Advertising effectiveness: How to pre-evaluate and improve a campaign

There are many ways to reduce advertising costs: changing the traffic source, improving creative materials, optimizing landing pages, and much more. However, another effective method is a preliminary assessment of the effectiveness of the advertising mix. This allows you to significantly reduce the costs of test campaigns.

In this article, we will take a closer look at how to check the effectiveness of an advertising link and which aspects are especially important when analyzing the results of A/B tests. After all, conducting tests is an integral part of a successful advertising strategy.

Bundle effectiveness

To evaluate a combination, webmasters usually launch small test campaigns, based on which they then optimize advertising campaigns. This method is considered one of the most effective. However, it is possible to evaluate the effectiveness of campaigns in advance, even before launching advertising campaigns. While these predictions may not be accurate, they can still help reduce A/B testing costs.

To preliminary assess the effectiveness of the link, arbitrage traders need to collect several blocks of data.

Competitor analysis

To optimize an advertising campaign, it is important to study what creatives other affiliates use, as well as which channels and advertising formats are the most popular. This will help not only understand the level of competition, but also identify the most profitable deals, find creative ideas, and so on.

It is recommended to enter data on competitors in a separate table, which will contain the following blocks:

Traffic Sources: Indicate which platforms and channels competitors use to attract audiences. This could be social networks, search advertising, affiliate programs and others.

Calls to action (CTAs): Determine what calls to action your competitors are using. These could be buttons that say “Buy Now”, “Learn More”, “Register” and so on. Evaluate their effectiveness and attractiveness to the target audience.

Quality of Audience Segmentation: Assess how well competitors segment their audiences. This may include age, gender, interests, geographic location and other demographic and behavioral parameters.

Estimated rates and advertising budget: Try to find out the approximate rates per click or impression and the total advertising budget of competitors. This will help you understand what resources are needed for a competitive campaign.

By collecting and organizing this data, you can gain a deeper understanding of the market and find opportunities to improve your advertising campaigns. By analyzing traffic sources, you can choose the most effective channels for your advertising campaigns. Evaluating your calls to action will help you create more engaging and effective creatives. Analyzing the quality of audience segmentation will help you target advertising more accurately, and information about competitors’ bids and budgets will allow you to optimally allocate your resources.

Audience Crossover Assessment

Determine how much your audience overlaps with your competitors' audiences. Perhaps you are promoting the same offer, but targeting completely different audience segments.

If the overlap between the target audience is minimal, you will have to evaluate the advertising mix differently, and simply copying someone else’s approach will not work. It's important to understand that what works great with one audience may not work well with another. Therefore, the second step when analyzing competitors is to check the overlap of audiences.

Carrying out such an analysis will help you understand:

Differences and similarities in preferences: Study what aspects attract competitors’ audiences and how much they coincide with the interests of your target audience. This will help you adjust your creatives and targeting approaches.

Targeting Accuracy: Evaluate how accurately competitors segment their audiences and how this compares to your methods. By identifying points of intersection and difference, you can improve your own targeting strategy.

Tailoring Approaches: By understanding what's working for your competitors and how it can be tailored for your audience, you can create more effective promotional materials and campaigns.

The following methods can be used to check audience overlap:

Social Media Analysis: Study followers and engagement with competitor content on social media.

Analytics Tools: Use tools like SimilarWeb or Alexa to compare the audiences of your and competing sites.

Feedback: Conduct surveys and collect feedback from current customers to understand their preferences and compare them with competitors' audiences.

By collecting this data, you'll get a clear picture of how your audiences overlap with your competitors' audiences and what advertising approaches will be most effective for each of them.

Audience segmentation and focus group creation

To give a more accurate assessment of the advertising mix, you will still have to launch test advertising campaigns. However, before doing this, it is better to first segment the target audience according to demographic, behavioral, psychographic and other characteristics. Segmented audiences can be gathered into focus groups, for which test campaigns will be created and launched.

This approach has several advantages:

Create more targeted creatives: By segmenting your audience, you can develop creatives that better meet the needs and interests of each specific group. This increases the likelihood that the ad will be received positively and lead to conversion.

Reduce A/B testing costs: Testing on clearly segmented groups allows you to quickly determine which creatives and approaches work best. This helps reduce the cost of running a large number of tests.

