What is the value of marketing to your business?
Let’s take an example from digital marketing, since that’s where it’s at. A client in the B2B space approached me with a simple ask: I need a website.
To have a digital presence that the sales team can use to drive traffic to after their client meetings.
Fair enough. My client needed a website as a follow-up tool to help convert clients. There was no percentage increase in sales that the website would be expected to yield (no goal), so it was important to learn who the website would be targeted to – customers who would spend upward of $50,000 per order. They also wanted to see if leads they had already identified as key clients were visiting the website, so a CRM-powered website was a must.
My client assumed customers would visit this website to find more information on topics covered during the meeting, and to learn more about the company.
Unfortunately, consumer behaviour studies who that we use websites differently today. Historically, we used to find suppliers and vendors by searching for them like in a phone book. Now, we follow conversations on the topics we’re interested in, and discover partners we want to work with through blogs and thoughtful content.
What was the timeline? Yesterday – as always.
With that information in hand, I tabled a solution that would see their website live, up and running in three-months time, backed by a CMS that was easy for them to maintain, a CRM that would integrate with their existing sales CRM to show who was looking at the website and what exactly they were viewing, and a great start for their ABM efforts.
If you’re lost in the acronyms – here’s a crash course.
Everything would be measurable and we could track the effectiveness of the website as we go. All this would cost the company about $18,000 per year to maintain.
SAY WHAT?! That’s a lot of money.
Here’s the thing – websites are now digital sales people and lead generators, not just ways to mark the company’s territory.
Let’s rephrase. If you paid someone $18,000 per year to go out and get you clients worth at least $50,000, would you do it? Absolutely. If they sign only 1 client in that year with that minimum spend, you’re ahead.
That math seems too simple…
You’re absolutely right. I’m looking at gross profit. That $50,000 breaks down in your Cost of Goods Sold (cost to operate), your expenses and your actual profit is perhaps 45% of that. It can be higher if you’re running leaner, but even so, that leaves you with $22,500. With one transaction you have paid off your annual marketing spend for your website.
Marketing is an investment. Looking at marketing dollar for dollar will not yield results or make any financial sense. Make sure you choose marketing tools that are measurable and makes the bottom line impact that you’re after.
Why Marketing is a marketing consultancy who helps small & medium sized businesses set up a sustainable, scalable, efficient and effective marketing function. The primary goal is to empower entrepreneurs to own their brand. Founder Elena Parial is a Senior Marketing Consultant with over 15 years of B2B, B2C and corporate marketing experience. Being industry-fluid allows her to bring successful strategies to clients who need to look at their marketing differently.