singular goal in mind — helping their clients grow and succeed.

Thank you so much for doing this with us! Before we dive in, our readers would love to “get to know you” a bit better. Can you share your personal backstory with us?

I was born in San Francisco, raised in Miami, studied at Tulane University, and now living the dream in Los Angeles. During college, I spent more time learning how to make websites than I did attending actual classes. After returning home from college, I worked for a catalog company named TigerDirect and created their first website. Within months of launch, sales generated from the website outpaced the entire catalog division. I transitioned into a marketing role, launched their digital marketing team, and continued to grow online sales to 100’s of millions of dollars. Eventually, I was recruited to Newegg where I oversaw the digital marketing team and helped grow sales by $1B. After Newegg, I went to work for Misfit Wearables, where I launched the ecommerce and digital marketing team, going from $0 to over $20M in revenue. I was fortunate to experience a successful exit as Misfit was acquired by Fossil Group for $260M. A few months ago, my now business partner, a creative genius and someone that I’ve worked with for the past 20 years, decided that our futures would be better served by working for ourselves, build an agency together, and create an environment where we’re thriving and doing our best work ever for us, our team, and our clients.

Can you share with us three strengths, skills, or characteristics that helped you to reach this place in your career? How can others actively build these areas within themselves?

Obsession. Being obsessed with and driven to achieve and go beyond the goals. Whether it’s growing sales by 500% YoY or improving ROAS by 25% MoM, I’ve always been obsessed with goals and achieving those goals for the organizations that I worked for and the clients that we partner with. Besides implementing a good strategy, and doing the actual work, I’ve built out various custom dashboards to monitor the data daily, weekly, monthly, quarterly.

Curiosity. From an early age, I’ve been curious about how things work, whether it be my Dad’s mechanical watch or Google’s machine learning bid algorithms. I like to tear things apart and understand how things work inside. Once I understand that, the rest is easy. I spend 30 minutes to an hour nightly reading, learning, and staying curious.

Emotional intelligence. Admittedly I wasn’t always as emphatic, self-aware, or kind, as I try to be now. It’s been a journey that began with realizing that I need to be better, improve myself, and how my words and actions impact others around me, especially those that I care for. Through this journey, I’ve discovered a renewed drive for positivity, personal growth, and a strong desire to give back to others.

I view life as a privilege. It’s a privilege to meet with my business partner daily and work with her to build our agency. It’s a privilege to do good work for our clients. It’s a privilege to be interviewed for Authority Magazine. This viewpoint allows me to stay focused, be positive, and do my best work.

I start my day with a brief meditation session, thinking about the goals for today. I end the day with spending a few minutes to reflect — what could I have done better today? What can I improve upon tomorrow?

Fantastic. Let’s now shift to the main part of our interview. What factors do you consider when allocating your marketing budget across different channels and tactics?

As Kreativa Group mostly focuses on direct response consumer campaigns, we consider these top three factors:

1 — Return on Ad Spend (ROAS). Which channels and campaigns are producing the best and worst ROAS? By being laser focused on this, we’ve been able to spend more efficiently, even less in some instances, while increasing revenue profitably.

2 — Scalability. Look at which channels and campaigns have the ability to scale effectively and efficiently through historical data. Find the point of diminishing returns, scale to that, and optimize the campaign to push beyond so you can continue to scale as efficiently as possible.

3 — Looking beyond the data. I don’t make a move unless the data tells me to. But sometimes, there’s more to the story than just the numbers. How does brand awareness and customer growth factor in? What other goals and factors are at play? Learn to adapt to changing goals. Sometimes it’s a quick sprint for growth at any cost, sometimes it’s trying to be as efficient as possible even at the expense of growth. Most of the time, it’s just growing efficiently. So, look at the data and at the full picture to know what levers to push and pull.

In your opinion, what are some common mistakes that marketers make when managing their budgets? How can they be avoided?

Marketers sometimes react too quickly to negative data on new campaigns, recent updates, or A/B tests. We’ve all been guilty of this, myself included. It’s balancing the pressures of hitting goals and testing. Avoid being knee jerky, allow for the newness or updates to settle in, then re-evaluate before making budget decisions.

Speaking of testing, always be testing. If you aren’t testing, you aren’t evolving and improving. We’re constantly ad testing, experimenting with new designs and landing pages, finding something that outperforms and out converts the previous version. Never settle for being good enough.

Sometimes brands are overly strict with their budgets or not strict enough. We’ve seen marketing teams receiving specific allocations of budget to each channel by the finance team, instead of collaborating and working together to find the best allocation that results in the best possible ROI. We’ve also seen other brands not having much of a budget plan and trying to figure things out as they go. In either case, both can lead to mediocre performance, underspending and leaving potential conversions on the table, or overspending and far exceeding the budgets.

We always advise our clients to have a balance. You need a plan that’s brought into by all parties involved and stakeholders plus the plan should have some flexibility built in for driving brand awareness and testing new concepts and ideas. We usually like to allocate 10% to 15% of the budget towards brand building campaigns in Google Ads for instance and 5% to 25% for testing new concepts and ideas.

When allocating your budget, how do you balance short-term marketing goals with long-term brand building initiatives?

Short term wins against the initial goals usually unlocks more flexibility for long term initiatives, like brand building, which we view as just as important as hitting those daily and weekly goals, if not more so for longevity.

We like to approach budget allocations that split off specific percentages of the budget for direct response acquisition, branding, and testing.

In seeking balance, it’s critical to understand proper attribution and approach marketing holistically instead of evaluating channels and campaigns in a vacuum. If your display ad campaign is not driving sales when viewing it from a last click perspective, how does it look when using data-driven attribution (DDA) instead? In 2023, it often takes the consumer several clicks between paid media and organic before deciding to make the purchase. Understanding how each campaign and channel plays a role in the entire clickstream is critical to understanding the makeup of your overall marketing strategy.

