Why Marketing Is So Hard

This was a post that appeared in the Inbound Hub area of Hubspot, and it had some useful metrics to appraise your marketing program:

But, the article didn’t do anything to suggest what you could do about these distressing stats, so here are our ideas:

For every 1,000 Qualified Prospects you touch:

*40% will not buy anything;

*300 will buy from some vendor in six months;

*200 will buy will buy from some vendor in 6-12 months;

*100 will buy from some vendor in more than 12 months.

Which means that 60% of your marketing dollars are wasted….the total percentage of those who won’t buy in six months. What  can you do to up the percentage?

1. Take a look at your competitive posture. Are you in a perceived unique niche? If not, your advertising might be helping your market leader succeed.

2. What’s your acquisition cost per customer? One of our clients knows that it costs him $129 to acquire a customer that might yield about $5,000 over the customer’s life span. The cost should also include reminder advertising, but if you want to look at lifetime costs vs. lifetime revenues, that’s the better way.

3. Another way to look at acquisition cost is to say that it shouldn’t normally (startups are the exception)  be more than 15% of your selling price. This cost includes all forms of promotion for marketing, which includes selling expenses, such as salaries, commissions, print and web advertising, etc. Web promotion expenses are also included. So, if you’re spending $150/month on SEO, you better be averaging $1,000 per month in web-originated sales.

4. Is your staff annoying customers during the acquisition period? Does your web site, or do your CSRs do follow-up calls on the customers to find WHY they didn’t buy from you?

5. If you get your market position right, the sales costs will be less, and your customer acquisition costs will go down. This isn’t news: we had a marketing prof at the Wharton school tell us the same thing a few years ago.

6. You’ve got to put social media marketing in these same metrics. What social media would influence more customers to buy from you now?

So, marketing need not be hard, or expensive, but getting to where it isn’t might be both.

This entry was posted in Entrepreneurship, guerilla marketing, Internet Marketing, Marketing, Sales and tagged , , . Bookmark the permalink.

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