Increasing the number of leads during the testing phase: By directing traffic to narrow audience segments, you increase the likelihood of receiving leads even during the testing phase. This allows you to more accurately assess the effectiveness of the advertising mix and quickly achieve the desired results.

The following criteria can be used to segment the target audience:

Demographic characteristics: Age, gender, education, marital status, income.

Behavioral signs: Purchase history, frequency of interaction with the product, level of loyalty.

Psychographic traits: Personal characteristics, values, lifestyle, interests and hobbies.

Geographical features: Location, climate, population density.

After segmenting your audience, create focus groups and develop relevant creatives for them. Running test campaigns on these groups will allow you to collect data on which advertising elements are most effective for each group. Based on this data, you can optimize your advertising campaigns and achieve maximum efficiency with minimal costs.

CTR forecasts

For a more accurate assessment of the advertising mix and effective budget planning, it is important to conduct research and collect data on CTR (Click-Through Rate) for similar campaigns. This is another way to analyze competitors, but on a larger scale. Some affiliate marketers also provide CPM (Cost Per Thousand Impressions) and CPC (Cost Per Click) forecasts, which help calculate estimated CPM and cost per click based on an extensive database.

To make such predictions, several steps must be followed:

Collection of data on campaigns and links

First, you need to collect data from various sources, including your own previous campaigns, open sources and specialized analytics platforms (for example, SimilarWeb, SEMrush, SpyFu). It is important to segment data by type of campaign (search advertising, social networks, display advertising), industry, geographic location, demographic and behavioral characteristics of the audience.

Segmentation of data according to the required parameters

Divide the collected data according to the following criteria:

Types of advertising campaigns: Search advertising, social networks, banner advertising, etc.
Geography: Regions and countries where campaigns were carried out.
Demographics: Age, gender, income level, education.
Psychography: Interests, values, lifestyle.
Behavioral factors: Purchase history, frequency of interaction with advertising.

Analysis and forecasting

After segmenting the data, you can proceed to analysis:

CTR Predictions: Calculate the average CTR for similar campaigns and compare it to your current CTR to understand how your creatives and targeting are performing.
CPM Forecasts: Determine the average cost per thousand impressions for each campaign category. This will help you understand which channels and advertising formats are most cost-effective.
CPC forecasts: Calculate the average cost per click for various segments and compare with your current costs.

Mapping data to your campaigns and connections

Use the collected and analyzed data to optimize your campaigns. This includes reallocating budgets to channels and formats that perform best in CPM and CPC, adjusting creatives based on average CTR data for your industry and campaign type, and setting more precise targeting based on demographic, geographic and psychographic data.

Conducting such an analysis will allow you to more effectively plan and conduct advertising campaigns, increasing their profitability and minimizing unnecessary costs.

Modeling

Let's present a modeling problem to an artificial intelligence like GPT chat. Let the task be to predict the results of an advertising campaign and provide recommendations for improving creatives. It is important to note that the forecasts will be estimates, but they will help predict the expected results from the campaign.

Adding constructs with the phrase “what if” will allow you to model different scenarios of user interaction with advertising, which will also be useful for campaign planning and optimization.

Classic link evaluation metrics

Classic marketing metrics play an important role in assessing the effectiveness of advertising campaigns. Here's how each helps analyze and predict campaign results:

Conversion Rate (CR):

This is a key metric that reflects the percentage of users who completed a target action (conversion), for example, purchasing a product or subscribing to a service, relative to the total number of visitors to the site or landing page. The higher the CR, the more effective the campaign is in attracting and persuading the target audience.

Customer Lifetime Value (CLV):

This metric shows the total income that a company can expect from one client over the entire period of cooperation with him. It is calculated as the product of the average revenue per client per period and the average number of interaction periods. Measuring CLV helps you optimize your marketing and customer retention strategies.

Return on Investment (ROI):

ROI measures the effectiveness of an advertising investment by showing the relationship between the profit received from that investment and the cost of it. This indicator allows you to evaluate how much a campaign generates income compared to the costs of its implementation.

These metrics are important not only for assessing the current performance of campaigns, but also for predicting the results of future marketing and advertising initiatives. The use of artificial intelligence, such as ChatGPT, can greatly simplify the analysis and forecasting process, providing more accurate and granular recommendations for improving marketing strategies and optimizing campaigns.