Where will you get the most return for your marketing spend?
How do you know where to spend your hard-earned cash on marketing? With so many new channels and options, how do you know what will deliver the best results?
How your marketing budget is spent can seem as scientific as blowing seeds into the wind. Too often, the overwhelming marketing options available result in a scattershot approach that turns marketing into something seen as a cost, as something optional.
But marketing isn’t like blowing seeds into the wind.
When it is done properly, it is a discipline, a science. Crunching the numbers might not be as sexy as unveiling a new ad campaign, but it is where your marketing efforts succeed or fail.
Good marketers know this, because if they can’t prove it’s working, how can they justify their budgets? Marketers have always measured, learned, adapted and optimized their activities and campaigns. Of course, in the past it was more difficult—how do you measure the success of an editorial in a magazine? Can it really be justified by the rather fuzzy notion of “brand building”?
Track marketing spend
The prevailing logic once was that the campaign was working if sales increased. But there are limitations to that, of course. If you run an ad campaign for ice cream in June, did sales increase because of the campaign or because the weather got warmer?
Coupons were one solution to track which sales were directly inspired by a campaign. But coupons weren’t suitable for everything; how do they square with the values of a luxury brand? And how do you know that the purchaser wouldn’t have made the purchase anyway?
These problems are less of a concern to the marketer of today; digital channels promise a more scientific approach. We can track views, open rates, click throughs—right through to purchase.
It’s a scientific marketer’s dream: assigning value to each view, each new customer, each purchase. If we can calculate return on investment (ROI) so precisely, we can channel funding to marketing tactics that deliver the greatest ROI: test, measure, adapt, test again, measure, adapt, cancel or optimize.
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The biggest benefit? You can get digital space for a tiny fraction of the cost of traditional media. Early adopters who dominated their chosen fields online saw big rewards for small investments.
For those trying to build a brand online today, it is a different story. Monetization is the watch-word of the web these days.
Cost optimization is undermined by the growing costs of getting your name heard online and the need to use services like AdWords and Facebook ads. There are other costs too: SEO and tech experts don’t come cheap. So how can we be sure that our online activity is still offering better value than traditional channels?
We’re back to the tricky issue of measurement again. Integrated campaigns, web codes, and highly personalized digital printing are opening up new possibilities for measuring offline activity, enabling us to apply our digital analytical skills to traditional channels.
According to Entrepreneur.com:
Every dollar and every minute spent on marketing should communicate the same message. That includes accounts that have never been used for paid campaigns such as Instagram or, in some cases, Pinterest and Twitter. In business time is money. Therefore, social media accounts and similar branding efforts are never free and should be seen similarly to paid marketing solutions, such as print collateral and paid online advertising campaigns.
Test, measure and adapt
The only way to answer the question, “Where will I get most return for my marketing spend?” is our old favorite: Find out where your customers are, then test – measure – adapt – test – measure – adapt / cancel / optimize…
The answer will be different for everyone. Digital advertising costs differ by industry, as do conversion rates. But if you take a disciplined, scientific approach, you will find the answer that is right for you.