A Marketing Budget Only Makes Sense When…
A marketing budget only makes sense when you don’t know what ads are pulling and how well they convert. If you know the numbers, you don’t need a budget.
There are many pieces involved in a successful sales funnel. Savvy marketers test every piece in every step in the process so that they know exactly what to expect from their marketing efforts.
After the initial setup and testing, they can tell you the number of sales they expect from every 100 optins to their sales funnel.
You know what your product or service sells for so when you know how many people it takes entering your sales funnel to make a sale then you can calculate whether or not your marketing efforts are generating a positive return on investment.
If you have a positive ROI, you can test in tweak different pieces of the sales funnel to achieve maximum conversions. Once you have a maximum conversion rate in place, a marketing budget is not necessary because you’ll always bring in more revenue than you spend.
For example: If you know that every 100 people that enter your sales funnel is going to result in one sale that makes you $50 more than it cost to get those 100 people into your sales funnel, would you put a limit on how many people you feed into that funnel or would you get as many as you could handle into the funnel?
Would it matter if it cost you $1000, $3000 or $5000 to get those 100 people into your sales funnel if you knew that you were going to get $1050, $3050 or $5050 in return?
This example is extremely unbalanced to prove a point. The point is that you need to know exactly what it is costing you to get people into your sales funnel and exactly how much it’s costing you to make a sale so that you can see how much you are profiting from the process.
Free advertising has a time investment and you need to put a dollar value on your time or you cannot measure it.
Paid advertising has a clearly defined cost so it is easier for most people to track and measure.
Traffic generated by organic means such as SEO and video marketing, etc. is much harder to track. With organic traffic, you need to have Google analytics installed on your web pages or some other analytics program and you need to pay attention to your Web server logs.
You need to use ad tracking links in all advertising done off-site.
If using the phone is an option, call tracking must be used.
You cannot measure what you cannot track and if you cannot measure your efforts you have no idea whether your marketing campaign is successful. If you don’t know your numbers, how do you know if you are building a successful business or working at a different kind of job?
There are multiple ad tracking services on the market and most of the free ones are usually not worth the effort.
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