Lastly, with viewing marketing holistically, use a blended approach to calculate your ROI. Looking at your total blended ROI, that includes both paid media and organic channels, will often help you create the proper narrative to unlock commitments to more budgets and longer-term initiatives.

For start-ups and those with limited budgets, what tactics would you recommend to receive the highest return and the fastest initial growth?

With any organization, and especially with startups, any good marketing strategy and campaigns always starts with having a good product that consumers want or good product market fit. Without that, the best marketer in the world will fail, guaranteed. With it though, a good marketer will make your good product even better.

Assuming you have good product market fit, you’ll need to understand your users’ intentions. What are the user problems that they are trying to solve and how does your brand and product address it? Empathize with your users, position yourself as the expert guide, and provide them with your plan to help them succeed. Focus on your users, not yourself. Your users are the heroes of the story. This user centric method of storytelling is called the Story Brand framework and I highly recommend it.

Once you’ve figured out your users’ intent and have developed a content strategy, start with organic social media and blog posts to start building traffic and interest. Launch small Google Ads and Facebook Ads campaigns that are highly targeted to your target audience. In Google Ads, start with just exact match keywords and build out your first campaign using the Similar Intention Ad Group (SIAG) methodology.

One often missing and overlooked component is creative and landing pages. Is your website optimized for conversions? Do you have specific landing pages that focus on a single category or topic or are you simply landing all of your users to your homepage? Are you running A/B tests on your website and landing pages? In our experience, every word matters, even the color of your CTA buttons matter. What are you testing and how are you testing it?

Lastly, ask for user testimonials on social media and trusted review websites so they can be used on your website for social proofing and shared on your own social media channels.

How do you collaborate with other departments within your organization, such as sales or finance, to ensure alignment and maximize ROI from your marketing spend?

As an agency, we work closely with the brand’s marketing and creative teams, and in some cases, we are their marketing and creative teams, so we’re working closely with the founder.

With any relationship, communication and building trust is critical. Of course, we love when things are going great and we’re in the position to tout our great work and results daily, in weekly meetings, or QBR’s, although we prefer to over communicate with our clients, and we have weekly meetings to discuss status and updates. In those we share the good, and the bad. What were our successes in the past week, what were the accomplishments, what needs improvement, what can the client help with?

Depending on how things are structured on the client side, we either assist our counterparts with the right requests and narrative or we’re also meeting with other teams, such as the executive leadership team, finance, sales, IT, etc. to ensure alignment and maximum ROI.

What tips do you have to get buy-in from the CEO and others in the C-Suite when requesting additional budget for new projects or tactics?

At the end of the day, beyond the pretty presentations, CEO’s and other C-Suite executives are mostly interested in how much this new campaign will cost and how many new customers and sales it will generate.

Presentations should be concise, and include data that show projections on cost, traffic, customers, sales, and return on investment. Display and talk about the before and after, your exact plans for this new project or tactics for growth, and most importantly why it’s needed.

I recommend staying high level, avoiding diving deep into the details but enough that it contains the sufficient amount that it’ll answer most questions and will ultimately lead to an approval. Knowing your executive leadership team and learning to read the room is beneficial here. Some executives may only want to know the high level, some will want to dive in deep. Know your audience.

Which marketing software in your tech stack do you feel is most worth the investment?

Databox is an amazing analytics tool that tracks key performance indicators (KPIs) in a beautiful visual format. As a marketing and creative agency, we love it, and our clients love it as well.

I recommend a good project management system. We’re using Monday.com, which fits our needs to run both marketing and creative projects on. I’m also a big fan of Jira.

Here is our main question: Can you please share five things marketing leaders should do to improve the ROI of their marketing efforts?

1. Be ready to adapt and evolve on the fly. Business, as is life, is about evolution and adapting to ever changing circumstances and environments. We’ve pivoted our business a few times over the past few months already in response to market conditions and client needs.

2. Always be testing! You should be constantly testing something. At any given moment, we’re testing ad copy, creative, new campaign strategies, landing pages, even the colors of our CTA buttons. If you aren’t testing, you aren’t winning.

3. View marketing holistically. Marketing is much more than the sum of its parts. A user that begins their journey via Google Ads, may end up converting days, even weeks later via direct load. They were prompted to return to your website to purchase from an email they received a few days before. They signed up to receive emails from that Facebook retargeting campaign that you’re running after their first visit from Google Ads. The point is that you should be looking at the entire user journey and attribution cycle.

4. Avoid overreacting to negative data points. So, you’re running an A/B test and things aren’t looking good after the first few hours. Don’t panic, it’s OK. Avoid that instant knee jerk reaction and continue testing. If it ultimately fails, it’s still fine. At least, you’ve learned something that you can use going forward. You can’t succeed unless you fail first.

5. Be kind to your team and agency partners. We believe in kindness and prefer working with and collaborating with team members that have a high EQ. Teams who have high EQ members are almost always more successful in the long term, which translates into more sales and better ROI.

You are a person of great influence. If you could inspire a movement that would bring the most amount of good for the greatest number of people, what would that be? You never know what your idea can trigger.

We strive to make our world a much better place than how we found it through the power of positivity. Positivity breeds happiness and success. And laugh a lot. It’s contagious.

How can our readers best continue to follow your work online?

You can learn more about our boutique agency on our website at https://www.kreativagroup.com and follow me on LinkedIn at https://www.linkedin.com/in/tommychang16/.

Thank you for these fantastic insights. We greatly appreciate the time you spent on this.

Thank you very much for the opportunity!