I used to think that conversions were the greatest thing that ever happened to digital marketing.
Instead of tweaking my campaigns to improve the CTR or hell, the reach of the ads, I instead was able to make improvements based on leads or even sales. This completely changed how I did all of my marketing. My consulting became focused entirely around this amazing concept.
If you knew the cost of your conversion, you could do a little extra math and even estimate the revenue or the margin of your digital marketing. Talk about an amazing way to sell people on digital! You couldn't point to a radio ad and say that ad at that time made us $x in revenue!
Time moved on
It isn't 2007 anymore. Digital marketing technology has gone WAY beyond just putting a tag on your thank you page. You can track almost anything you can imagine - from ecommerce to even long term B2B sales through your Salesforce setup (connected to analytics with custom events).
Sure, you might say, I'll move to that - my conversion will be a sale. Which I agree with you is cool, but what if... what if one sale was worth more than another? I'm not just talking about revenue by channel either.
You've probably heard life time value thrown around a bit but I'll give you a quick overview:
LTV is a calculation of the value of each of your customers. This metric can be measured by channel or by each individual customer. The theory is that some customers are better than others over time.
Retail is the easiest way to explain it: one customer, let's call her Jen, buys a TV. Later on she goes on to buy a cable for it, a stand, a bunch of other stuff. She also becomes a regular customer of the store, purchasing lots of other products over time from it.
Jack on the other hand buys only the TV and nothing else from the store.
Jen is obviously more valuable to your company than Jack.
Now if you look at the LTV of each you can look at things like where they came from. Jen maybe purchased the TV after seeing a display ad while Jack just saw a flyer showing it was on sale.
You might change how you do your advertising based on that information. Most companies are willing to pay more to acquire Jen if it means more profit in the long run.
If you only use conversions as a metric, you could be getting a lot of Jack's and no Jens.
But I'm not in retail
You might say. Which is fair. I'm not in retail either but the same general concept applies. You need to find the actual value of your customer and attach it to the customer so you can measure all your marketing based on it.
Is an enterprise customer worth more than a small business? What about a customer that uses your "premium" features over the free ones?
The first step is to actually decide what "high value" even means. This is different depending on the business and something I've helped other companies with through consultations. It can take a lot of work but is very much worth it.
Once you have a calculation for value you can then improve your marketing using it, send it to machine learning systems to improve bidding and even create audiences (and suppression audiences) using it to vastly improve your marketing across the board.
What I'm saying is...
Focus on the value of your customers, find a way to measure it and use that for your marketing, not just conversions.