Written By: Scott Price, Skyline New Jersey
There are times when the growth in your spending will outpace the growth of your revenue. This is certainly common among start-ups, but it also applies when you’re expanding into new markets or product/service areas, undergoing an economic downturn, or if you’ve just become a little lackadaisical in managing aspects of your budget.
Since you need to “spend money to make money,” you want to be careful never to cut marketing efforts in a way that will hamper your business’ ability to grow. But if your promotional expenses have never been clearly tied to strategic goals, if your marketing efforts are out of sync with sales priorities, or you’re not getting an effective ROI on your expenditures, then it’s time to reexamine where and how you’re spending your marketing and advertising dollars.
FIRST, MEASURE EVERYTHING
Your key performance indicators (KPIs) will vary depending on your marketing goals. Sales and leads are some of the most obvious KPIs to track. But if you’ve had concurrent goals related to brand awareness, engagement, customer loyalty, etc., then you need to have unique defined KPIs to help you monitor performance. These KPIs might be social media mentions, website referral traffic, traffic from your branded search campaigns, etc. The critical thing is to have those measurements in place. Without a clearly defined KPI, you can’t defend the necessity of any marketing or advertising campaign.
OPTIMIZE RATHER THAN REDUCE
It can be tempting to make across-the-board cuts to marketing budgets. But this can lead to reduced sales and leads, and missed “fire sale” promotional opportunities. Look at which campaigns are generating good ROIs, and consider shifting your spend there. If you’re a department in a larger organization, retaining your budget this way is often easier than having to later go back and ask higher-ups to rescind a previous year’s cut. And in all cases, it can allow you to continue to grow your business during economic downturns, while your competitors are actually reducing their visibility. You’ll end up enjoying much better market share and brand awareness after the economy improves.
SHIFT DOLLARS TOWARD TRUE CONVERSIONS
SHIFT DOLLARS TOWARD TRUE CONVERSIONS
If you’ve been focusing your spend on generating site traffic, you might want to shift more of that toward lead generation instead. Or, if prior marketing efforts already generated a lot of leads, you may want to focus on nurturing them, rather than on generating new leads.
But if all these efforts seem to result in nothing but non-converting prospects, it may be time to put more focus on cross-selling or upselling your existing customers. The standard cost comparison between a new customer and and old one is five times the expense, so it often makes sense to spend the bulk of your marketing dollars regularly targeting your best customers, rather than prospecting widely.
FOCUS ON EMAIL AND SOCIAL
Targeted email marketing typically provides more measurability than a brand-awareness campaign, and can be done at a comparatively lower cost. But be careful not to badger your list members too much less you risk fewer email-opens or even dropped subscribers. Instead, segment your audience, personalize your messaging, and think of innovative ways to reward your best customers for their loyalty.
Similarly, social media offers many opportunities when your own budget – or the industry’s – is tightening. In comparison to other marketing outlets, social media allows you to reach a large number of people organically or through low-cost promotions. In turn, budget-conscious buyers often turn to social media for peer recommendations before making purchasing decisions, so social media is a great place to be when everyone else is feeling an economic pinch. Social platforms also become a defacto meeting place when personal or business travel budgets have been cut, providing the social marketer with a growing audience when attendance elsewhere is seemingly shrinking.
OUTSOURCE SOME WORK
Outsourcing some of your marketing tasks can have a dramatic effect on your bottom line, converting some of your highest, fixed payroll costs into variable costs. Outsourcing also allows you to focus more of your energy on generating sales and leads rather than scrambling to find tasks to keep your internal staff busy.
AUTOMATE YOUR MARKETING
If you are still not using marketing automation software, you’re wasting valuable staff time doing something that software can do on your behalf. Marketing automation lets you send instant thank you notes to prospects from the trade show floor, reiterate your value proposition, and engage prospects with links to site materials that support your trade show message. After that, it’s an easy matter to use it to schedule “ drip campaigns,” nurturing segments of your list with custom case studies, white papers, webinars, exclusive offers and more.
Cutting the fat from your trade show marketing budget doesn’t necessarily have to reduce your visibility to a shadow of its former self. Through smart budget reallocation, outsourcing and automation, you can optimize your marketing and ad spend in a way that will find you accomplishing more with less.