High ROAS, No New Customers: What's Missing?

You see great numbers in your ads manager, but miss out on new customer revenue in your business?

In this week's Thought, we’ll discuss:

• Why your current creative strategy might mostly retarget existing buyers.
• Ad strategies to target new customers and drive incremental revenue instead.

Why Creatives Define Your Targeting

Who sees your ads depends primarily on your ad creatives, not your targeting settings.

If your ad features an anti-aging creme, it will unlikely appeal to 18 year old guys.

Duh! 🙄

The algorithm shows your ads to more of those users, who react positively to them.

Your anti-age ads resonate well with women 40+, engaged in beauty topics.

So, the algorithm will show them to more women 40+ interested in beauty.

Why Your Ads Appeal to Existing Customers

However, here’s the issue:

When you slam your products right into the viewers face from second 1 of your creative …

… you are telling the algorithm to do one thing:

“Show my ads to users who know my brand and products!”

In essence: You re-target existing customers and users familiar with your brand—your bottom funnel.

Here’s a prime example from Allbirds.

This ad is guaranteed to re-target existing customers, but not drive incremental, new growth:

If you don’t know Allbirds, their soft, comfortable, anti-bacterial shoes—you are unlikely to click on that ad.

Existing buyers, however, who have just been waiting for a different color to launch, will react.

Create Ads That Target New Customers

So, how can you drive incremental new customer revenue?

Instead of “fishing in the same pond” and spending a big chunk of your ad spend on existing customers?

What you need is a creative strategy reset.

Address your audience based on where they are at:

Not yet aware of the problem or solution.

Educate, Don’t Sell

Don’t directly sell to your audience, educate.

Let’s go through an example:

When you sell the best anti-age creme with all-natural ingredients:

Don’t say: “You hate wrinkles? Here is our amazing product with USP 1, 2, 3”.

Say: “Can you reduce wrinkles naturally?”

Followed by educational content that explains the natural ingredient.

Create demand in a new audience (that previously did not use anti-age products), because they were opposed to all the bad ingredients.

How Advertorials Work

Instead of directly selling or presenting your brand and products in the ad…

… focus on creating curiosity.

Your goal is getting viewers to click, then educate them, introduce them to your brand or product & convert them on the landing page.

The advertorial landing page leads the reader from being new to the topic (upper funnel, new audience) to get to know your brand.

And eventually, research more or directly buy.

Measuring The Impact of Advertorials

Changing your creative strategy is not as easy and straightforward as it sounds.

As long as your primary target are great numbers in the ads manager, you will optimize for bottom of funnel conversions.

You need good understanding of attribution; often beyond what can be measured directly.

Don’t trust one platform or tool. Look at different views.

Make sure you’ve implemented a post-purchase survey (“self-reported attribution”) and look at the overall business impact.

Takeaways

If you want to drive incremental new customer revenue, stop fishing in the same pond.

An educational, advertorial ads and content strategy can help you to tap into new audiences and create new demand.

It’s not easy, and it requires a change in how you run ads across platforms.