Marketing Right: Knowing When to Increase Spend
Spending and saving are a touchy issue with the limited budget of any company. It’s hard to know when it’s best to hold on tight to your limited marketing funds, or really spend on a good investment; one that will ROI, and grow your business quickly and effectively. While it may seem like it’s just anyone’s best guess on where to splurge, and where to pinch pennies – there are some apparent signs, both good and bad, for any marketing medium – that will tell you if it looks like a good idea. Take a look at this article, and you’ll get some usable tips on when it’s best to increase your spend, and market to grow your business.
Mapping Your Marketing: Start to Finish
With any marketing campaign, you need to work backwards with your spend. This means, you have to decide how many customers / orders you’re hoping to get, and how much you’re willing to pay for them. What you’re willing to pay for a new customer is known as your “Customer Acquisition Cost” or “CAC” for short. Determining a profitable CAC isn’t just about turning a profit on that sale alone, it’s also about analyzing the spending habits of the majority of new customers you do acquire, over time. If you’ve found that you make your money back within a year of acquiring a new customer, and then statistically, they stay loyal for 3 – 5 years after that – you can afford to spend quite a bit on them.
When you’ve figured out how much you can afford for your CAC in a given marketing campaign, it’s time to think about how many new customers you need. If the campaign can return the needed number of customers at, or under, the determined CAC – it’s probably a good place to increase spend, and get more customers. If it doesn’t look like it fits the mapping and research you’ve done, don’t let your valuable budget go toward something that won’t work out.
Signs of a Good Marketing Campaign
A good marketing campaign isn’t just well presented – it’s well thought out, and well executed. Don’t be fooled by ‘smoke and mirrors’ style sales pitches that have a lot of success metrics that can’t be backed up. A great way to see the opposite of this, and a sign of good marketing campaigns / products – is the exhibition of “case studies.” Case studies are detailed reviews of what a marketing company has been able to do for other clients, preferably similar to your business – serving as good and relevant evidence that they can do the same thing for you.
It can be hard to feel like you can trust a company when you don’t know anything about the, or even who they are. Have they offered you many different contacts during the process – that’s not good. On the other hand, if you’re vendor has supplied a single contact throughout the sales process, even sending you physical materials like printed business cards – this is an excellent sign that they’re probably a good vendor to run your next campaign – and a good place to spend your marketing dollars.
Execution: Succeeding at your next Marketing Campaign
When you’ve gotten all of your ducks in a row for your next marketing launch, you may think the hard work is over: just launch away with your next campaign, and let the new customers roll in. Well – that is about as wrong as you can be. If you haven’t assigned systems of intermittent reporting, and assigned dedicated managers to be responsible for all of those unique liabilities, all of your hard work and research could fail – and you could lose all of the investment you’ve set aside for this campaigns. Even if you’ve done quite a bit of preparation, and have some good systems in place, if you haven’t paid any money already – and you don’t feel you have the best execution details in place – by all means, pull out and don’t end up wasting the money you don’t have to waste.
Deciding when it’s good to increase your spend on marketing campaigns is a complicated process – but with diligence, you can definitely find worthy outlets. Take the time to research what you can spend, how you’ll spend it, and how you’ll execute the campaigns. This simple process will take you from an ambiguous cycle of wasted marketing dollars, to a targeted process that grows your business and get’s you results!