Daring Marketing — Let’s do the math on lovers, haters, and conversion rate
Bold messaging, pattern interruption, going after competition …We all want to try and experiment with more daring marketing content and copy. But is it worth it? And what’s the best way to optimize it. Let’s do the math!
I wrote about the types of risk-taking strategies here(What kind of risk-taker are you: Maximax, Minimin, or Minimax? A decision-making framework) but can we actually measure the impact of “edgy” marketing and how to limit the risk.
Let’s consider 2 marketing strategies:
- Strategy/Messaging M1: Very classic.
50% of people “kinda like it” (converting at 15%), 50 % are not responding very well (converting at 5%).
- Strategy/Messaging M2: Very edgy
25% of people love it, 75 % hate it. The love brings a conversion rate of 30%. The hate, 0%
Let’s look at 4 ways to handle it:
- I don’t want to take any risk and will only use Marketing M1
- I love risks and will only use Marketing M2
- I am going to A/B test these 2 strategies
- I am using AI/ML to do a smart distribution of content
TL;DR
Using an intelligent content optimization system wins, converting at 12%, followed by the no-risk strategy (10%), A/B testing (8.5%), and then risk only (7.5%)
Now let’s do the math!
1. No risk: All the visitors are exposed to Classic Marketing.
- 50 visitors kinda like it and convert at 15% ==> 7.5 conversions
- 50 visitors don’t respond very well and convert at 5% ==> 2.5 conversions
Results: 10 conversions, or a 10% Conversion Rate
2. All-In on edgy marketing
All my visitors are exposed to Marketing M2.
- 25 visitors love it and convert at 30% ==> 7.5 conversions
- 75 visitors hate it and convert at 0% ==> 0 conversions
Results: 7.5 conversions, or a 7.5% Conversion Rate
3. A/B testing
Let’s randomly serve Marketing A and B to 50 visitors
- Population A (50 visitors) is exposed to Marketing M1(classic)
25 visitors (50%) kinda like it and convert at 15% ==> 3.75 conversions
25 visitors (50%) don’t respond very well and convert at 5% ==> 1.25 conversions
Results: 5 conversions, or a 10% Conversion Rate
- Population B (50 visitors) is exposed to Marketing M2(edgy)
12 visitors (25%) love it and convert at 30% ==> 3.5conversions
38 visitors (75%)hate it and convert at 0% ==> 0 conversions
Results: 3.5 conversions, or a 7.5% Conversion Rate
Results: 8.5 conversions, or an 8.5% Conversion Rate
Even probably more important: We lost conversions on the test, ok…but now what? What’s the next step?
4. AI/ML approach
Now, let’s use a solution (like Cauzal AI) that is capable of serving the content based on what is most likely to convert.
It would be ideal to find the 25 edgy marketing lovers out of the population of 100 but that requires an AI model with 100% accuracy, which is not possible right now. So let’s say we capture 20 out of these 25 but still have 20 “haters” in the group.
- Population A (60 visitors) is exposed to Marketing M1(classic)
30 visitors (50%) kinda like it and convert at 15% ==> 4.5conversions
30 visitors (50%) don’t respond very well and convert at 5% ==> 1.5 conversions
Results: 6 conversions, or a 12% Conversion Rate
- Population B (40 visitors) is exposed to Marketing M2(edgy)
20 visitors love it and convert at 30% ==> 6 conversions
10 visitors hate it and convert at 0% ==> 0 conversions
Results: 6 conversions, or a 12% Conversion Rate
Results: 12 conversions, or a 12% Conversion Rate
