Position Marketing as An Investment, Not a Cost
I get it – marketing seems like just another expense, yet another line item in your business’ budget that thins your profit margin.
However, It doesn’t have to be this way. By working smarter – not harder – on your marketing, you can make turn your marketing budget into a revenue generator for your business.
How? By following one simple rule:
Position Marketing as An Investment
Think of it this way: if you invest $50,000 in a marketing campaign that generates $500,000 for your business, it doesn’t go in the books as an expense; it goes in as profit. That’s the power of a strategic marketing approach.
The simplest way to see the results of your marketing efforts is to make sure you are tracking where your customers are coming from. This can be done using the many technical platforms available today such as Google Analytics, or you can rely on asking your customers a good old-fashioned question: “Where did you hear about us?”
Knowing where your customers are coming from will allow you to make educated decisions about where to invest your marketing dollars. These educated decisions are the foundation of Footeprint’s marketing efforts on behalf of our clients. We focus on making a direct effort to generate leads that can be tracked, measured and delivered to our clients as proven ROI.
Once we’ve established your clientele and revenue goals, we’ll work to define your return on marketing investment using the following formulas:
- Cost Per Lead = Marketing Investment / Number of Leads
- Conversion Rate = total number of leads/ total new clients
- Leads x Conversion rate = Number of New Clients
- Return on Marketing Investment = (Number of New Clients x New Client Value) – Investment
Still Not Sold on The Importance of Marketing?
It’s important to realize that there is a cost to doing nothing. Marketing can maintain or improve your position in the marketplace, which has great value to your business. As competition increases and the market reaches saturation, you’ll have to invest in marketing to achieve the same level of performance or growth.
Take Coca-Cola for example. Everyone knows of them and has drank a soda. They may have reached market saturation, but they maintain their brand advocates and consumers in the market by continuing to invest in marketing. Through ongoing campaigns, Coca-Cola stays at the forefront of consumers minds while developing a strong brand loyalty. This strong brand loyalty has developed into a group of lifelong consumers who add value to Coca-Cola not only through their continual purchases, but also through their referrals and endorsements. In the end, as proven by various blind taste tests, consumers don’t buy Coca-Cola because of the brand’s taste. The company has developed into a leader because of the positive associations consumers have learned to make with the drink, all as a result of marketing.
The lesson to take away from Coca-Cola? Never take your marketing efforts for granted by simply using what’s left over after expenses. Position your marketing as an investment and start generating revenue for your business.