How much should you spend on Marketing?
How do you know how much you should spend on your marketing?
My new mantra for this year is to help businesses grasp the concept that Marketing equals Creativity plus Maths!
Why maths? Because knowing your numbers is absolutely critical and key to your success in business. And there are two numbers in particular that are vital to know, and that very, very few business owners, in my experience, have a full grasp of.
The first one is cost-per-lead. What is it costing you to bring in a lead, an inquiry, a customer through the door? You need to be able to track the results of all your marketing to get an accurate cost-per-lead. It’s one of the two most important measures that I utilise in my business and it’s the same for many, many other super successful businesses.
The second measure is cost-per-sale. Not every lead will turn into a sale. So when you actually make a sale, when a customer buys something from you, what does it cost you in marketing terms to actually make that sale?
Now, of course these two numbers are linked together. Once you do it over time, you’ll see very quickly a certain number of leads are needed to generate a particular sale. These two numbers have high correlation.
But once you understand:
- What you are spending to get a lead for a sale,
- what you can afford to spend to get a lead for a sale
then potentially you put yourself in a hugely-powerful position in your market, because what you’ll often find is that you can afford to spend much more than your competitors realised.
And in any market, in any size, he or she who spends the most, can dominate that market because you can buy greater presence, greater awareness. You can do more to generate interest and inquiries and those inquiries turn into sales.
Believe me, they are two critical and crucially important measures so that’s why my mantra is that Marketing equals creativity plus maths.
Book a call with Rachel to see how I can help you use your numbers to improve your marketing