When the inevitable marketing buzzword lists of 2019 roll out in a few months, you can bet you’re going to see the word “performance” topping more than a few of them. This year, as in recent years past, all eyes have been on data-driven tactics proven to drive conversions, and internal brand teams are spending many an hour talking about how they can improve their performance marketing efforts.
Here’s a tip: If you want to improve your performance marketing, take a look at what today’s gaming companies have been doing for more than a decade—and then emulate that.
Quite simply, gaming brand marketers have built performance marketing into their DNA since Day 1. One could argue that part of the reason is that the performance marketing mindset aligns nicely with the core strengths of the gaming industry. These are technology-driven companies for whom customer acquisition and experience is everything. The very development of a game requires intense rigor and countless hours of analysis and QA. Refinement and optimization of the player journey is not altogether dissimilar from what it takes to understand and optimize the customer journey from a marketing perspective.
Of course, it goes deeper than that. Today’s gaming companies are operating in a fiercely competitive, fast-moving space. Fortunately, they’re also sitting on top of a wealth of user data that can guide their customer acquisition and retention efforts. The key to success, they’ve realized, is putting that data to work to understand not just the effects of their marketing efforts, but also how those efforts impact customer lifetime value (LTV).
Ultimately, LTV is everything for a gaming company, and a gaming marketer’s understanding of this metric is key to establishing appropriate ranges for their customer acquisition costs (CACs). Provided a marketer can establish the effectiveness of certain tactics in driving high LTV, then the sky’s the limit when it comes to approved CAC. But without that understanding, it’s impossible for a gaming company to know whether it’s spending too much—or too little—on its acquisition efforts.
The same is true for nearly every brand in today’s marketplace, and the rising costs associated with advertising on popular direct-response channels is awakening marketers across all verticals to this reality. Simply put, as a marketer today, you can no longer afford to be setting arbitrary ceilings on your CACs. You must roll up your sleeves, dig into the data available and put true performance at the heart of your organizations. Above all, you need to ensure you understand how your marketing efforts influence customer LTV and adjust all efforts and spends accordingly.
And if all else fails: Consider hiring a former gaming company CMO.