List, Offer, Creative – The Best Way to Optimize BOTH Digital and Direct Mail Retargeting

Retargeting offers the opportunity for your brand to achieve the Holy Grail of modern marketing:
“Reaching out to the right person, with the right message, at the right time.”

What other tool in your marketing magic bag can enable you to reach out to a recent anonymous website visitor, with a relevant message and offer, right after they visited your site?

Retargeting can help you create a fantastic brand experience that consumers ARE paying attention to these days – which also makes them open to paying more for your products if they love your brand.

With the future of your customer relationships and profitability on the line, you want to get your retargeting right – so you must optimize your retargeting campaigns.

But with up to 30 retargeting factors that you can potentially optimize, what do you prioritize?

The beautiful thing about optimizing retargeting campaigns is that the priorities are the same for BOTH your digital retargeting and Direct Mail Retargeting channels.

The best retargeting optimization advice is for you to follow this simple acronym – L.O.C.

That stands for List, Offer, Creative.

It’s an amazingly powerful acronym because not only does L.O.C. focus you on the 20% of retargeting optimization factors that will get you 80% of your improvement and lift, but it also communicates the order of importance for each factor…

…so you know which optimizations to do, and in what order. It’s very actionable.

More on that very soon.

We’re going to focus our comments on optimizing Direct Mail Retargeting since it’s our bread and butter – and the area where we get the most questions. But all the L.O.C. optimization guidance is 100% applicable to digital retargeting as well.

Optimizing your retargeting is such an important part of our system for high-return Direct Mail Retargeting that it’s Fundamental #5 of the five pillars in our Modern iO Direct Mail Retargeting program.

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So let’s see how the List, Offer, Creative framework can help you optimize your retargeting campaigns the right way – so they have the relevance and power to convince hesitant visitors to give your brand another chance.

List, Offer, Creative – The Best Way to Optimize Direct Mail Retargeting Campaigns

As we enter into the world of conversions and optimization, let’s not get ahead of ourselves.

You first need to ensure you’re measuring all the conversions your program is delivering. If you aren’t, your conversion and ROI analysis is going to be off, and you may be making adjustments to campaigns that are already working well.

MEASURE TWICE, OPTIMIZE ONCE

What do we mean that you may be missing conversions?

For ecommerce clients with a single channel and/or sales funnel that does have a Conversion URL, your conversions are indeed being well tracked and measured. Your key response and conversion metrics are available in most any dashboard (including our Direct Mail Retargeting dashboard) for you to evaluate – and determine which campaigns may not be meeting your ROI/ROAS goals.

Those are the ones you optimize first.

But it can be tricky if your funnel doesn’t end in a “Thank You” page or other Conversion URL to directly track your results within a Direct Mail Retargeting program. From our experience, this includes nearly half of all SMBs running DMR programs, so it’s an issue that impacts many businesses.

MATCHBACK TO BE SURE

To get the most accurate ROAS in those situations, perform an offline Matchback Analysis at 45 and 90 days. You simply compare your list of recently converted customers to the list of website visitors who received your Direct Mail Retargeting mailer over the same period.

The Matchback Analysis will identify which of the Direct Mail Retargeting recipients became converted buyers – to give you a clear view of the conversions your Direct Mail Retargeting program is actually generating. It’s a powerful tool that should be employed in the second and fourth month after your program’s launch to get multiple readings as your campaign’s conversion rate mature – an analysis we do for clients at no charge.

PROMO CODES

One other important alert for brands whose funnel doesn’t end in a Conversion URL is for businesses that have recognized that gap in their conversion tracking – and sought to fill it by using Promo Codes.

It’s generally a smart move – but unfortunately you CANNOT rely upon counting the redeemed Promo Codes to get the true number of conversions your Direct Mail Retargeting program is generating.

That’s because 43% of buyers forget to redeem coupons at checkout. But no worries, a Matchback Analysis can capture those customer conversions so you can know your true performance.

The impact on campaign ROI after a Matchback Analysis can be substantial. A client of ours with a women’s apparel business was confused and concerned about the level of conversions in their program based on the low Promo Code usage. They could tell orders were trending up overall, but didn’t see a parallel increase in Promo Code redemptions.

We performed the Matchback Analysis for them and – no surprise, no surprise – over half of their newly acquired customers did receive a Direct Mail Retargeting mailer just prior to purchase, but didn’t use the Promo Code during checkout.

The analysis revealed the client’s actual ROAS for their first Direct Mail Retargeting campaign was a very healthy 8x return. Of course, they kept that campaign running AND increased the budget… and now it’s been generating a substantial ROAS for almost three years.

Now that you’re aware of these two potential pitfalls of conversion measurement, let’s get into retargeting optimization using the List, Offer, Creative framework.

