Thinking about cutting your marketing until times get better? Don’t do it!

Let’s get the elephant out of the room: the world is crazy right now. Everything is shifting, there seems to be a new crisis every day, and there’s a lot of fear in the small business world.

And while I totally get that, what I don’t like seeing is people using this as a reason to cut back on their marketing efforts. While everyone is (naturally) trying to do more with less, and save any little extra space in the budget they can, marketing is not what you want to cut. 

Many people think marketing should be the first thing to go when you start making budget cuts. This couldn’t be more wrong.

If you’re getting fewer leads and fewer sales, the answer isn’t to stop doing the thing that brings you leads and sales. That sounds so obvious when I write it, but so many people do this.  I feel like I just need to reiterate: don’t cut your marketing. Now, this doesn’t necessarily mean that you need to spend more on your marketing ... but it does mean that you need to be smarter and more intentional about it, so you can make sure you’re getting the best possible return on your investment of time and money.

Start by evaluating your marketing dollars with a review of your Customers’ Lifetime Value

So, it makes sense that you’d rather get 5 really perfect, high paying customers than 10 not-so-great, really low-paying ones, right? And then, you can see how to make that happen, you’d want to target your marketing to focus on the great customers. But so many people just take a scattershot approach to their marketing, focusing equally on all segments of their audience. Obviously, this can work if you’ve got money and time to burn, but we’re focused on best returns right now, so you’ll want to shift your marketing to focus on acquiring your best customers.

How do you do that? Well, first you have to figure out who they are. And the way you do that is by looking at their Customer Lifetime Value (or CLV). That’s a fancy way of saying “how much you’re likely to earn from them over time.” The easiest way to figure this out is to average the value of their purchases by the number of times they’re likely to buy. The higher the CLV, the more you’re going to want to focus your ad spend on them.

Now think about how you got here.

OK, you know who to focus on now ... but how do you go about marketing to them? Well, you’ve clearly done something right to book them. So circle back and look at your process with an outsider’s view. What did you do that led to them booking with you? See if there are elements you can replicate to attract more of the same. One great tip here, by the way—ask your current clients what language in your marketing really appealed to them. Chances are, it’ll also appeal to the next batch!

Work in reality.

This is such an important lesson, but such a hard one to learn. It’s really easy to create marketing plans in a vacuum, but reality is something totally different. You or your company’s leadership needs to sit down and do a reality check of your marketing plan, and make sure it’s actually designed to work with the realities of your market.

For example, I had a client who worked in three main verticals. He designed a marketing plan to appeal to all three, which makes sense on paper. However, he made 65-75% of his revenue from just one of those verticals. So, even though he liked focusing on all three, we shifted his plan to focus primarily on the one that was the most profitable.

So, as you can see, nothing super complicated ... but it can be harder than you think to get enough perspective to make useful changes here.

That’s where I come in. 

I closely collaborate with my clients to develop a customized, strategic approach to marketing that is both sustainable and works for their business. Interested? Get in touch!