Marketing is a numbers game. From your cost per reach to your cost per acquisition; every cent counts. Businesses don’t have the luxury of burning budget on a campaign that doesn’t land, nor should there be a practice of attributing spend to a campaign that isn’t geared to the right audience. When it comes to reducing your cost per lead, there are numerous tactics that you can employ.
However, for most, it all starts with an acute understanding of your ideal or highest converting customer. No, we’re not talking about a specific individual but rather parallel data about the type of individual more likely to be engaged by what your business has to offer (also known as a buyer persona).
By using accurate buyer personas to reduce your cost per lead, you will consistently be able to acquire better quality customers, save a few bucks and enable stronger communications via social media. It’s a complete win for your organization.
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Conversely, marketing to who you ‘think’ is your ideal customer without research will fast-track unprofitable marketing and burn your great content on an audience that isn’t there or in a position to buy. As such, should you want cheaper leads, collecting marketing data over time is the single most important measure you should implement right now.
In this guide, we’ll explore how to use buyer personas to reduce your cost per lead and grow your business. When you are done, don’t forget to write in the comments with any questions or suggestions you may have that will add value to other readers.
What is a Buyer Persona?
A buyer persona, composite customer and customer avatar – you might know this concept under a few names. Before we delve into how to use buyer personas to reduce your cost per lead, first we must understand the definition of buyer personas. A common misconception is that buyer personas stop at demographical data such as age, gender and location, and this is certainly as far as the research went in years gone by. However, there is much more to creating successful marketing personas than just primitive insights.
“A buyer persona is a composite sketch of a key segment of your audience”Ardath Albee
Through battle-hardened market research of your existing customer base, you can formulate an accurate conclusion as to what type of individual is most likely to purchase from you. It starts with top-level demographics and finishes with a series of carefully selected buyer persona questions. Of which, the answers to these questions will uncover details from likes and dislikes to even political stances to formulate your ‘buyer persona’.
In fact, the more questions you can generate, the more accurate your buyer persona will become, and you never know which information you find today could support a decision in the future. If you have ever been served content that resonates with you on a deep level, then the creator of this paid activity is using your persona information to cut through the noise and reach you, specifically.
As with any form of decision making, especially with B2B marketing, there are often multiple people that will influence the decision. So, whilst your composite sketch may dictate a CEO, you need to carefully consider the entourage as influential anti-personas. Said CEO might be the end-user, but who is doing the purchasing and how can they be reached?
To formulate the greatest of buyer personas, you will need to uncover the answers to specific questions that are relative to your business. Some companies even name their buyer personas like ‘Rachel, the stay at home mum’ for easy remembrance. It also humanises your buyer segments, with your business interpreting customer values, needs and interests with more curiosity.
Once you have this information (which is refined over time), you can then use your data to formulate marketing strategies that best lend themselves to your identified persona. Remember, just because ‘Rachel, the stay at home mum’ likes food subscription services, doesn’t necessarily mean that she enjoys purchasing gym equipment. As such, creating a master persona for your business and then micro-personas for each facet of your business will fast-track you to reducing your cost per lead. Being this granular in detail and tasking yourself with learning more will save you from lazy, stereotyped assumptions that fall on their face and fail to reach Rachel or any other persona.
Unfortunately, many marketers employ a knee-jerk approach to their buyer persona, making assumptions that don’t always stand up. For example, just because ‘Rachel’ is a certain age according to her persona, doesn’t mean she is interested in or shown behaviour to suggest she is looking for anti-ageing products.
How to Create a Detailed Buyer Persona
Now you understand the acute details which form a buyer persona, let’s delve into how to create a detailed buyer persona for your business. It all starts with waiting until you have quantitative data from your customers. Through online tracking tools like Google Analytics, you can export large datasets that will give you top-level demographic insights.
You can also use Facebook Business Manager and Instagram Insights to add another contextual layer to what you find from Google Analytics, although your social data is only good as your engagement and activity on these platforms (note: Instagram will not give you access to data unless you have more than 100 followers). A broader, multi-source approach to your persona data will result in a complex and detailed picture which taps into the behaviour and belief systems of your buyer.
