Campaign Management Series: How to Test a Direct Response (Lead-Gen) Campaign

Next up in our campaign management series is overseeing lead-gen (aka “direct response”) campaigns. We previously discussed how e-commerce advertisers should test advertising campaigns; now we’ll dive into assessing campaigns focused on generating leads for your business. 

Lead generation is a key part of the marketing funnel, serving as the entry point for your relationship with your customers. Ensuring your direct response campaigns run as effectively as possible is crucial to driving a steady flow of traffic to your landing page or website, so you can convert leads into paying customers. 

Unlike e-commerce advertising, direct response campaigns have a much longer sales cycle with more moving parts. While e-commerce advertisers can typically get a sense for how their campaign is performing in a matter of weeks, direct response campaigns may need to run 40-60 days before being able to fully assess the results. 

This extended sales cycle corresponds with the overall marketing funnel, which is longer as it requires a company to have numerous touch-points with customers before they ultimately convert. However, the eventual payout is generally much higher.

Consider the process for home mortgage providers, for example. The advertiser first needs to grab the attention of prospective buyers with their ads, then bring them into the marketing funnel by having them sign up for more information, book an appointment, ask for a phone consultation, and then eventually run a credit check on them before finally closing a sale. While the process is certainly longer and more complex than a normal e-commerce purchase, the payoff for the mortgage provider is well worth the time and upfront cost! 

How to Set up a Direct Response Campaign

Before starting your campaign, it’s important to identify the key demographics for your product or service to determine the best sites on which to reach your customers. You also need to ensure you’re using an ad platform that supports all the filters your business needs to capture quality leads. Let’s again consider the example of mortgage providers; they only want to advertise to potential customers who are in a position to buy a house in a specific market. Therefore, they need to be able to target by state or zip code, and should thus choose a publisher site whose audience includes a decent percentage of potential home buyers.

It’s also important to choose a good native advertising partner to ensure you purchase quality traffic. This is especially crucial given the longer sales cycle, as you don’t want to discover several months into your campaign that your leads aren’t converting because you bought traffic from a low caliber site. 

Once you’ve chosen your audience and platform, it’s time to focus on making your ad content shine. And due to the longer sales cycle, direct response advertisers should be picky when choosing an advertising partner – you want to ensure that you choose a platform that allows you to upload multiple creatives in one go for testing.

How to Test a Direct Response Campaign

Once your campaign is live, you can sit back and let your ads run. After your campaign has been active for around 1-3 days, you can evaluate the bounce rate on your company’s landing page (which is normally a sales page). Based on the initial data you collect, you can make any necessary adjustments, but it’s important to remember you won’t be in a position to determine the effectiveness of your campaign for at least a month.

After a few weeks, you can begin to evaluate the Cost Per Lead (CPL), which is the cost for every sign-up on your company’s sales page. Your ultimate goal will be to have a good Cost Per Sale (CPS). If your CPL is slightly off target, try adjusting your filters or creatives to remedy the issue.

Once you have proof of concept by closing a few sales at a solid conversion cost, and you know that your traffic source is good, it’s time to scale up as much as possible. But keep in mind that your campaign performance might change over time, even on the same publisher website. So our best practice recommendation is to keep a close eye on all your campaigns in case you need to reevaluate.

In our next post, we’ll dive further into the benchmarks that direct response advertisers should consider when evaluating their campaigns’ performance.