Often when it comes to marketing, many succumb to "hoping" to build their brand through widely distributed, "feel good" and "clever" campaigns. More often than not, this results in spending a lot of money, without ever knowing if a single dollar was worth spending. It's a horrible standard to run marketing by, but unfortunately, many fall into the trap of marketing like mega corporations who have millions to toss around. Chances are, if you spend $1.00 on marketing, you're wondering when you're going to get that $1.00 back, and hopefully it will be more like $1.25, or even $2.00! But ROI driven marketing doesn't rely on "thinking" things are working. It looks to make decisions based on numbers. With that in mind, let's a take a look at two different approaches: The difference between that two is that one is a shot in the dark "Maybe this will work, but I'll never know for sure!" Versus the second option, where you will know with certainty whether a specific campaign is worth investing more money into. Even if you continue to run an unprofitable campaign, you can tweak specific parts of it until it becomes profitable (which is often the case). So for example, let's say you spend $5,000 one a new campaign. Since you are now measuring every step below, here's what it looks like. Now for $5,000 you won 2 new clients. Let's say each client purchased an individual tax return, for $250.00 $500.00 upfront, so year 1 would bring in $500.00. Over the course of 5 years, that's $2500.00. Which is not only Not Profitable, it takes a long time to even recoup 50%! So what can we do? Here are some questions you can now ask with this data:
- Are we targeting the right audience? Only 57 out of 1000 responded...
- Do we have a compelling reason for them to respond? How can we improve it so 57 can increase to 100+?
- Can we do a better job of engaging? 10 out 57 might seem low, why not shoot for 15 or 20 out of 57, which should lead to 7.5-10 meetings, and 4 new clients.
- Can we sell additional services to those who come on board, so instead of a average transaction size of $250.00, how can we add value to the offer to increase price or additional options?
- Basic: $300.00, includes initial consult and follow-up report
- Silver: $500.00, includes initial consult plus 1 tax planning session.
- Gold: $800, everything above plus 2 tax planning strategy sessions throughout the year