Optimizing Credit Card Campaigns

Card marketers must tighten their belts when it comes to getting ROI from online ad campaigns in the wake of declining click-through rates and a flood of increasingly savvy Web users.

According to Interwatch, credit card companies spent $41.8 million on online banner advertising last year. With all of this spending, one has to ask whether these media buys are worth it. Here are some points to consider when taking the plunge into launching a credit card acquisition campaign, where efficiency is the name of the game:

* Establish a goal. What do you want to accomplish with your budget? If your goal is to build long-term growth of application volume in the most cost-effective manner, consider the efficiencies of cost-per-action sites such as an affiliate network. If you're looking to acquire cardholders through a specific time-sensitive offer or have short-term volume goals, you'll want a campaign that employs a wide mix of sites and opt-in e-mail vehicles that will get your offer in front of as many users as possible for the least amount of money. Most of our clients are employing a mix of the two strategies to cover a number of bases.

* Establish a metric. Your campaign metric must be cost per application or cost per approved application. However, since the campaign will most likely have a variety of vehicles, each with different deal structures, creative units and placements can be optimized based on click rate or cost per click where appropriate. I'll get to optimization a little later.

* Target profiling and site selection. When considering which sites to advertise on, take into account factors besides cost, such as audience lifestyle compatibility and targeting capability. Know the composition of your target within each prospective site. This will give you a more accurate picture of how CPM costs will compare across sites, since you will need to burn more impressions to reach your target on a site with low composition.

* Competitive blocking. One problem in approaching sites to advertise with is much of the real estate is locked up with alliance deals. Even though a card company may partner with an e-commerce site to promote usage and build preference, the deal's terms may prevent competing cards from any advertising. It pays to approach these sites and explore if advertising is possible at all, since they may be high-performing sites.

* Beware of keywords. Although it seems natural to buy keywords on search engines to drive traffic to your application page, they normally command a high CPM cost, which will affect your cost per application. Establish a deal hierarchy and consider more efficient vehicles first, such as cost-per-application or cost-per-click buys before moving into premium areas.

* Optimization. The media is purchased and the banners are live. Now sit back and start counting applications, right? Not so fast. Now is the time to begin optimizing the campaign and make the buys more efficient. The goal is to reduce the cost per application while the campaign is running. To do this, site reporting data must be collected and analyzed each day or week. You should evaluate each site, placement and creative unit on a cost-per-application basis and rank them against one another. Pull units that are performing poorly from rotation, increase impression levels on better-performing units and move units into higher-performing areas within sites. Determine which units are converting the best and apply what you learn. Over the duration of the campaign, your cost per application should steadily decline as the buy becomes more efficient.

* Remember to test. Since optimizing ROI is an ongoing process, i-traffic generally tries to dedicate 10 percent of media spending toward testing new vehicles or creative concepts. Try to place buys on new sites within historically high-performing categories. Test offer vs. non-offer creative. The goal is to find out which combination of sites, placements and units produces the best results for your product so that future buys are more efficient right out of the gate.

The Internet has matured to a point that many users have become immune to much of the advertising that is out there. It's critical for marketers to make the most of each lead and learn how to move their ad dollars toward greater returns.

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