Turn your marketing campaign into a profitable business

Any large-scale marketing campaign will inevitably require a large amount of marketing funds to support the brand's voice and increase traffic to sales channels.

The price of media purchases is getting more and more expensive. The price of an effective new consumer product is more than 100 yuan for a long time. The potential value of new customers and the brand exposure value brought by the marketing project cannot be realized during the project.

During major industry promotion periods such as 618 and Double 11, there is a fierce price war among competing products. In order to allow their own brands to occupy the market or to prevent their own positions from being taken away by others, brands have to reduce prices for promotions, and the profits of goods are squeezed to an extremely low level, or even forced to sell at a negative profit, which reduces the company's gross profit margin.

When marketing campaigns and e-commerce industry promotions collide and land at the same time, how can we break through and find profit points? Does it mean that big promotion projects can only bring long-term value, and there is no expectation of profit from the projects themselves?

Turn your marketing campaign into a profitable business

1. Find a balance point strategically so that the "increase in sales" * "relatively low gross profit margin" can still be greater than the increase in "marketing expenses".
2. When implementing it, look at it the other way around, and let the "increase in marketing expenses" and "reduction in gross profit margin" bring about the "increase in conversion rate" and "increase in traffic", which will increase the "increase in sales".

Find the balance point in strategy: infer the reasonable range through data statistics and adjust the balance point through goals.

Take the 411 anniversary celebration as an example:

1. Estimated sales increase

We usually estimate the highest and lowest values ​​by comparing the explosiveness coefficient of historical big promotions with normal sales, the effective user base, and the normal sales before the big promotion.

For example, I want to estimate the sales of the 411 promotion in 2019.

First, take the explosion degree of Double 11 in previous years as the highest value, and the explosion degree of Double 12 as the lowest value. Then, find the growth rate of the effective user plate between the two major promotions in previous years. For example, the effective user plate during 411 in 2018 expanded by 30% compared with the New Year Festival in 2018. Based on 411 in 2019, we can roughly estimate the size of the effective user plate for 618 in 2019.

Therefore, based on the "daily sales explosion coefficient and effective user increment coefficient before the 411 anniversary celebration in 2019", we can roughly estimate the approximate sales range of this promotion.

1. Gross profit margin is the biggest opportunity point

Gross profit margin is a relatively controllable value and also the biggest opportunity for profit.

We generally estimate gross profit expectations based on nominal gross profit margin and discount depth, and then make fine adjustments based on the sales structure of the goods.

The nominal gross profit margin is generally a stable value. If the discount depth is reduced, the gross profit margin will be increased. Therefore, before the big sale starts, we usually base the discount depth on previous big sales. Based on the competitive situation and your own inventory structure, formulate a site-wide discount depth and product recommendation strategy.

Adjust the product sales structure by adjusting the recommended products. For example, when high-gross-profit products are recommended, the gross profit margin becomes higher; otherwise, it becomes lower.

1. Marketing costs are also relatively easy to control

After the "increment in sales" and "gross profit margin" are roughly confirmed, it can be calculated how much marketing expenses can be spent to achieve a break-even point. If you find that your expenses are not enough to cover your income, you have to adjust your strategy and develop a profit model strategically.

Ensure that the strategy is effectively implemented during execution

After the strategy is developed, there will be several questions.

• Can spending money on marketing really bring about a corresponding explosion in traffic?
• Is the conversion effect of traffic brought by marketing expenses really as high as expected?
• Can a lower gross profit margin really lead to a corresponding increase in conversion rate?
• How to find the balance between gross profit and conversion?

1. Focus on marketing expenditures

When using marketing expenses, focus on effectiveness.

For example, advertising alliances use CPS and CPA to deliver results, while brand public relations use creativity as a fulcrum to leverage communication.

Mind communication should play the role of empowering the effectiveness of the campaign. If too much pure mind communication work is done during the campaign, the investment is likely to be in vain.

As for the effectiveness channel delivery work, through short and fast delivery tests, we can select the best delivery channels and delete inefficient channels. It is better to have insufficient funds than to waste them in vain.

After the channel is selected, the delivery strategy and traffic acquisition strategy are continuously optimized through AB testing. A high-quality delivery strategy is derived through growth testing, and this growth strategy is quickly rolled out to all delivery channels.

1. Controlling gross profit margin

Control the gross profit margin by controlling the discount depth and adjusting the product recommendation weight.

Take the anniversary celebration as an example:

Based on historical data, we find the balance between site-wide discount depth and conversion effect, and the balance between each product's discount and conversion effect, so that products can be discounted at the discount rate that contributes the most to gross profit. Then find some hook products and offer super low discounts to enhance the perception of event discounts.

In addition, by optimizing the traffic distribution strategy at the sales event, the recommendation weight of high-gross-profit contribution products can be increased as much as possible, so that the sales structure tends to favor high-gross-profit products.

1. Sales scene construction

Finally, the construction of sales scenarios can maximize the 1UV value (the comprehensive performance of conversion rate and average order value) to increase the user's average order value, conversion rate, repurchase rate, and even fission free traffic in the sales scenarios.

I believe that great execution is always the only way to success.

Author: Wang Aoda

WeChat public account: 9th floor, Area B, Dry Goods Shop