As a SEO professional, quite often I am approached by businesses wanting to know which marketing mediums can provide them with the best return on their investment. This is a very good question and in all honesty, there is no simple answer.
There are many reasons why marketing strategies vary in their levels of effectiveness. This can depend on the businesses geographical location, the target market, type of business and so on.
My Journey To Finding Art Classes
Let me give you an example. I like to draw and paint. In actual fact, I think that I am pretty good at it however; I haven’t picked up a paintbrush since I left uni (and without revealing my age, that was quite a number of years ago). A few months ago I decided that perhaps I should find a hobby which would allow me to relax a bit away from the business and the family so I decided to take up art classes.
I was however quite disappointed as I could not find any local art classes in Google, so as many people would do, I put that idea into the back of my head and eventually forgot all about it. Interestingly though, a few weeks later I was throwing out junk mail out of my letterbox when I noticed a small leaflet advertising local art classes. As this leaflet literally fell into my lap, I thought that it was meant to be and joined up.
The Cost Of A Customer
When I arrived at my first session, the instructor (aka business owner) was telling us proudly about the success of the letterbox drop. In all honesty, I thought that it was purely a coincidence that I had actually picked my up so I started asking him more questions about its effectiveness. It turns out; he paid $3500 for the drop. The interesting thing is that he filled six classes with an average of seven students per class. This worked out to be an average acquisition cost of $73 per student. Considering that most students paid around $300 for the course, this drastically reduced the amount of profit made.
The interesting thing is that the business owner never considered online marketing. If it weren’t for the accidental leaflet, I would have never found his business. Considering how few people read junk mail nowadays, I wonder how many others also missed out.
So this brings me back to the point of the effectiveness of various marketing strategies. As I mentioned above, these can vary depending on the type of business you may have, your geographical location, the target market you are attempting to capture and so on. Although there is no set rule, one simple principle applies and that is, to test and measure whatever method you are using.
Effectiveness of Test and Measuring
Testing the effectiveness of a marketing campaign is something that can be very easily introduced into just about any type of business. All that is required is one simple question ‘How did you hear about us?’ This simple question can be asked at any point of the customer interaction.
Whether it’s over the phone, during a physical face-to-face transaction or during an online purchase. The type of information gathered can also be extremely beneficial for example; some businesses may want to capture their client’s postcodes. They may have only targeted certain regions with a marketing campaign so capturing postcodes will easily provide them with a snapshot of the campaigns effectiveness. Other businesses simply ask the question ‘how did you hear about us’. This may help them to understand how much or how little business they are receiving through their phonebook advertising, their website, or any other medium used such as newsletter drops, radio or event TV.
Over the past few months I have recommended capturing this type of data to a few of my clients as I noticed though their website reporting that they were receiving very few hits from a well-known, yet expensive advertising medium. After a couple of months of testing and measuring their marketing dollars, the business owners were extremely surprised with their findings. A few of them realised that the cost of acquisition actually made the strategy unprofitable instead of increasing the businesses bottom line. A number of these businesses dropped this well-known advertising medium and reinvested their funds into more profitable mediums – that predominately being online advertising.
Test And Measure In Everyday Business
So going back to my little experience of art classes… Although using a letterbox drop was overall a profitable experience for the business, highlighting the importance of testing and measuring the effectiveness of a marketing campaign made the business owner rethink his future marketing.
When the instructor asked the class, the majority initially tried to find local classes online without success. Although moving forward he will still continue to use letterbox drops (as it did actually work) he is also going to invest the time in making sure that his website is up to date, that it clearly demonstrates what the business is about and to ensure that it can be easily found online.
The Attractiveness Of Online Marketing
Unlike traditional methods of offline marketing, online marketing allows businesses to track the trends of their potential clients. Using tools such as Google Analytics, businesses are easily able to determine where the potential clients are located, how they are finding your site, what time they are accessing it, which pages they are looking at and for how long and other essential buying patterns. This is why, when tailored correctly, online marketing far outperforms any form of offline marketing.
The bottom line is, whether you chose to use online marketing, offline marketing or a combination of the two, in case you should use every tool available to you to measure its effectiveness.
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