One of the best ways to look at your marketing expenditures is how effective is each marketing dollar?
Does it feel like you are throwing your money into a black hole of lost business capital? Often this is the case, in the past some companies were so small I would advise them against using Google Ads. Why spend money if you aren’t getting anything back in return?
This brings us to an important part of what you are doing, what is your goal with your marketing dollar? Are you looking to sell more products or services, more digital downloads or just overall exposure? Each of them can be hard to quantify exactly how effective they are, so having solid metrics is a huge part of tracking where your marketing dollars are best spent.
One method you can deploy is called A/B testing. We will try one thing and see how it performs, and then we will try another thing. This can be useful for testing conversions with one landing page design versus another, testing conversions with one ads title and text versus another, and more.
With marketing dollars, you also may track your conversions by other metrics such as by YouTube views, in case you are marketing your videos that have ads – you can track traffic and ‘goals’ to see how your marketing dollars are doing. With email marketing for example, it would be how many times did a person open the email, how many times did they click on it, how many unique views and total pageviews did the page get? Most importantly, how many conversions occurred. You can also tell if the marketing list you are using is not so great, and if you purchased it from somewhere – not to buy from them again.
The main, most basic way to measure your marketing performance is looking at your “cost-per-acquisition” or the cost to acquire a paying customer. To do this one looks at how much money you spent on a campaign, and measure precisely how many conversions took place ( whether it’s to buy a product or register for a newsletter or watch a video ). If I spent $1000 on a marketing campaign, and 50 people converted to a customer or lead, then I know that my cost per acquiring each of those customers was $20 each on average. Now if the service or product you are offering costs $15, each sale provides you with a profit of $5 dollar for example. The math becomes is 50 sales at a CPA of $20 each, times a profit of $5 each, for $250 in profit after spending $1000. You will have netted $1250 and grossed $250 in profit. This means you have had a successful marketing campaign in the most basic of ways. If your marketing team is serious, you can scale that up and simply spend $5000 for an average return again of $5 per converted customer. If the math stayed the same, then the profit or ROI would be ( in theory ) 5x more, or $1250 in profit after spending $5000.
Some niches will provide higher profit margins. You may already know which of your services has the highest profit for you, so you may want to consider marketing to that niche. A recent client of ours spent a good amount with Google and with our strategic campaign management, they made 2.43 times their investment, or an ROI or a 243% return – in one month. This is after a few months of fine tuning and adjustments to their website for increasing conversions – but now it is a how much do you want to spend game because we have ironed out a positive, real ROI money-making machine.
We offer superior marketing services with Google Ads and Facebook Ads. Starting with a comprehensive analysis of your situation and the visibility of your competitors across the marketing ads spectrum. We can find out which keywords your competitors are using, how much they are spending total, how much they are spending per keyword and more. This allows us to bid just under what they are, or just over depending on the situation – to further increase the ad conversion rate and ultimately marketing dollar ROI. So keep your eyes on your metrics, be sure you are tracking them properly and squeeze the most out of every drop of marketing dollar. I hope you enjoyed this article!