Performance marketing (paid search, display and paid social) is a challenging and interesting space with heavy industry jargon. Similar to customer vs consumer, the latter being a person who buys a product in your category/vertical but doesn’t buy from your company, like a customer would.
I see many people mix up and use the terms user acquisition & demand generation interchangeably. I don’t feel they mean the same thing.
So what is the key difference between the two terms?
Demand Generation: Sits at the top of the purchase funnel covering awareness and consideration
Similar to consumers, these people don’t buy from you (not yet anyways). Consumers might buy from you competitor(s) or you might have to show these people why they need your product. This is especially true if you’re creating a whole new category for your industry. This is what the iPod, tablets, Dropbox and even the selfie stick have all done. There was no (or very little) demand for this product before and in a few short years (9 for the selfie stick) you’ve people who can’t live without these product.
User Acquisition: Sits at the bottom of the purchase funnel covering purchase(s) and advocacy
Like customers, these people already use your product or service.User acquisition falls under purchase and advocacy for the purchase funnel. Customers could be new or long-term users of your product, but they buy from you none the less. Your job is to up/cross sell other products from your company and create a long-term customer for your brand. The work isn’t done once someone has bought from you, you’ve to work twice as hard to keep them as a customer.
What do you think… am I off base about user acquisition & demand generation?
I don’t know. No one does. 2015 for me will be about making not talking. I don’t want to tip my hand, but it’s going to be delish.
If you’re looking for inspiration. Huge Inc has a great look ahead and what they didn’t like about 2014. Google has their 2014 trends. Both are a treasure trove of ideas if you’re looking to get your hands dirty and make something in 2015.
While traveling around Asia from October until 9th December, I launched a blog post series on how to create a profitable performance campaign. I picked this topic because after being in this industry for 10 years and working across North America, Australia and Europe, it’s still the basics (to intermediate) items I see a lot of people get wrong. Plus talking to my Google CSRs, seems to be their issue to.
If you’re reading beyond this paragraph then please make sure you’ve the following done already:
- Review account structure and that you’re using negative keywords ruthlessly
- Is your AdWords account and Google Analytics (GA) linked?
- Check that your YouTube account, G+ Profile and other analytics package are synced up with GA or your main analytics package. You’ll be surprised how often this isn’t the case
- Review the account, campaign and adgroup settings on your account(s)
- Make sure all your URLs are live (no 404 page error or broken links)
- Have seasonal stock running? That should be turned off!
- Double check your match type and location targeting
- Don’t mistakenly have display campaigns active do you?
Why Does It Matters
Depending on your business, you may get 80% of your business from urban centres. However, you may not spend that same amount on your marketing in your those markets (could spend more or less). Finding out where you get your business from and what you spend to acquire that customer is a key determination of your success.
A similar example of this idea is a story I heard a few years ago about major bank who found out that 10% of their customers where producing 70% of the calls to their call centre (and thus were greatly unprofitable for them). After months of doing the research and double checking their number, they sent those customers a letter saying they couldn’t be a customer anymore and would happily help them transfer to a new bank. This allowed the bank to refocus on up selling and creating better services to their profitable customers.
Business is as much about making your company more money as it is about finding ways to cut down on your expenses and focus on your profitable areas of the business.
How To Do It
If you login your Google Analytics and head to the “Channel” subsection under “Acquisition” on the left hand panel. You’ll see all the different marketing channels that are driving your business forward.