Why you should start ‘wasting’ money on marketing

Lucy Gotell is Digital Marketing Manager at MemberTracker

Lucy Gotell is Digital Marketing Manager at MemberTracker

MemberTracker’s digital marketing manager reflects on some early ad campaigns, and why it sometimes pays to throw money away.

Remember when you were a kid and you’d ask your parents for a couple of dollars, run to the corner store and spend it on candy? Typically, your purchases were pretty predictable. You’d buy a few tried-and-tested items that you loved (my faves were Laffy Taffy and those marshmallow strawberries, btw), savouring each one as you picked it from that tiny paper bag with sticky fingers.

Every once in awhile though, something new would catch your eye. Maybe a new kind of sour, or an ice cream bar that cost every cent you’d brought with you. Remember how disappointing it was when you handed over your hard-begged cash for something new and – uggh! – it tasted horrible. (Granted, there wasn’t much that my sweet tooth rejected, but when it did happen, it was a pretty crushing.)

This was my childhood self’s idea of heaven.

Fast forward to another week and another pocketful of change, and what happened? You bought the stuff you knew you’d like. You got maximum enjoyment (aka value) from that week’s purchase, because you’d experimented with something else, failed, and gone back to what you knew would work for you.

We carry these lessons with us into our adult lives, even into our roles as entrepreneurs and marketers of our business. There’s always the lure of some shiny new tool or method that makes us think, “maybe I could be doing better”. It takes time to find the marketing platforms – social media and otherwise – where your efforts will be most rewarded. And the only way forward is through the ‘candy test’: buy it, give it a taste, and either spit it out or buy more next week.

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Luckily, once we apply the above test several times, we start to see patterns: “Platform ‘A’ works for selling my intro class, while platform ‘B’ is better for selling existing members on membership renewal.” By experimenting with strategies that both work and that fail miserably, we actually put ourselves ahead as business owners, regardless of what we’re selling or to what audience.

Our first ‘candy test’

After launching the MemberTracker platform last year, our first priority was to get some initial trial sign-ups. We decided to run ad campaigns on both Facebook Advertising and Google AdWords, taking a different approach with each platform. Let’s look a little closer at each…

Google AdWords still seemed to represent some kind of gold standard in the digital advertising space, so we thought we’d better at least run a campaign for a few weeks here. Because it’s search-based, we ran ads that appealed to people searching for gym management software, attendance tracking or a mobile app for their gym. Our broad set of keywords included ‘fitness software’, ‘attendance tracker’ and ‘app for gym owners’, along with many others. Once they clicked on an ad, visitors were led to our 30-Day Free Trial page where they could sign up. So the campaign was fairly simple: Ad > Click > Trial.

In the meantime, we’d heard Facebook could yield amazing returns for small businesses, based on what we’d gleaned from several marketing podcasts and articles. Here, we took more of a content marketing approach, structuring our campaign around lead magnets like, ’16 Tactics to Boost Your CrossFit Gym’s Membership’. Once they opted into the lead magnet on our landing page, leads were placed into a follow-up email campaign. Starting with an introduction to MemberTracker, the emails led to more free content, then an eventual sales pitch for our Free Trial. So this campaign followed a slightly more complicated structure: Ad > Lead Magnet > Opt-In > Nurturing Email Campaign > Free Trial Upsell.

The results

As is often the case when you put yourself out there and try something new, the results were unexpected. Despite the fact that the AdWords campaign was much simpler and required fewer steps on the part of the prospective customer, it garnered less free trials for us than the Facebook campaigns did. We were able to build our email list by a couple hundred people through the ’16 Tactics’ eBook campaign (several of which resulted in a trial), whereas the AdWords campaign resulted in a total of two trial customers. And while we spent approximately $30 per trial customer with AdWords, the email subscribers we collected through Facebook cost about $3 each, while the trial customers cost about $20 each.

Looking back, there were a few reasons why Facebook out-performed AdWords. First of all, AdWords lends itself to the marketing of products and services that people are directly searching for, and likely need in the near future. Shoes, kitchen appliances or a gym membership are all examples of ‘need now’ items. A software is somewhat riskier, as it’s subscription based rather than a one-time purchase. Also, competition is pretty stiff for online gym management options, so our ads were competing against much bigger competitors who were likely putting down a bigger budget each day. Finally, in asking people to immediately start a free trial without knowing much about us, we were asking for a fairly large commitment.

Our Facebook campaign, on the other hand, posed less risk. In offering a low-commitment item like an eBook, we were more likely to grab people right away, then slowly introduce the main offering over time through a trusted tool – email. The eBook offer also worked well with Facebook’s ‘interruption marketing’ setup. That is, instead of appealing to users by trying to give them something they’re searching for (like in AdWords), we got creative and tried to tap into a business problem (‘not enough members’), providing a timely, easily-consumed solution.

The take-home message

As a result of our ‘candy test’, we scaled back our AdWords campaign, while investing more funds into Facebook Advertising. Now, as a fitness owner, you may find that AdWords actually works better for your gym, as your target audience might be actively searching for gyms or fitness classes in your area. Or maybe Facebook ads that directly promote a class is the way to go. The point is, we wouldn’t have guessed all of the above without actually trying things out. Sure, we ‘wasted’ a couple hundred bucks on ineffective ads, but we’ll never have to make the same error again. And by comparing what worked with what didn’t, we’ve been able to create further content and marketing funnels that we know have better odds of succeeding.

So study up on a couple of marketing channels, create a campaign for each with the same class or product in mind, and carefully track your results. And remember, surprise can be a very good thing!

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