Risks and Returns In ‘Pure Play’ Digital Marketing Strategies

Marketing strategies that rest on a single channel of customer acquisition have become much less popular over the last couple years. There are various reasons for this: the internet is becoming more of a settled business environment, there’s more competition on every conceivable channel, and service providers like Google and Facebook have taken to charging more money to businesses who are trying to reach customers using their services.

Whereas in 2010 or 2011, a company like Zynga was able to use viral recommendations to fuel rapid growth at a low cost, changes to platform rules across all services have made it so such strategies are no longer feasible for companies operating at any scale without a carefully considered strategy and well-executed tactics.

Anyone who relied on a pure play strategy over the last several years can tell you how they’ve had a major impact to their business from an update to the Facebook Newsfeed algorithm of a Google Search update like Panda or Penguin.

If you’re relying on a sole source for incoming traffic, here are some points for your consideration:

Knowing the risks

  • You’ll see an immediate drop-off in organic traffic or a spike in your cost per acquisition without warning. It can be as quick as one day to another.
  • You can have your company or a website that you own penalized by the service, with limited recourse available.
  • The service provider that you’re working with may not be capable of adapting to changes in the sole service you were using to generate traffic.
  • Your websites may need to be restructured significantly to handle changes that you can’t control.
  • All your revenue can be shut off without warning, leading to cash flow issues.

Understanding the potential returns

  • Using one service to drive traffic makes for a simpler overall marketing strategy.
  • It can be cheaper to manage up-front.
  • It requires less learning to remain current on.
  • It’s easier to find and hire experts in a sole marketing channel than it is to find generalists with high expertise in all the channels that they use.
  • It’s cheaper to optimize traffic coming in from a single source.
  • Requires less investment in alternate landing pages and customer on-boarding sequences.

Making better decisions about your marketing mix

In general, pure play strategies have more potential returns in the short run. They can also generate superior long-term results if and only if you speculate correctly about future policy changes in the marketing channel that you’re using.

For long term management of your marketing risks, it’s better to rely on a mixture of traffic sources appropriate to your campaign goals. Unless you have reliable moles working in all the major online platforms (which is a good idea), you have to hedge your bets. Comparing customer acquisition costs on different channels by running frequent tests will also help you to increase the effectiveness of your spending.

The larger the company, and the more significant the spending, the broader the mix that generally needs to be used.

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