Marketing is a very dynamic field, but there are classic frameworks that never get old.
We tell you about the coolest marketing models that will help you approach lead acquisition in a systematic way.
Today we’re going to talk about the 3 coolest frameworks that digital marketers, product managers, marketing directors and entrepreneurs use to structure and manage their digital marketing.
Once a digital marketing director of a huge multi-billion business came to me when he had to present his online marketing strategy to the CEO and the team of top managers, and he asked: how to present properly, what marketing structure and models can be chosen for his tasks and for his company? I advised him one of the 3 frameworks, which I will talk about next. Here we go.
Framework #1 – AARRR
In 2007, Dave McClure, ex-marketing director, by the way, of PayPal, and founder of the venture capital fund and startup gas pedal 500 Startups, or 500 Startups, proposed a model for measuring company growth that has been considered a benchmark for over a decade. And it’s called AARRR. He even uses pirate blindfolds in this model, and it’s easier to remember.
In his presentation “Pirate Metrics for Startups,” he outlined the AARRR framework, on the basis of which companies evaluate the marketing and management of their product.
How does the acronym AARRR, which consists of 2 letters A and 3 letters R, stand for?
- Acquisition – Users come to the site or mobile app from different marketing channels.
- Activation – The customer gets their first happy user experience. Some call activation the first point at which the user or customer gets the value they were promised.
- Retention – The customer returns, uses the product, product, or service multiple times.
- Referral – Users recommend the product or service to their friends, reduce your marketing costs.
- Revenue – users make payments or do other actions which the company monetizes in one way or another, for example, they view ads and the company earns money on it.
Separately in each of these 5 stages there are metrics and measurements to assess the effectiveness of each stage, the conversion rate from stage to stage, but we will not talk about them today.
At the end of the article there will be all the links, including Dave’s original presentation, where he gives examples of specific metrics.
Disadvantages of AARRR
AARRR is a pretty cool framework, but it has one significant disadvantage that has shown up over the last 10 years.
What is this disadvantage? First of all, the first A is responsible for the acquisition, i.e. everyone starts with engaging users. The framework was developed at a time when attracting users on the Internet, frankly speaking, cost a penny, and many channels were empty, not spammed, not craved the attention of advertisers. And so now we have a completely different situation.
Competition is very high in many channels, cost of attraction is growing, and it is quite difficult to scale advertising, because you have to have unit economy.
Now the market has changed. In many verticals, we are seeing a red, bloody ocean of high competition. And if a company works with an unprofitable unit-economy, i.e. if it costs more to attract a user than the user brings in money, and it will scale at this point to attract users, then accordingly it will scale losses, and you either need access to good investments, to long money, or the company will collapse. So now it is extremely important to work on user activation and retention first, and then scale the attraction.
That’s why, for example, the mobile app marketing guys, Mobile Growth Stack, suggested changing the order of elements in the acronym AARRR and therefore the sequence in which marketers work, to RARRA. Within the RARRA framework, you should first work on Retention, then switch to Activation, then work on Referral so that users invite friends, then work on monetization models (Revenue), and only then scale user engagement (or Acquisition).
In general, I want to add for myself that for me, working with marketing is like a kind of pumping up the wheels. Especially if you imagine you have four wheels or five. Basically, you spend all your time finding out where you have a flat tire, pumping it up, and while you’re pumping it up, dealing with this part of marketing, you start to have a flat tire in the next one, and you go around in circles like this.
So you shouldn’t take the AARRR framework very hard and go clearly from the first A to the second, then to the first R, and so on.
You can switch from one stage to another depending on the situation with your particular project, with your market, with your problems within the project, and with your bottlenecks. The main thing is that your final math should add up.
Framework #2 – AIDA
This is a very classic model, described in all the marketing textbooks. You’ve probably come across it.
- A is responsible for Attention (or attracting attention)
- I am interest of user
- D is Desire
- A is an Action (an action your customer has to take)
The main disadvantage of AIDA and other sequential models is that they don’t take into account post-purchase experience (such as user satisfaction, how often they re-purchase, how often they use the product) and post-purchase behavior (whether they recommend the product, product or service to someone else).
Therefore, the AIDA model has many modifications that are not always mentioned in marketing textbooks. For example, AIDAR (at the end Retention or retention), or AIDAS (at the end Satisfaction or satisfaction of the user from a product or service), or even AISDALSLove model, where we have Awareness, Interest, Search (search), Desire, Action, Like/Dislike, Share and Love/Hate, ie like, dislike, share with friends and whether you like this brand or hate this brand.
And there are so many similar frameworks or models that have different names but are essentially very similar to how AIDA is set up. For example, REAN (Reach, Engage, Activate, Nurture) or RACE (Reach, Act, Convert, Engage), but it’s essentially a variation on the AIDA theme or a very similar model.
And the second part of the criticism of the AIDA model, it is that the model is too linear, consistent and hierarchical. So we’re going to break down a very interesting marketing framework that says that the consumer journey is not linear, and we need to build our marketing more complex.
But before we get to this interesting model here, I want to stand up for AIDA. It’s still, I think, useful, especially if you learn how to use it at different levels of abstraction.