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“L” IS FOR LIST

It’s time to show you how to optimize your List, which by itself will make the biggest impact on the amount of return website visitors and conversions generated by your Direct Mail Retargeting.

Think about it… you can have an irresistible Offer and engaging Creative with spot-on messaging, but if you present it to a List of uninformed newcomers just starting their customer journey who have a different problem than what your product solves… they just won’t buy.

The biggest mistake marketers make with their List is that they don’t set up retargeting rules that segment their List into meaningful website visitor groups – ones that will make their task of converting members of each group easier.

All visitors in a group are sent the same Retargeting Postcard with the same Offer and Creative, so all group members must share qualities that can be leveraged to move them forward toward conversion.

Many marketers instead opt for convenience and merge visitors into just a few general groups and end up sending “general” Retargeting Postcards that don’t convert well – because they’re either too vague to engage and motivate the visitor to return to your site to buy, or not relevant to the visitor’s goals.

ALL THE WORLD IS A STAGE

The most useful framework we know to effectively segment your List into meaningful groups is the “Stages of Awareness.” It’s the foundation of Fundamental #3 (“Segment and Target Your Mailings”) in our Modern iO Direct Mail Retargeting program.

This classic segmentation framework has five distinct “stages” – that perfectly lay out the visitor groups that you to utilize to segment your website visitor List.

Think of the Stages of Awareness like a sales funnel. Each Stage represents a buyer awareness level and is separated from the next by a psychological barrier. Your job as the seller is to bridge the barrier with your offers, messaging and content to move your prospect forward — or no sale happens.

It’s founded on the principle that you can’t make a prospect buy before they feel ready. It’s human nature to progress through the Stages – and not skip any.

We’re only going to focus in the List step on what the Stages are, and who fits into which Stage. We’ll be able to provide specific recommendations on what to offer and say to them in the Offer and Creative steps – where we’ll have the foundation for it to all make sense.

THE CLICKS ARE THE CLUES

You can figure out what Stage of Awareness each visitor is at based on which and how many pages they’ve visited on your site:

• If your website visitor only visited the Category page and not any Product Pages, then they’re likely Solution Aware. They are looking for top-level information on the solution, how it works, assessing if that can solve their problem, and maybe even comparing the solution to others. They usually aren’t close enough to purchase, so they don’t want to get bogged down in product details yet.
• If your website visitor went to at least one Product page, and maybe checked out the About page, then they’re Product Aware. This visitor is almost ready to be sold and is nearing purchase, so let them know why you’re the best by expanding on the benefits that prove it. They stopped short of putting anything in their Cart, so they are moving close to Most Aware but likely not there yet.
• If the website visitor went to a Product page (often several, with prices), maybe the On Sale page, and put at least one product in his Cart and then abandoned it, he’s Most Aware – he’s ready to buy and is likely looking for a deal, and/or checking out the Shipping options.

These are the rules to set up in your Direct Mail Retargeting program to segment each unconverted website visitor in groups that can be more easily converted.

With the List optimization completed, we can now move onto the second most important retargeting optimization factor.

“O” IS FOR OFFER

In the Offer optimization step, you’re about to see how to expand on the List step and use the visitor’s Stage of Awareness to determine the best types of Offers to make to them… Offers that can best move your unconverted website visitor groups forward and convert.

To clarify, the Offer in the L.O.C. framework is simply what you’re offering to each segmented website visitor group you created in the List step above – i.e., what they get if they take action from your Retargeting Postcard. It could be a BOGO or discount, an e-book, an event invitation… anything of value to your List members is in play.

EVERYONE IS NOT YOUR CUSTOMER

The biggest mistake that brands make with their Offer is that they treat all unconverted visitors as if they’re in just one group – the “ready to BUY” group…

…and therefore make only “purchase Offers” of product or service discounts, BOGOs and bonuses.

That leads to lower responses and conversions because, in reality, only the Most Aware group is “ready to buy” – which includes just 10% of prospects.

Treating all visitors as one big “ready to buy” group also leads to misinterpretation about the attractiveness of your product or service and the discount or bonus Offer – which causes you needless tests of even more new purchase Offers.

AN OFFER THEY CAN’T RESIST

The 10% that are “ready to buy” can be easily retargeted focusing on the recommendations for the Most Aware group – that can all be very strongly driven by a BUY-BUY-BUY message.

The other 90% of unconverted visitors are just looking for a partner to help them move through the Stages of Awareness so they may be ready to buy at some point.

Below follows clear guidance on how to choose the right Offer for each Stage of Awareness group* (i.e., your groups from the List step). We’re skipping the Unaware and Problem Aware groups because they aren’t close to conversion, and generally require more time than they’re worth pursuing.

