Click-to & 1-800 Direct Response Radio
The Basics of Direct Response Radio / Part VII
Searchers v Impulse Buyers.
Given a choice of calling an 1-800 number to buy something sight unseen or examining it at their leisure on-line, many people prefer...both! If you do give your own prospects both options, make sure your website greases the path from initial impact to check-out!
Your web site is your ad, your store, your warehouse manager, even Your Thing Itself. Most Impulse Shoppers want to get in and out fast.
Think! Not
!
Your code guys may grumble, but you should continuously tweak and test different ways to grease the path from initial impact to check-out. Usability Tests are cheaper than buying tons of clicks, only to lose most eyeballs in the first 5 milliseconds or most shoppers in a maze of clever XML.Is your home page loaded with Sacred Cow links, buttons, and blinky-banners? Don't advertise it. Instead, send media shoppers to a slicker Hi-C page with an easy to spell URL.
This seventh and last page in the series is fairly dense, but if you can chug through it you'll know just about everything you'll need to know about Click-to Direct Response radio.
The Good News is that Impulse Shoppers tend to convert to buyers at two to three times the rate of KeyWord Searchers. Radio prospects are more interested in your solution than in some string of words that just popped into their heads. They also tend to be moderately more literate, and willing, therefore to read...just a little. (Half the adults in the USA cannot read a newspaper. It makes you wonder why KeyWord Content is King.)
The Bad News is that if IBM Surfaid or Doubleclick DART report that you now convert less than 2% of PPC clicks to sales, you probably should not load up on media clicks. The inexorable workings of GM/C will eat your budget alive.
Conversion is King.
Dot-Com advertisers pay attention to PPC costs and SEOPs fees, but they routinely settle for an abysmally low conversion of visitors to customers. A Google KW click may cost $.11. A radio Impulse click may cost $1.00 to $4.00. Pay attention to CONVERSION. It's the most powerful number in the GM/C=X formula.
If you opened a Cafe, 1,000 prospects walked in, 25 looked at your menu and only 15 sat down to eat, would you blame the radio? Why settle for 1.5% conversion on your website?
Here are the results of a typical network radio Click-to buy. G is a solid 1.535, M is only $2.89. Look how MCPS drops with each 1% increase in Conversion:
I recommend you SLICKIFY the path from home or landing page to shopping cart to check-out before you advertise. Get PPC and organic C up to 4% and you'll likely get a Radio C of 8% to 12% or more.
Test Conversion Before You Advertise!
A good method is to run a KW PPC test in a local market along with a small email blast against an opt-in list of persons who meet your Target Audience or Qualified Audience demos.
A 10-day KW test exposes 800 to 1,000 local Steam Heat Shoppers who search for any of 300 to 600 KW phrases to your Google or MSN Ad Copy. You see what KWs produce the best click-through and conversion. Use those KWs in your radio copy. (You might run a second test using the highest ranking SEEN-BUT-NOT-CLICKED KWs in revised Google Ad copy. See The Reflection Principle.)
The Email blast tests "copy" against mostly Tomorrow Shoppers who might click to your site to see what you offer Today. A good opt-in list will yield 15% to 20% open and click through rates. 5,000 persons give you a good sample of 125 to 200 visitors. I like to send the same copy to the same people on a Tuesday, Thursday and the following Monday.
In either test, look for a healthy bounce off your home page to any internal page (70% is the max; 30% is not too good); 3-5 internal page views; and a visit duration of 4 minutes or more. Of course, final conversion to sale is the key metric for Active and Impulse Shoppers.
The two tests can run simultaneously in most major markets, should cost under $5K, and deliver the good news (or the bad news) well in advance of running a radio or TV test.
Slickify Your TMs, too.
Your website is your store. Your TMs are your front-line sales force. Make sure they hear your spots and understand all claims and offers your make. Make sure they know their way around your site. Some prospects, especially disabled persons, may need help finding what
they want. TMs can help you improve your radio and web copy, too. Ask them to run a Brand Resistance Survey among the next 500 to 1,000 callers. Apply what you learn to your next round of creative.
Good salespersons work on commission. Do yours? A 5% bounty on each unit sale adds a little to the selling price but may increase your conversion greatly as well as your revenues.