You can consider at a high level. A user sees an image on social media, pays attention to the company. The user clicks on the link, the text below the image piques their interest. For example, at a high level, we can consider that a user sees an image on a social network, they pay attention to the company, the user clicks on the link, the text under the image generates interest, they go to the website, and the website generates a desire to buy the product, and, for example, the user places an order, becomes a customer, they perform the action that we expect from them. In essence, that’s how we’ve looked at how social media advertising works in the AIDA model.
And if you go down to the level of abstractions below, you can consider, for example, a specific mailing list using AIDA model, where the subject line and the preacher attract attention, the banner on the first screen and the photo of products, for example, even without prices, below this banner stimulates interest, and the countdown timer and the call to action button cause a desire and the user takes action, in this case he clicks on our customer website.
In the first example, we looked at ads that lead to a purchase, and in the second example, we looked at the effectiveness of a particular email within AIDA, and we took a slice of the company’s marketing, so to speak.
If we go down to the level of abstraction below and look at a particular email marketing according to the AIDA model, the subject line of the email and the preview of the first lines attracts attention, a banner in the first screen when the user has already opened the email about the action and the photo of products, even without prices, below it makes him interested, a countdown timer to the end of the action and a call to action button makes the user want to click and make the action – a click on the website of our client.
That’s how we took a particular piece of our marketing in AIDA model and we limited ourselves here to click on the website, because the email marketing letter should simply lead to a click on the website, and the purchase will already happen on the website, and there the website itself will work to generate interest, desire and the user committed the next action.
So within AIDA, depending on the level of abstraction, you can take the final action of either opening a specific product, or adding a product to cart, or placing an online order, or even a completed order, depending on the level of abstraction you choose, you can pay attention to certain elements of marketing and treat them differently and go lower in details or go higher in the overall picture.
Framework #3 – ZMOT
In 2011, Google presented the Zero Moment of Truth framework.
It’s a separate story as to why they called it that. Six years earlier, The Wall Street Journal published an article that dramatically changed the marketing approach of many large companies. Marketers at Procter & Gamble revealed their secret to managing consumer behavior and called it the “First Moment of Truth” (or just FMOT).
What was it? A simple truth, but the result of Procter & Gamble’s long research in the field. The customer makes the decision, whether to buy the product or not, to take one brand or another, within 7 seconds, when he was in the store at the shelf with the products. Later, marketers came up with the “Second Moment of Truth” (Second Moment of Truth) – the process of using the product, when the consumer concludes whether he liked the product, justified expectations or not.
Incidentally, Procter & Gamble created a separate position, Director of First Moment of Truth. After that, in major companies, they started to organize departments that were exclusively engaged in merchandising, and beautiful window dressing, colorful advertising materials, different posters in stores, and other materials to attract the consumer and capture those seven seconds of his attention, so he would choose the company’s product on the shelf.
And then six years later we have the First Moment of Truth, the Second Moment of Truth, and Jim Lesinski’s book comes out, and there’s a special section on the Google website where they present the new Zero Moment of Truth framework.
What’s the point? Unlike AIDA, in ZMOT we consider that the consumer moves non-linearly. The average consumer used about 11 sources of information before making a purchase according to Google research in 2011, which is 10 years ago, and with the penetration of the Internet, cell phones, with their availability in our lives, the path has become even more non-linear, more confusing and the number of sources that influence the purchase decision has increased significantly.
For example, other marketers somehow come into contact with ZMOT when they talk about the ROPO (Research Online, Purchase Offline) effect, i.e. the consumer researches a product online, its properties, looks at reviews, reads about it in Stories or from a blogger, and then comes into an offline store, touches it and buys it.
We’ll include links in the release description where you can find the entire methodology, but essentially what you need to remember is that ZMOT is about working with touchpoints. The user is not moving in a linear fashion, they’re researching reviews, they’re reading reviews, they’re watching YouTube bloggers, they’re seeing ads, billboards, offline stores. And, essentially, we have to as marketers be good at working out all the tangents in order for the user to eventually lean in and buy our product.
How B2B marketing works online
ZMOT is especially, especially strong in narrow B2B markets.
Which framework to use?
All 3 frameworks are cool, worth using. We mostly use AIDA to evaluate the effectiveness of a specific ad, a specific placement and tweak there. If we are talking about ZMOT, we use it very much for B2B companies and companies that have ambitions to be on the market qualitatively. More often than not, these companies either have a marketing director or we act as their marketing director and work through all the touch points.
And if we’re talking about AARRR methodology, it’s most relevant for IT-product businesses, which need to work not only on attraction, but also on user conversion and making their marketing cheaper through retention and referrals, and it’s such a turbine that blows users away and creates some kind of a torque and speed boost for marketing, because attraction is becoming more expensive for IT-product companies, so you need to work not only on PPC, for example, to attract the paid traffic.
If you liked this issue, give it a like, don’t like it, give it a dislike. Write in the comments what questions you still have, what frameworks you’d like me to consider. We’ll either answer those questions in future episodes or I’ll answer them there in the comments. And I’ll see you all again. Bye, bye.
Useful materials on the topic: