Unleashing the Power of Paid Media Management: Strategies for Maximum ROI

In the highly competitive digital landscape, maximizing return on investment (ROI) is a top priority for marketers. Effective paid media management is a key component of achieving this goal. Whether running ads on Google, Meta, or programmatically, there are key principles to keep in mind.

Understanding why you are not your ROAS (return on ad spend)

When it comes to measuring success of ads, it’s easy to look at return on ad spend (ROAS). Spend $1, and get back $3. Therefore, the ROI is a 3x and we can move ahead with that as either a success or a failure.

However, in many cases it is not that simple. Different businesses have different ways of defining marketing success for their company. High-end automotive ads might have a 90-day+ conversion cycle for leads. If that’s the case, looking at ROAS in a smaller window would give a disparate view on what the true value back from paid ads.

Similarly, other brands can afford to run their front-end acquisition in the negative (i.e., spend more than is returned on the first purchase) because their clientele or customers have a high lifetime value (LTV) and they’ll become profitable over a longer time horizon of several purchases or months of a subscription.

Ultimately, paid media will be run most efficiently when goals and KPIs are set based on the individual business’s needs, goals, and acceptable margins. A one-size-fits-all approach to reporting will make some campaigns look amazing, and others abysmal.

Isolating and testing key variables

The job of a good media buyer is to place ads that’ll return the highest ROI possible, regardless of the objective (awareness, sales, etc.).

In order to do this, there needs to be extensive testing of multiple variables, such as the creative, the messaging, ad placement, platform, and then all of these contextualized against the stage of prospect that’s being advertised to.

A testimonial ad will perform differently to someone already familiar with the brand than someone who has never heard of it.

To create effective tests, identify the key variable to test and pivot around that; for example, test new creatives with the same copy (if applicable), placements, etc. in order to ascertain what variables drive the needle the most. This will also help uncover how much warm-up the prospect needs before converting. Some move through an awareness journey over the course of months while some brands spend 95%+ of their spend at top of funnel, or to cold traffic, because that’s where most of the conversions happen.

When beginning paid media, focus on the core principles to define where more minute tests need to happen later. Discover when people convert from cold, how long they need to be retargeted for, and what type of creative generally have the greatest impact at which stage of the buyer journey. All other tests will cost less and tell more moving forward.

Understanding and deploying 1P data groups to support bidding

Regardless of whether or not a brand has run paid media before, there’s been a lot of activity like site traffic, previous purchasers, leads, and other segments. Since this data has been earned, it’s best to utilize it to the most we can to generate the greatest returns from acquisition efforts moving forward.

With the rise of machine learning, algorithms, and artificial intelligence, it’s becoming easier and more effective in many ways to train ad platforms in a unique user profile to target and optimize for. Meta has lookalikes, Google has audience signals, etc.

The question becomes how to utilize the 1P data that has been garnered most effectively. Generally speaking, splitting high-value 1P groups (e.g., buyers, multi-buyers, high-AOV buyers, etc.) from lower value ones (e.g., site visitors) is a good way to create cold audiences that’ll share characteristics of differently valued customer groups.

This allows for bids to be positioned accordingly, traffic measured, and ultimately the efficacy of paid media against different profiles to be tested. All of these abilities come from existing 1P data.

Putting it all together

By implementing these strategies and continuously monitoring and optimizing paid media campaigns, one can maximize ROI and achieve increasingly impressive results. Remember, paid media management is a dynamic process that requires constant attention and adaptation—stay proactive, embrace experimentation, and keep refining strategies to drive optimal performance and growth.

Do you want to learn more about paid media contextualized for your brand or needs? Reach out to our team here—we’d love to hear from you.