When the phone aren't ringing, your in-house TMs should call recent on-line customers. Thank them for buying. Make friends. Get an email address. Send them newsletters, reminder emails, special offers on new products...
Whether you use radio or PPC or a combination of the two, first time shoppers are a lot more expensive than repeat customers.
Technical Note
GM/C + TM = X. If you want to include Telemarketing costs in MCPS, determine an average [phone time + TM time & commission] per sale. TM training and initial set-up costs, like creative & production, are properly an overhead cost of business and should be amortized over time.
How to Track Radio Click-to Sales.
You want Impulse Shoppers to type some URL into their browsers or Google bars. You have to separate them from PPC or SEOP clicks and follow them from Landing Page to Shopping Cart to Check Out. Is your data base manager up to the task?
If your site and shopping cart are on separate servers, be certain you can follow all paths from initial visit to check-out. Plan to compare media-driven to PPC and organic drop-off rates. Ask buyers where they heard of you. Most shopping carts can track "votes" from drop-down menus.
TEST MARKET WORKAROUND. You cannot track Radio clicks by ZIP Code, but you can track shipments by ZIP. Every DMA is a cluster of 20 to 300 ZIP Codes. Have your warehouse manager establish a six-week baseline of shipments to the ZIPs in your test market. Then run the commercials. Incremental shipments must come from Radio Clicks!
NETWORK CLICK SURGES. When your commercials run on network, millions of people hear them. All at
once. Those who respond may do so... all at once. So set benchmarks for hourly click-volume and see what happens when a spot runs on, say Sean Hannity at 3:18P EST, reaching 1,565,000 P25+. If your spot has a 1-800 CTA, incremental call volume and click volume for the next hour or so probably come from Sean.
Case in point: After nine months in smaller network vehicles, we ran two Dinovite :60s on Sean on three separate Mondays, then compared total incremental sales to the five-week baseline:
How to Track 1-800
plus Click-to Response.
If your spot includes a phone number and a URL in the call to action, your total response will split something like 30% phone - 70% click. (Many women would rather shop on line than talk to a stranger on the phone.) Your 1-800 number should be clear and bold on your landing page. Many people will click to your site, scan, then call for answers to their personal questions.
TEST MARKET WORKAROUND. Track shipments by ZIP cluster, and incoming 1-800 calls by originating Area Code.
A huge blowtorch AM station like WBBM-AM in Chicago will reach hundreds of Area Codes. Compare the station's coverage map with a good on-line AC Map.
Should you shift PPC dollars to Click-to Radio?
There are about ten factors that influence the decision to build sales using a combination of PPC and Click-to Radio. Most Dot-Com advertisers have their own set of KPIs.
If you're comfortable buying PPC clicks and paying SEOPs fees, the fundamental block to testing radio is that you don't know what the trade-off is between investments. SO:
Run The Numbers!
If you switch $X from PPC to Radio, what's your MCPS?
To answer that question start with a breakeven analysis. Given, say, an average PPC rate of 32 cents and 2% conversion, how many unit sales do you expect, and at what MCPS? What combinations of G, M, and C would you need to get the same MCPS in radio?
That $2.89 CPM is doable on network. You might run a local radio test to see if you can get G=.664 and C=12%, before or after Slickifying.
Then you might consider what would happen if you spent $100,000 on either PPC or Radio. You could buy a ton of top listings for hundreds of obscure KeyWord Phrase. The average cost per click might drop, but unless you optimize hundreds of landing pages for all those KWs, conversion is likely to drop too.
Meanwhile, the same money in radio would likely build response and awareness with frequency. That would give you a lower G and possibly a slightly higher C. Compare MCPS:
Notice that GM/C works in PPC, too! The same 6th Grade arithmetic yields a $24.17 MCPS for a massive PPC rollout, and a $13.34 MCPS for a modest network radio run. In practice, there's a ceiling on how many profitable clicks you can buy from Google or Overture. The ceiling on profitable radio clicks is way, way up there in the clouds.
What if you split the budget three ways: Spend $20k really greasing your design and navigation. That effort will pay off for years! Get PPC conversion up to 3%or 4%, which in turn increases Radio Conversion. Split the remaining $80K between PPC and radio.
