Where to Put That Extra Dough in Your Marketing Budget

by · March 13, 20134 comments

Recently I was asked by a small business owner a question I’ve heard all too many times, “Hey Jason, I have an extra $1,000 a month in my marketing budget, where should I spend it?” I’m sure most have heard this question, in some amount or other, several times themselves. It’s a pretty common question with a wide-range of responses. After all, there’s no such thing as a marketing magic bullet (Despite what every “expert” under the sun will claim). Everyone’s business is unique enough to warrant its own solution. However, before you use that as an excuse to go running off to throw buckets of money at the newest marketing fad , take a step back and evaluate your current marketing initiatives. Many times the greatest ROI comes not from spending money on something new, but instead by investing in something you’re already doing.

So how do you identify what parts of your marketing initiatives need an investment? Ask yourself the following:

Question 1 – Are you proud of your website?  

Frankly, if you’re not bragging about your website, then it probably sucks. You’re your own litmus test here. If you shudder every time you look at your website in a sales meeting, or constantly end networking conversations with, “For the love of god, please don’t visit our website!” then you need a new website. I understand this might cost a bit more than that extra $1,000 you have lying around. Guess what, I don’t care. Start saving that extra little bit every month and before you know it, you’ll have enough for a new website.

So why is a boast-worthy site so important?  Your website supports almost every single business initiative and department. A well designed website will lift every single marketing campaign your company runs – and newsflash – it’s not just marketing and sales that benefit from a great website. The next time you hear someone in HR complaining that they can’t attract top talent; take a look at the website.  How’s the employment opportunities section looking? If all you have is a couple paragraphs of copy and a few broken links, then it’s no wonder top talent is overlooking your company during their job search.

Keep in mind that there’s a difference between bragging about your website because it’s actually great and bragging about it because you finally got off of that old Weebly template. Do not start bragging about your website just because it was built by someone over the age of 18. Great websites give you actual reasons to boast about the site to your colleagues. These reasons will vary from company-to-company but could include: having an outstanding, responsive design, winning tons of awards, or having an industry leading conversion rate.

Question 2 – Are you split-testing your website?

If you aren’t split-testing (A/B testing) your website, you’re leaving money on the table.

So you have a website that you’re pretty proud of? That’s great! Now tell me what you’re doing to improve it. If you aren’t split-testing (A/B testing) your website, you’re leaving money on the table. Take that extra bit of cash you were going to throw at Generic Demographic Targeter Quarterly and invest it in the resources you need to begin split-testing.

Split-testing allows you to compare two near-identical versions of your site side-by-side to determine which version is better based on actual usage and not because you “just know” customers are going to like the orange button better than the green button. Start by identifying critical portions of your site that you’d like to improve. Is your homepage bounce rate to high? Does your conversion funnel have a high rate of abandonment? These are both problems that you can solve through split-tests.

Don’t feel that you have to split-test your entire site every month. Just start with one page at a time and compare a different element each month. This will help keep costs down and ensure your team isn’t too overwhelmed by all the changes. Remember your website supports everything else you do as a company. It can always be better.

Question 3: Are you closing the conversion loop?

Identify what level of conversion tracking you need and invest the necessary resources.

If you don’t know where your paying customers are coming from, you’ll never be able to make smart marketing decisions. Companies need to close the conversion loop as best they can. How else are you going to know whether or not that new ad in More Sales Monthly was actually worth the investment? Conversion tracking can be as simple as setting up a few goals in Google Analytics. It can also be as complex as implementing a multi-touchpoint, CRM system that will track twelve months or more of an individual’s site visits and purchasing history.  Identify what level of conversion tracking you need and invest the necessary resources. Your ROI on this investment will be every single dollar you save by discontinuing ineffective and inefficient marketing initiatives.

Question 4:  Are you maximizing the marketing channels you’re already using?

Before you go looking for something shiny and new to throw money at, double-check that you have fully exhausted your current marketing initiatives. Every marketing initiative reaches a point of diminishing returns. If you haven’t yet hit that point on any of your current profitable marketing initiative, than you’re walking away from revenue.

Case in point: I had a client that had a profitable, well-managed Google AdWords campaign. For every $1.00 he spent in AdWords he made $3.00 in revenue, more than enough to cover all costs and leave him with a healthy profit. When he asked me about new marketing channels, the first place I looked was at this Google AdWords campaign.   Sure enough, I found he was nowhere near reaching his performance peak. After pointing this out he invested his extra $1,500 a month back into AdWords. Sure it wasn’t the sexy new channel he was originally looking for, but it was a guaranteed $4,500 a month in revenue.  Now he’s able to put even more funds towards testing new marketing channels.

Question 5: Are you remarketing?

Remarketing enhances almost every single marketing initiative you have.

Sure if you’re not already doing it, remarketing is technically a new opportunity. For those that aren’t aware of it, remarketing is a marketing tactic that allows you to retarget individuals that visit one of your digital marketing platforms (website, landing page, etc…). You can remarket across a variety of networks, from Google to Facebook and everything in between.

The reason I urge companies to consider remarketing over any other new initiatives is simple. Remarketing enhances almost every single marketing initiative you have. From sales meetings to social media postings, remarketing allows you to extend the impact of your brand at a fairly low cost.

So what does this mean for you?

Scenario 1 (no remarketing)

Background: Client came to your website after clicking on an awesome piece of marketing collateral
Individualized cost to produce that content: $4.00 (Content Cost/Impact )
Cost of initial site visit: $4
Total site visits: 1
Average cost of site visit: $4

Scenario 2 (remarketing)

Background: Client came to your website after clicking on the same awesome piece of marketing collateral as Scenario 1
Individualized cost to produce that content: $4.00 (Content Cost/Impact )
Cost of initial site visit: $4
Individualized cost of remarketing efforts: $3.50 (CPC/CPM Costs of Two Ad clicks)
Total site visits: 3
Average cost of site visit: $2.50

Chances are that a visitor isn’t going to convert the first time they come to your site. Depending on your product or service,  it could very easily take between 2 – 10 visits (if not more) before an individual converts. With remarketing, you not only remind customers about your company, you also provide them with a low cost way to come back to your site. The lower your average costs per site visit is, the more visitors you are able to drive to your site with the same budget.

Question 6 – So, am I ready to identify new opportunities? 

Well let’s go through the checklist:

  • Are you proud of your website?
  • Are you split-testing your website?
  • Are you closing your conversion loop?
  • Are you maximizing your current marketing initiatives?
  • Are you using remarketing techniques?

If the answer to all of those questions is, “Yes!” then congratulations, time for you to test out a couple of new initiatives. Need a place to start? Create a list of all your owned, earned and paid initiatives. If one of those lists are considerably lighter than the other (say you’re investing a ton in paid media, but nothing in blog content creation), then consider filling that hole your first priority.

At the end of the day, what you choose to do with that newly budgeted cash is up to you. My advice, go after the guaranteed returns (use this list as a guide). It won’t take long to turn that extra $1k a month into an extra $5k a month. Then you can afford to buy all the magic bullets you want.

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About Jason Spooner

Jason Spooner

Jason Spooner is the Director of Client Services for SME Digital, the digital marketing extension of Social Media Explorer. During his career as a digital strategist, Jason has worked with a variety of large and small companies including: NAPA AUTO PARTS, NASCAR, Kraft, Wal-Mart and Wrangler. His passion: creating powerful digital marketing strategies that drive results. Oh, and he does improv comedy. Follow his antics @jaspooner.

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