One Formula to Guide Your Paid Media Strategy
By: Ross Lawrence
Tags: Social Media, Digital Marketing, Advertising

One Formula to Guide Your Paid

Media Strategy

Paid promotion isn’t just for the content marketers, but you’ve got to think harder about ROI if you’re in the influence game

It’s among the thorniest questions in digital marketing. For all the persuasive arguments about why modern companies must act like publishers — and for all the obvious advantages of leading a conversation around topics central to your brand or mission — the real key to enduring success lies with how you define and measure ROI.

The reason is simple. Without that clear sense of purpose, even if some of your efforts work, you won’t know which things to grow and repeat. To throw a buzzword at the problem: Your successes won’t scale. And beyond that, without some evident connection to “the bottom line,” it all begins to look like a hopeless exercise in vanity.

That’s true of any marketing or content-creation program, of course, but it’s of particular significance for promoting your work with paid media. When your team is spending money on channels like Facebook or Taboola, the investment is no longer just about creating repurposable knowledge assets or branding — it’s about direct audience development. If you mess it up, you’ve squandered your money on someone else’s platform with nothing lasting to show for it.

But it’s also true that audience building is the most pivotal and unpredictable piece of the whole puzzle, and paid media can be a critical component of that. So the lesson isn’t to turn up your nose at the price and walk away. Rather, you have to have a disciplined way of gauging whether you’ve gotten your dollar’s worth.

At heart, that boils down to one simple and familiar formula:

Acquisition cost < Long-term value

In this instance, that simply means the cost of acquiring a customer should be less than the long-term value said customer provides your business or organization. If that basic comparison holds, you’ve made a good investment.

Naturally, the word “customer” here can take many shapes. For content marketing, it’s more literal, and thus ROI is relatively easy to calculate: success equals sales. It’s highly measurable so long as your analytics are set up correctly.

That also means when it comes to assessing audience quality — the factor that should be driving your paid media decisions most directly — the content marketers again have a leg up. Quality here can be judged most purely by someone’s propensity to buy, meaning the question of whether your paid promotion was worth it can be answered mathematically. If you spent less acquiring the prospect than the average contract value you obtain from that customer — taking into account the varying rates of conversion across different channels — then your efforts paid off. There’s nuance to each of these steps, certainly, but it’s a clean calculation in principle.

Of course, it’s also much easier in this case to tell if the “cheap traffic” you’re getting from the big social platforms isn’t actually a bargain at all. It doesn’t matter if you get twice as many clicks on your sponsored post on Facebook as you do on LinkedIn if those Facebook visitors are only a quarter as likely to turn into qualified leads.

That brings us to the moneyball question: if you’re trying to own a knowledge niche or develop a voice in your industry rather than make a sale, how is it clear what’s working?

The objectives, even if clearly defined, usually aren’t directly monetizable — they often include things like influence, visibility, validation, and access. That can be true for certain business campaigns or initiatives, but of course it goes double for think tanks, associations, advocacy groups, and media providers.

It’s a big, knotty question with a lot of implications. When it comes to determining ROI, the basic cost-value formula doesn’t change — but at its crux is the need to define “value” differently than just a contract.

That value can take numerous forms. Closer interaction with your key audiences helps to strengthen your ideas, your brand, and ultimately, what you bring to market. And it’s a good reminder that these relationships shouldn’t be defined purely as a series of business transactions — they can be thought of as pathways to better internalize your audience’s ever-evolving needs.

So if the goal is to nourish these types of connections, paid channels clearly have a role to play. Two criteria must drive your decision-making, however: retention and audience quality. Most organizations can’t justify paying even a few dollars every time an anonymous someone clicks, reads 500 words, and then never comes back. You need lasting value.

How do you get there? The starting point is to have a strong, precise understanding of your goals, your audience, and how your content supports both. But what’s just as critical and often overlooked is having a clear conversion goal and funnel for each target.

Among the most common and valuable of these conversions is email signup, which — with the right subscription experience — can help with both retention and understanding your audience at a more granular level. But depending upon what you’re doing, there’s room for creativity here. Your platform might invite people to sign a petition, join a select community, or enter a co-creation contest for a new product or feature.

“Engagement” is often a hollow word, but it works as a game plan when it’s tied to specific participatory experiences.

Once you’ve mapped out these funnels, the importance of selecting your audiences carefully becomes crystal clear. Higher-value platforms like LinkedIn can help you to avoid the cheap-traffic trap with more sophisticated targeting tools and analytics reports than competitors offer. Then, once someone clicks through to your site, the key is to A/B test conversion channels aggressively to gauge what’s most effective.

It takes commitment, but once conversion “beyond the click” rests at the heart of your paid promotion strategy, you’ll be well on your way to forging connections that have real impact.