By trying to formulate buying personas before acquiring enough customers, you are somewhat shooting in the dark, and you don’t want to hinge your activity and budget only an idea of your persona – you want to get this to a science. Once you have quantitative data, you can then start to work on qualitative insights by asking the right buyer persona questions. These, of course, include the preliminary demographic questions, but they also dig into some behavioural habits and motivation factors that bring your audience online and ready to convert under what ideal circumstances. It won’t be possible for all businesses, but if you can actually facilitate face-to-face interviews with your customers directly, you will unearth an incredible insight beyond what you can dig out in analytics.
Should you not want to do this manually or use a template, there are also free online tools that can generate buyer personas for you such as Hubspot’s ‘Make A Persona’ online generator. You can maybe try out a couple before you decide on one tool. If you find that your business has already done the leg work in conceptualising your buyer personas, make sure you are asking when these were last looked at and what sources were used. As brands, we tend to let our own brand personality and perception shape our thoughts about our customers, and these bias’ will not serve you but simply add more ambiguity to your buyer persona.
How to Reduce Your Cost Per Lead With Buyer Personas?
From your cost per 1000 people reached to how many people you can reach per $1,000 to how much it costs you to acquire a new lead or purchase. In fact, the role of a PPC team is to continue to test and optimize paid activity so that the leads are generated at a reduced cost after exhaustive analysis over every part of the content and call to action. Research and data efforts now will yield qualified, lower-cost leads that can be retained on autopilot.
Remarketing campaigns can be achieved through Google Ads and Facebook Ads, although the former is going to expose you to a greater number of leads. Many businesses will say that their remarketing activity is their highest converting campaign, and actually comes in the cheapest. This is because the campaigns prior have warmed the audience and eliminated those who don’t fit into any of your guest personas and honed in on those who have responded to your content in a way that would suggest they fall within your guest person type. Remarketing can also be more fun or even more direct in nature, as the recipients know who you are already. Suddenly your limited word count doesn’t need to be expended clarifying who you are and your offering, and can actually speak to them on a more suggestive and persona-appropriate language.
Jumping into social, another campaign to familiarize yourself with is a ‘look alike’ campaign, which can yield a low-cost conversion if done correctly, with the success coming from a well-identified guest persona. Essentially, you task Facebook with finding profiles that have the same attributes as the audience currently engaged with your business and compiles these personas for you to serve ads to. Lookalike campaigns are a great proactive approach to shaping your audience, and it will put your buyer personas to the test to see which respond to your brand.
Buyer Persona Missteps to Look Out For
Now that we have discussed and demonstrated the importance of an accurate buyer persona and how we can use it to design better, lower-cost leads – then what are the missteps that we need to look out for? The most important mistake to avoid is to base your buyer persona off of the wrong group of people or not enough people. This will stunt the insights you can glean, and it will have you investigating the wrong routes which will blow out the cost per lead, not to mention the many missed opportunities.
Similarly, having too many personas is a sure-fire way to over-complicate your perception of the market you operate in and who responds to what. You should be aiming for about 5 guest personas, although horrifyingly some brands have upwards of 20 personas which demand their own unique strategies and attention. Unless you are a multi-faceted business, stick to a small number so you can service them appropriately. More buyer personas do not equal more customers, it just dilutes what you are trying to achieve by pursuing markets that are low-converting or simply not interested in you.
Channel tunnel vision is another common misstep, where businesses can tailor a website that speaks to the unique needs of their buyer persona, and yet their social speaks in a completely different tone to generate likes and comments, rather than using this channel as an instrument to attract and convert that buyer persona. Your buyer persona regardless of their behavior and demographics is going to make their way through the 5 stages of decision making:
- Problem or need recognition
- Information search
- Evaluation of options
- Post-purchase actions
If each of your channels has targeted or ignored your unique buyer personas throughout this decision-making process, you are going to see a high cost per lead as you have no nurtured them through the funnel or even remained consistent in how you communicate with them and how you communicate your brand. If your business has a different team member managing each channel, these buyer personas must be researched and signed off together to ensure a unified approach. This is also going to get more of your team engaged in the personas you are chasing, which will result in better placed paid activity.
Buyer personas are not something to fear, and they will start to make more sense and be more central to the success of your business if you put the work into illustrating who they are, their needs and how your brand can meet those needs. You might even wish to dedicate a day to this persona research and creation, as this is ultimately going to be the underpinning of your content going forward.
Your buyer personas are something you want to be reviewing with some regularity, as generations change and so do our customer types, although only do so every six months so that you are not continually down a rabbit hole looking for the ‘why’ and can actually put this data to use and reduce your cost per lead.