Greg Dolan, CEO, Keen Decision Systems.
As summer quickly approaches and marketers start planning their budgets, they’re looking to find the spending sweet spot to maximize their ROI. For brands where the summer season is their peak season, the pressure is even higher. As such, they’ll often cram most of their spending into a span of a few months, even investing beyond the point of diminishing returns.
Instead of blowing their entire budget all at once, I urge brands to identify ways to optimize their budgets year-round. Below, I outline how marketers can optimize their marketing mix for peak seasons and beyond.
Observe Shopping Patterns
Before figuring out their seasonal marketing campaigns, brands need to identify key seasonal periods to find the specific weeks or months of their peak season.
This means looking at historical sales trends and identifying the key factors driving that behavior. For example, a company selling cold medicine can look at prior sales data to find where their sales start to increase and start running their campaigns during those months to meet the increase in demand.
Look To The Short Term
Following that, marketers need to account for the budget needed to fund their peak season. Marketers are going to want to modestly heavy up their spending to support the increase in consumer interest and demand. Instead of a long-term approach, invest in short-term tactics to drive sales over a set time period, creating a sense of urgency and encouraging immediate action.
Short-term tactics prioritize bottom-of-the-funnel strategies like personalized deals, coupons and calls to action instead of longer awareness plays that lead to building brand equity seen at the top of the funnel. For example, a company selling binders and folders might heavily invest in coupons in the weeks leading up to back-to-school.
While embracing short-term tactics helps increase profit potential for their peak season, brands shouldn’t neglect upper funnel strategies. In my experience, the ideal balance between upper- and bottom-funnel efforts over the course of a year is approximately 70/30. Maintaining a balanced approach throughout the year enhances interaction effects, making lower-funnel activity more effective and efficient when it matters most.
Build Around The Perimeter
Instead of investing only during peak seasons, it’s also important that brands invest in the shoulders. Shoulders are the weeks or months directly before and after a peak season. So, marketers should have advertising support leading up to the peak season, which then carries into the peak season and then on the backside of the peak. This ensures that the peak season has enough support and that a brand can maximize its ROI for its most important time period.
For example, brands that put their entire budget to support Prime Day on the day itself will likely lead to overspending and subsidizing demand that is already there. By having a plan that encompasses the weeks leading up to the day, including the event and extending a few weeks following Prime Day, they can lengthen the consumer buy cycle.
Understand The Point Of Diminishing Returns
While it’s important to maximize peak shopping periods, I find that a brand’s biggest mistake is going overboard on spending. Once marketers have reached the point where every dollar invested returns less than a dollar in ROI, they’ve gone too far and are wasting their investment. One example is when brands overinvest in major shopping days like Black Friday or Cyber Monday to chase an unsustainable goal.
To prevent wasted spending, modeling tools can help brands identify the point of diminishing returns and create a plan that spends up to that level for each channel and week of the investment.
Keep The Light On
As long as a product is available, marketing helps build awareness and drive sales, so brands can’t completely ignore the rest of the year. I find that having an always-on strategy builds equity and maintains market share.
Consumers notice if their favorite brand isn’t in the same shelf spot or if they’re not receiving emails, so they’ll be less likely to stick with a brand if they go dark. For example, if Campbell’s Soup pulled back on marketing during the summer months, Progresso could invest in strategic channels to steal customers and build year-round loyalty.
Building a solid seasonal marketing plan relies on a brand’s ability to understand seasonal cycles and adjust its plan to strategically invest year-round. By ignoring their reflex to spend it all at once and instead choosing to optimize their investments, a company can help ensure that its dollars are working effectively.
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