Overview

The goal of this article is to understand spend strategies available on the Adobe AdLens Dashboard, and the pro’s and cons of using each:

  • Daily
  • Day of Week
  • Monthly
  • Day of Month
  • Return on Investment (ROI)
  • Cost Per Transaction (CPT)
  • Marginal Cost Per Transaction (MCPT)

Spend Startegies

When setting up a Portfolio, advertisers are asked to provide budgets for their online marketing efforts.
Depending on the goals of the advertiser, the budget can be invested online in several different ways.
The different ways of spending the advertisers budgets, to meet the Objective, are called Spend Strategies.

Budgets are defined at the Portfolio level

The available Spend Strategies are:

  • Daily
  • Monthly
  • Day of Week
  • Day of Month
  • Return on Investment
  • Cost Per Transaction
  • Marginal Cost per Transaction

Types

Daily Budget

This is the most popular budget strategy for advertisers.

Once the daily budget is specified, the Adobe technology will spend close to that daily budget point over a 7-day average.

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The 7-day average is important because the Adobe technology takes into consideration the inherent weekly trends that advertisers have.

After gathering data, the technology may spend higher on certain days (with higher traffic) and compensate for the overspend by dropping spend on days with lower traffic.

Day of the Week Budget

This strategy is used by advertisers that have a strong weekly trend. (e.g. movie ticket vendors notice a spike in traffic on Fridays and weekends)

Or the strategy is used by advertisers that have constraints on certain days due to which they do not want to direct traffic to their website.

The advertiser in the below example does not have customer representatives to answer calls and process loan applications on weekends and hence has chosen to not show any ads on weekends.

 

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Monthly Budget

Most advertisers have a budget for the entire month.

And this budget strategy allows you to enter the monthly budget. The technology will find the appropriate amount to spend each day.

So effectively, a monthly budget strategy is converted into a daily budget by the Adobe technology.

If a budget is entered in the middle of the month, the Adobe technology will subtract the amount already spent earlier in that month, and spend the balance.

 

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Day of Month Budget

Some advertisers have a very pronounced intra-month trend which require them spend more oncertain days of the month than others.

In the below screenshot, the advertiser is spending more during peak tax season (till the 15th of the month) and then decreasing the spend for the rest of the month.

 

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Return on Investment (RoI) Budget

The ROI strategy is used by advertisers that don’t have a budget constraint. Their goal is to get a certain Return on Investment (RoI)

In case of an ROI strategy, we need to include only revenue in the Objective function (or at least, revenue has to have the highest weight by far). Also the revenue data captured should be reliable and without any discrepancies.

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Cost Per Transaction (CPT) Budget

The CPT strategy is used by advertisers that want to keep their cost of acquisition/transaction below a certain amount (in order to preserve profit margins)

A minimum and maximum budget limit can be set to ensure the online spend is within the advertisers budget limits.

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Marginal Cost Per Transaction (MCPT) Budget

The Marginal CPT strategy is used by advertisers that want to control the additional amount they spend in order to get an additional unit of revenue.

A minimum and maximum budget limit can be set to ensure the online spend is within the advertisers budget limits.

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