• Group Story
• The prospects know the solution they want, they just don’t know your service exists or that you provide it.
• The prospects are in the advice-gathering stage, so educate them with benefit-focused advice so they can validate their need to buy. It’s NOT time for a hard sell.
• Offer
• Buyer’s Guides
• FAQs
• Blog Posts, Videos, Lead Magnets
• Podcasts

• Group Story
• The prospects know what you sell, but they aren’t sure it’s right for them.
• They’re in the comparison stage, trying to figure out their best option – so prove you (or your products) CAN do what you say you can.
• Offer
• Case Studies, Testimonials
• Free Trials, Product Demos & Tutorials
• Product Reviews, Brand Videos

• Group Story
• The prospects already know who you are, what you sell, and that it solves a problem they have. They’re just looking for a reason to buy from you.
• Incentivize prospects to take action, keep them up-to-date on all products and services so they can find the right opportunity to seal the deal with your brand.
• Offer
• Discounts, Deals, Upsells
• Time-Sensitive Offers
• Product & Price Sheets

To put the Offer framework into practice, let’s say you run a regional running shoes and apparel store. You’ve optimized your List as in step one above and segmented your unconverted visitors into the Stage of Awareness groups.

Based on internal research of visitor behavior on your site, you know you have visitors that dive right into a Product page on your site for Shoe A, check it out for a while, then proceed to navigate to Shoes B and C – but then leave, without putting any of the Shoes into their Cart.

You smartly decide that this behavior defines a Product Aware unconverted visitor on your List. You realize that they are comparing the shoes to figure out which is their best option. You determine it doesn’t make sense for this Product Aware group to get up a “Buy Now” Retargeting Postcard for 25% Off – but instead see they need more help comparing options to make their best decision.

The Retargeting Postcard instead features both a link to the Shoe Comparison page, plus to a Running Shoes resources page that has links to “reviews editions” that Runner’s World and PodiumRunner have published. You’re proving your business’ value to your Product Aware visitors, way more than by just flashing a 25% Off coupon. You have executed your Offer optimization very well.

“C” IS FOR CREATIVE

Last, I’m going to reveal how to optimize the last element after the List and Offer – the Creative – which in the L.O.C. framework means the design and messaging.

The biggest mistake that brands make on the Creative for Direct Mail Retargeting is to use the digital retargeting Creative from a similar product or campaign and simply expand it to the size of the Retargeting Postcard.

Since the Retargeting Postcards are several times larger than the average digital retargeting ad, this creates a sparse and underpowered Creative execution that tends to significantly underperform.

Follow the creative process for Direct Mail Retargeting – which is different than any other channel, including regular Direct Mail.

Remember these prospects have already visited your site, so focus on getting them to take action – this is NOT just a branding touch. Tell your story, highlight why you’re different (and better), and give them an offer they can’t refuse. Remember, you’re acquiring a new customer here.

Some brands have little experience in Direct Mail, so we offer these DO’S and DON’TS of Direct Mail design and messaging to help make the Creative optimization task as easy as possible:

DO’S

• Follow your standard brand guidelines so prospects recognize your outreach
• Match your website’s design and messaging elements so there’s a consistent experience
• Use BOTH sides of the Retargeting Postcard to tell your brand story and communicate your Offer
• Maintain the proper Stage of Awareness elements to have a holistic and more effective design
• Stand out in the mailbox – your Retargeting Postcard first needs to be seen to be effective!

DON’TS

• Bury your message with clever words or pretty pictures
• Choose being clever over being clear
• Forget to speak to the emotions of our visitor and their aspirations to meet their goals
• Convert a digital retargeting ad into a Retargeting Postcard
• Forgot to use a Call-To-Action!

No L.O.C. optimization step would be complete without its guidance from our trusty Stages of Awareness.

You want to align your Direct Mail Retargeting design and messaging with what visitors from each Stage ARE ready for so your outreach is as relevant as possible – and moves the visitor forward toward a possible conversion, even if they’re not ready to buy just yet:

• UNAWARE – Highlight a problem that everyone has that your products fix
• PROBLEM AWARE – Mirror their pain to meet them where they are, then guide them
• SOLUTION AWARE – Highlight the benefits that favor your solution
• PRODUCT AWARE – Sell! Expand on the benefits and compare why you’re the best
• MOST AWARE – Deal time… make them an offer they can’t resist

It’s amazingly powerful because not only does L.O.C. focus you on the 20% of retargeting optimization factors that will get you 80% of your improvement and lift, you know which optimizations to do, and in what order.

And by following the List, Offer, Creative framework, hopefully your Direct Mail Retargeting program the opportunity for your brand does achieve the Holy Grail of modern marketing:
“Reaching out to the right person, with the right message, at the right time.”

DOWNLOAD the Direct Mail Statistics eBook

*Fluxe Digital Marketing