3 Tips for Managing your Marketing Campaigns
Small business marketing is one of the harder things to do in a small business, especially when you’re trying to compete against big corporations with much bigger budgets for consumers’ attentions. But you still have the potential to fight back and grow your small business into an empire through smart marketing. Here are a few ways to improve your marketing campaigns:
1. Allocate Bigger Budgets
Based on the lifetime value of your customer and payback periods, you can usually compute a higher target cost for acquiring a customer. To simplify all the technical speak, what I mean is you don’t have to think about only affording $50 for marketing to close one customer if your gross profit is $50 on an average order which is $100. If you know that customer will come back and purchase one-month later, you now have up to $100 to spend in closing that one sale because that initial loss will pay for itself within the next month. If your customers generally come back and purchase 4 times in a 6 month period, you can allocate $200 to acquire one customer with a payback period of 6 months and anything after that is profit. Calculating budgets like this will allow you to allocate larger budgets so now you can compete with the big boys in marketing.
2. Think about Conversion Rate Optimization
Did you know you could double your revenue without doubling your costs? It’s certainly not an easy task sometimes, but focusing on conversion rate optimization can be one of the more profitable things you do as a marketer. Cleaning up your sales funnel to convert more customers are a higher rate is incredibly useful because once you increase your conversions, you can do the same amount of marketing, but always get better sales than before. This is the smart marketer’s way to more revenue and more profit without increasing costs.
3. Double-down on What’s Working
If you see something that’s working, spend more time and energy on improving and scaling those channels because you’ll be much more efficient in those efforts than if you were to spend more time and money playing with marketing channels that aren’t working well. If you know something works and you can scale it, spend more time doing so until you’ve reached that channel’s full potential, then explore new areas for growth.
Danny Wong is the Brand Manager for Blank Label Group, working with the startups Blank Label, Thread Tradition and RE:custom. Danny also blogs at HuffingtonPost, TheNextWeb and ReadWriteWeb.
March 30th, 2011 at 2:35 pm
Nice post, Danny!
I agree with what you are saying. Lifetime value is a big factor in overall ROI and conversion rate is key. If you can afford it, testing dozens of channels and then circling back to scale the effective ones is a great way to double-down, as you put it.
March 30th, 2011 at 5:42 pm
I totally agree! LTV is often overlooked and when you consider it costs 5-7 times more to get a new client than retain a current client, it just makes sense!
Mike Saunders, MBA
Author of: “The PRISM Salvation-a 3-Step Solution to Social Media Domination for Busy Business Owners”
Available on Amazon.
Get the 1st Chapter here:
http://www.ThePrismSalvation.com
March 31st, 2011 at 9:05 pm
Your advice to double-down with what works is especially important with the number of potential channels exploding. Nice post.
April 4th, 2011 at 2:46 pm
As a marketing student, I have learned that many marketing strategies are now online, or primarily based around technology. It is also important to maintain a customer database of all of the clients that are most important to your business. There are many technology specialists who are there to help businesses stay ahead of the game. I am hoping to start my own business, probably a consulting company, and am so happy that blogs like this exist to give me guidance! Thanks for the great blog!