The PPC ceiling is still there, so leave that $40K alone. Roll out just the radio. Build frequency, get an even lower G:
Just for grins, scroll back up to see where you were with your $10,000 PPC budget. That's about where Ed Lukacevic at Dinovite came in in January 2006. Where are we today? Well, Stinky Dog! Radio has brought in 140,000 new customers, who now average $60 per purchase. You do the arithmetic.
Streaming PPC: The new Virtual P.I.
Many radio stations now stream their on-air programming. The streaming screen on a listener's computer often includes a banner that links directly to the advertiser's home page or landing page. Most stations will gladly sell you a bundle of streaming impressions for a set price.
Since stations can't run AFTRA Talent commercials in their streams, Arbitron does not rate streaming audiences. They're usually 3% to 12% of the terrestrial cume. I did figure out a way to estimate TA GIMPS and CPM from standard bundles and Webmaster data. Also 6th Grade Arithmetic.
Looking forward a year or two (and backward 30!), it's not too hard to imagine a rate structure in which the station charges a mutually agreeable Pay Per Click rate from their streaming screens. Same idea as good old PI.
Streaming PPC is simply a 21st Century version of a tried and true model. Stations get paid for what they produce. So, by the way, do you.
Once streaming radio stations realize they're competing with Google and not the similar format station across town, Streaming PPC will become standard fare.
You heard it here first.
What If Radio Works!?Network is the penultimate rollout media.
Say you slickify your site, test local radio, roll out into network, and increase revenues next year by 200% to 2000%. What next?
Along the way you'll likely test lots of different copy platforms, and you'll hone in on the right "words". Psychologists say that 30% of the population prefers to get new information through the ear. The other 70% are more visually inclined. So apply what you've learned from Radio to TV.
Track GIMPS, sales and MCPS by DMA ZIP Cluster. Identify strong markets. Test the TV version of your best radio copy on a few local CTVOs. You might buy different cablenets on adjacent CTVOs. Use the same GM/C=X logic, except that in TV, Gross Impressions become Households. Identify the strongest commercials and cablenets. Go national, once again at much lower CPM. One day..."Today."
What Have You Learned Today?
In seven pages and about 30 minutes you've learned that 1-800 and Click-to radio works a little like print. Both media attract a loyal audience, but timing and frequency are much more important in radio. When you run radio (days, day parts) and how often you run directly affects response rates.
Frequency can build response. Your Optimum Effective Frequency (OEF) is a range of frequencies in which most of your Inquiries occur. You can determine your own historic OEF fairly easily.
Your best stations deliver high concentrations of your Target Audience and Qualified Audience at the lowest possible TA CPM and QA CPM. Most response will come from P1 QAs, who prefer your stations to any others. If you want to reach a lot of QAs, rank local stations by P1 QA cume and buy down the list.
Media Cost Per Sale is the most important number in DR. You can track it via CICO but GM/C=X simultaneously monitors the three variables (response rate, media cost, and conversion) that influence MCPS. If you track daily or weekly G, for example, the lower the G the better the response. Run your copy until G turns up.
Local tests pave the way to network rollouts. Whatever G and C you get from a local test will likely apply in network, but at a much lower M. If you track GIMPS, sales and G by DMA ZIP-Cluster, you'll identify strong markets worthy of heavy-up spot radio or TV tests.
It pays to Slickify! In Click-to DR, Conversion is King. Any improvements in clarity, usability or navigation that improve C by even one or two percent will yield long run dividends. Get PPC conversion up to 3% or 4% and you'll likely get much higher C from radio-driven Impulse Shoppers, too - when you decide to try Click-to Radio.
In short, the combination of good 1-800 & Click-To Creative, accurate buying, tracking, and tweaking can mine sales from radio cumes at relative low media cost and attractive MCPS. You can easily increase revenues 200% to 2000% by this time next year.
Ed did.Interested?
"OK. I get it. I'll probably have to think about it, though. Examine all the options. Ponder. Ask my Team of Team Players for feedback. Procrastinate.... Oh, what the hell - what's your phone number?"
(407) 895-3092
Intro DR Radio v Print How Frequency Builds Response How To Select Stations
GM/C = X versus CICO How To Test & Roll Out Click-to & 1-800 DR
