As a marketing manager, you know to follow the money. If a channel is consuming most of your budget, focus your time optimizing that channel’s performance. But what if optimizing a channel in a vacuum can actually destroy your success? That’s how you inadvertently enter the death spiral.

Imagine a paid search campaign. You optimize its performance to drive more and more conversions and sales through keyword refinements, bid adjustments, and message tweaking. You learn what message works really well and you then increase its budget to drive volume. Everyone’s happy, right?

The problem is that in doing so, you’re not optimizing your message, you’re optimizing your message on that channel by filtering out unwanted traffic. But what about the traffic unmotivated by a particular message? Your conversion rates will improve, but only with a smaller and smaller segment of the market. Your message has lost all flexibility as you take bigger slices of a shrinking pie.

You may think you cater to a certain demographic or audience type, but channel-focused optimization only narrows your audience to a slimmer and smaller (though higher performing) target. Once that audience is maxed out you’ll see performance flat-line and further attempts at optimization will fail.

That’s the death spiral. As you get narrower and narrower your chances of future success reduces in terms of total sales (quantity) even though your success rates will improve (performance) with increasingly diminishing returns. In a chance to make positive changes managers will often get more drastic and over-correct. Then a campaign can go from high-performance to decline very quickly.

The death spiral is not some inescapable event horizon. Sometimes the results are best found through cross-promotion. Sometimes through de-optimization. It depends on your particular situation. That’s where you need D2’s expertise to determine next steps. Reach out to us and we can help you navigate the issues of attribution and contribution modeling to help you better optimize your message and offering to maximize sales and profits. After all, the point is to get the most volume of profitable sales, not just have the highest performing campaign.