It’s no longer “been there, done that”, according to an article published today in The McKinsey Quarterly, the business journal of McKinsey & Company.

“The old recession playbook won’t work this time around” writes the author, David Court. And “those who follow the survival techniques of past slowdowns risk betting on the wrong markets, customers, advertising vehicles, or sales approaches.”

Now I am paying attention.

In this excellent analysis, the author tells us that this time, the old “doubling down” on large, historically profitable customers, geographies, and market segments will be ineffective.

Also, emphasizing again traditional media (i.e., television and newspaper ads), while cutting back on new advertising vehicles will not work either.

What marketers need to do instead is “toss out those historical expectations and focus on the emerging pockets of customer profitability” by:

1. Identifying anew who and where the profitable customers are, and

2. Using effectiveness to prioritize marketing and sales vehicles for reaching them

This means that marketing and sales executives must re-prioritize geographic markets and customer segments “at every shift of economic fortune.” And marketers with access to micromarket data have even more opportunities to enhance profitability.

Also, marketers must prioritize advertising vehicles based on better understanding of the effectiveness of different forms of advertising than many marketers have today.

In other words, only by looking at the conversion rate (i.e., the effectiveness of different forms of advertising) by micromarket will marketers know how much to invest on each tactic and each market.

Marketers “who assume the reach and cost of a vehicle serve as a proxy for its effectiveness, ignore the vehicle’s quality—that is, its ability to influence customers.”

Yes, in the end, only the sales conversion rate matters when assessing the value of the tactic (the article provides insights on how to do this even for the ‘least measurable’ of media).

In other words, from an online conversion rate optimization perspective, companies can maximize profitability by “focusing on micromarkets less sensitive to prices while also offering discounts or preferential pricing elsewhere to drive sales volumes.”

You can accomplish this by creating separate and distinct campaigns driving to different landing pages where you can test out not just layouts and creative, but the complete value proposition, as well as pricing offers.