The Data Challenge: Scale Vs. Risk

Scale Vs RiskIf you’ve ever put together a digital advertising campaign, you’ll know that there are a lot of moving parts, to say the least. From prospecting to retargeting, and everything in between, it can demand a lot from a business. Much of the stress is rooted in the balance between scale and risk. Without enough budget, your ads can’t scale. On the flip side, higher spend equates to higher risk. So what is a marketer to do?

Here’s our take:

By The Numbers

It really is a fine line between scale and risk. Every marketer knows that without data, it’s hard to make an educated decision on the direction of a campaign. So let’s break it down. Let’s say we have $300 to run a LinkedIn ad towards three audiences. This splits the budget up to $100 a piece. Of course, we’d like to establish a funnel with our ads, playing off of the initial impressions and retargeting users who show promise as they go through the customer journey. That means the introduction of at least one new ad set for each audience. Now we’ve got $50 allocated per audience, per ad.

A Sobering Reality

As you can see from above, what initially looked like a strong budget of $300 has now been divided among so many ads and audiences that it will have trouble gaining traction. By the time someone gets through your funnel, you may have spent a considerable portion of your budget on just his or her own specific journey. It’s a sobering reality that we must understand in order to find a viable solution. What often may look good on paper could be a recipe for disaster when enacted online. Being a data-driven agency, we try to wait for at least 100 clicks before jumping to conclusions… and spreading yourself too thin may use up your budget before there’s even a dependable sample size to look at.

Teetering The Line

We’ve identified that budgets don’t look as hefty as they first seem when setting up an advertising campaign. We also came to the conclusion that without enough data, we can’t make an educated decision. So what now? Well, the biggest pain points are related to factors which divide our allocated spend. The quickest way to alleviate the pressure would be to address the divide. Try cutting out your other audiences, and focus instead on one for each month. If you’re still having trouble, simplifying your funnel to include one or two fewer ads can also help. The goal is to teeter that fine line between providing a customer journey and getting the total volume necessary for making an informed decision.



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KWSM is a digital marketing agency made up of journalists. We specialize in social media management, website design and video. Our offices are located in Orange County, CA and Atlanta, GA, but we serve clients all over the country. Read More