What is Last Mile Marketing?

How to sell more and multiply marketing effectiveness

The last mile is the customer’s path between landing on your site and buying what you’re selling. Last mile marketing is the practice of selling more by applying marketing strategy to this section of the customer journey.

What is the last mile problem in marketing?

In logistics the “last mile problem” describes how moving goods to somewhere near their destination (along railways or motorways) has always been much more efficient than moving them the comparatively short final distance to their destination (navigating cities and buildings). Marketing now faces a similar challenge, before rather than after the sale.

Artificial intelligence and machine learning are letting us optimise and automate digital advertising to an extreme degree. Even though ad-blocking software proliferates, SEO and other means of getting visitors to websites are more sophisticated than ever.

However, most websites have wastefully low conversion rates. This is because marketing has been shut out from the last mile.

Last mile marketing has emerged in response to the consistently low conversion rates of most websites.

Buying behaviours of both businesses and consumers are changing. Buyers are spending longer on online research before they even enter a recognised sales process and a gap has opened up between marketing and sales.

It is a fundamental principle of last mile marketing that once a visitor arrives on a website, their individual needs become more important than the general interest that led them to click. Marketing’s last mile problem is rooted in this inability to manage the transition from the general targeted segment to the specific needs of the individual customer.

Last mile marketing optimises for every customer

Marketing built its reputation on segmentation and targeting. Before positioning and branding, pricing and promotion, every marketer knows that you need to start with understanding the market and targeting a segment. Last mile marketing is about rediscovering this core strategy in the online customer journey.

Marketers have become familiar with conversion rate optimisation (CRO) but technological constraints have limited the effectiveness of most of their efforts. CRO has generally been practised as a search for marginal gains. This is putting the cart before the horse. Marketing needs to shape the customer journey from landing to purchase, not just at isolated touchpoints.

The way marketers have approached AB testing has not helped. The most important factor determining the success of a variant on a website or in an app is not any aspect of the experience itself, but the situation of the user. The best in the business know the importance of segmenting AB test results. However, marketing’s heart beats faster than statistics, so waiting for statistical confidence has been hard enough with data on all users, let alone just a segment.

If you want to segment the data and therefore reduce the amount of evidence you have, the only way to maintain a workable level of statistical certainty is to increase the size of the underlying effect. A large, real, journey-level difference will be detectable faster than a small one with the same number of data points. Major journey optimisations are therefore the only way to optimise conversion rates while accounting for proper segmentation.

Marketing has approached CRO from the wrong end, simply because it has been technologically easier to jump straight into minor tactical tweaks. The marketing execution gap has held marketers back from applying strategy to the last mile.

The last mile has more influence over marketing effectiveness than any other single factor

Advertising, branding, and the rest of your marketing strategy bring valuable visitors to your website. They are valuable not just because they might go from visitor to customer, but because you have invested time and money to get them here.

Your website therefore has a greater influence on marketing ROI than anything else. PPC, SEO, influencers, content, email marketing, affiliates, promotions, and advocacy, every one is governed by the last mile. A 1% last mile conversion rate can sink a brilliant campaign. 10% can wring profit out of an otherwise disappointing attempt.

Last mile marketing is also a response to the falling effectiveness of marketing campaigns.

Marketing spend has increased, digital disproportionately so, but the results have been disappointing. One of the reasons has been that marketers have been incentivised to overspend on short-term boosts to vanity metrics like clicks and impressions.

Last mile marketing links landings to real results

All the touchpoints between landing and conversion make up the last mile. It therefore stretches all the way to your real business goals. However, even marketers who are using segmentation in the customer experience rarely go beyond the landing page.

Last mile marketing is therefore about journeys. The last mile marketer segments, builds and tests entire journeys from landing to conversion. Crucially, conversion can now be a real business metric, such as transactions, weighed against visitors at every stage of the website funnel, and differentiated according to segment.

In last mile marketing, personalisation and optimisation are no longer two different things. They are parts of a sliding scale of segmentation, from optimising for broad segments all the way down to pin-pointing individual customers. The most profitable last miles come from marketers applying customer data-based optimisations in a concentrated and layered way to this crucial pre-purchase section of the customer journey.

Your website is often where you are closest to your customer. You know more about customers on your website than anywhere else. Their presence alone suggests they are interested. This should be the simplest part of the journey. You can use what you know about the customer to meet their needs and make it as easy as possible for them to get over the line.

How do I know I’m ready to create a last mile marketing strategy?

You are ready for last mile marketing if you find yourself in any of the following situations:

  • I have ideas for better customer journeys but don’t know where to start with trying them out on our website.
  • I am successfully growing traffic to the website but I’m being judged on conversions that are out of my control.
  • I have tried CRO and found it difficult to create lasting uplifts to real metrics.
  • I’m still waiting for our marketing cloud implementation to complete but I want to start experimenting with journeys.
  • I have access to a lot of customer data but I find it hard to use it to improve the customer experience.
  • I find it hard to track and improve the effectiveness of the different acquisition channels involving our website.

I want to hear more about last mile marketing

Further reading

 

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