Top 5 ways to maximize marketing budget profitability

Between all the recent restrictions, restrictions, write-downs, and new data privacy laws thrown at marketers, there have been plenty of complications that have collectively managed to cut down on the fun elements of growth marketing. These grievances are shared by growth teams in almost every industry, be it PLGs, B2Bs, DTC or even subscription brands. Despite volatile markets and limited budgets, growth teams are expected to deliver good results going forward.

This expectation, which stems mainly from investors expecting high returns on investments, creates a frustratingly paradoxical situation for growth teams. After all, customer acquisition costs are rising and expenses need to be managed – all while ensuring retention rates and rising profitability. It’s a big ask, especially with a tight marketing budget.

In an ideal world, implementing multiple growth loops would be enough to keep the engines running with minimal effort on the back end. In reality, growth teams need to be extra diligent in the approach they take to achieve optimal profitability for their marketing budgets.

Here are five tactics data-driven growth teams should consider to increase the impact of their campaigns.

Recent and upcoming regulations restrict advertisers’ ability to collect and process data for internal use. That’s especially detrimental, because robust data is needed to build, match, and expand audiences in future ad campaigns

This places huge importance on first-hand data, which is GDPR compliant by nature and crucial in today’s privacy environment. Based on this data, personalized experiences and advertisements can be delivered to customers and prospects.

Then there’s zero-party data like survey results, which allows brands to offer more personalization. Campaigns can be based on customer preferences. I particularly value third-party data because it gives brands the insights they need to evaluate customer lifetime value. This, in turn, can be used to acquire more customers of similar lifetime value.

The sky’s the limit when that data is combined with an artificial intelligence (AI) based predictive platform, which can use data-driven models to cast an even wider net in recruiting loyal users who are more likely to make purchases to do for the long term.

2. Reduce customer acquisition costs on a budget

Customer acquisition costs have risen significantly in recent years and there is no quick and easy way to directly reduce them, at least not yet. However, there are some workarounds that indirectly lower those costs while increasing profitability. These workarounds include attention to customer retention; introduction of a freemium option; and using internal data to fuel predictive marketing. These actions would collectively save a lot of budget for the growth and marketing teams, and the data extracted from them would enable teams to make more informed decisions.

3. If relevant and possible, consider always-on ads

For B2Bs, especially B2B SaaS companies, it’s crucial to rotate between ad campaigns. On that note, it is advisable for growth and marketing teams behind B2B SaaS companies to allocate a portion of the paid media budget to ads that are always on and work to drive future demand. This will help ensure that the company is shortlisted for potential targets when the time is right for decision makers.

4. Test newer channels

A good way to evaluate the capabilities of ad technology is to expand its reach beyond the usual channels by expanding to newer/less used channels like TikTok or Snapchat. These channels go way beyond dance challenges and cute animal content: they should be taken seriously by brands that can benefit from creating/sharing both educational and user-generated content.

For example, Canvas is notable for using TikTok to provide tutorials on how to use certain features, helping users get the most out of the platform. Brands also use TikTok to provide quick demos or teasers.

5. Stop making major marketing decisions and start futurespecting

I often say that “future perspective” is quickly becoming the standard in growth marketing, and this is largely due to growth teams realizing the importance of making smarter data-driven decisions to secure profitability. Major campaign decisions can no longer be made afterwards, as decisions are ultimately made based on proxy metrics and rules of thumb.

Futurespect, as the name implies, calls for decisions to be made in a future-proof manner based on future outcomes. The best way to do this is to put customer lifetime value data at the forefront and use it to get hyper-specific and accurate insights into metrics like predicted conversion rates and ROAS revenue.

Once armed with these insights, a wide variety of marketing decisions can be made; this may include, for example, bid adjustments and budget allocation. Predictive AI allows additional forward-looking campaign decisions to be made based on predictions that can look a few months or even a few years ahead.

Collectively, these insights will help teams get the most out of their marketing budget with better long-term results leading to increased profitability. Gone are the days of relying on intuition, luck and frivolous spending of marketing budgets. The only way up in the marketing industry is through efficiency, data-driven precision and out-of-the-box thinking, all of which are thankfully made possible with the help of AI-powered tools and technology.

Ido Wiesenberg is co-founder and CEO of Voyantis