As interest rates rise, an economic downturn is on the mind of our industry. After a period of price increases, executives are looking for alternate methods to maintain profit margins. A refined focus on advertising and marketing strategies can provide long-term savings that fall right to your bottom line.
The 19th Century retailer, John Wanamaker, famously stated, “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.” Data and analytics can challenge the status quo, revealing which areas should get more or less of the budget.
Resist Cutting Budgets
The reality is that a business must understand the results of advertising and marketing campaigns, and focus on the lucrative initiatives all the time. Instead of cutting costs by slashing budgets by a fixed percentage, delve into the metrics with an educational mindset.
The first step is to put on your CFO and CMO hat and see where the ideal results reside. Focus more narrowly on the most profitable segments of your efforts. If costs are still a concern, a business can look to reduce advertising frequency for a period of time, but should not cease marketing and advertising. Companies that have bounced back most strongly from previous recessions usually did not cut their marketing spend, and in many cases actually increased it.
Start with a Review
The most important question you can ask customers is, “How did you find us?” Gathering information provides the guidance for where marketing and advertising dollars should
Consider the total investment of management, time and dollars spent. Armed with that information, look at all aspects of your marketing costs with a detailed review of the time and money spent on each initiative. Delve into the details at a granular level; for example, you may find digital advertising on Bing search engines brings more qualified customers than Google. Are your ideal clients primarily on Instagram or LinkedIn? What email topics garner the most attention?
- How do customers find you?
- What search engine platform is most lucrative in converting paid advertising leads?
- What social media platforms provide sales conversions?
- What print publications provide the most exposure to your target customers?
- What email topics provide the most engagement?
Ramp up the methods that work
Every business has success stories. Pour more energy into the initiatives that have worked in the past and reduce other practices that are speculative or non-performing. Reward customers for buying more instead of putting in place across-the-board reductions or price increases. Loyalty goes a long way during difficult times. Offer your best customers selective incentives to keep them returning.
Trade show success rates can vary greatly depending on their location and size. Calculate the number of successful clients reaped from the show multiplied by their sales. Does the cost versus benefit justify the show? Would you be better served flying target clients in for a site visit and a memorable one-on one experience? Would you be better served in an alternative booth size or booth placement? Can you partner with other exhibitors and share in the expense? Does the geographical location of the show impact your success? Are trade shows too important for your brand to miss out? Take a long, hard look at the reason you participate and the results.
- Calculate booth visitors by geography of show.
- Calculate booth visitors by in-show booth placement.
- Calculate conversion rate and value of conversion.
Evaluate your social media efforts to understand where your main target audience primarily interacts. Social media platforms can get tricky due to the extensive algorithmic changes that have taken place in 2022. Meta (Facebook and Instagram) is updating their focus feed to favor video and “Reels” to counteract the audience they are losing to TikTok. At the Meta second quarter shareholder meeting, it was announced that the user feeds will now be including 15% new people to users’ feeds (not just people you currently follow). The percentage will increase up to 30% throughout the balance of 2022. By simply posting video on Meta, you open up to a new audience – free of charge. If you are gaining quality customers via Instagram and Facebook, your videos put you in a good position to increase your brand visibility and sales.
For the manufacturing industry that relies on sales representatives to introduce new products or programs, reinforcing sales reps’ messaging with social media posts and email updates is a win-win for all. Take time to review your audiences for Meta advertising to further refine your demographic settings. This will ensure the spend is hitting the audiences that respond to your posting.
LinkedIn is known for its “golden hour” – the first hour a post is visible. The engagement of a post in the first hour has a notable effect on the effectiveness of the post thereafter. By encouraging interaction in the first hour, you gain tremendous momentum. Providing content that is valuable to LinkedIn and keeps members on the site is also rewarded. Consider writing a LinkedIn newsletter to expand your visibility. So, what’s the difference between an article and a LinkedIn newsletter? The main difference is, when you publish an article, it goes into your timeline. Your connections only discover it by scrolling through their feed. When you publish a newsletter, your subscribers get notified, which increases the chances of people seeing and consuming your content. Best of all, it is a free service on LinkedIn!
- Focus on social platforms that have your customers attention.
- Review the audiences on Meta to target the successful demographic.
- Create videos for Meta platforms.
- Share new items and company notifications on all platforms.
- Create LinkedIn newsletters.
Reading a magazine is a different experience from digital, website and social. Nothing beats a cup of coffee in the morning and the tactile experience of turning the pages. Magazine subscriptions provide staying power for your brand in a unique way on coffee tables and in waiting rooms. Magazines have limited pages, and your brand is less likely to get lost in the noise of a social media feed. Make a unique call to action in the ad to track your successes. Check with your publisher if they offer targeted placement to subscription-only readers. By doing so, you can grow your business in select markets by showing your ads only to specific regions. The ads do not appear in the newsstand magazines using this targeted method; however, the cost savings are significant. In addition, many magazines offer alternate placement, including emails, and banner ads on their website for a cost-effective brand placement option.
- Place unique call to actions to track success.
- Contact the publisher for targeted marketing placement.
- Consider digital marketing opportunities for printed publications to expand your brand.
- Prior Customer contact
A repeat customer is the best customer, and former clients present value for your business marketing efforts. Keep in touch with former clients with advice relative to their purchase, maintaining cabinetry and countertops, warranty updates and incentives for referrals and reviews. All are valuable tools for your marketing and sales initiatives. Emails to homeowners regarding the latest design trends and newest products keeps homeowners’ fingers on the pulse, and entices them to engage designers for additional renovations in the home. The average return on investment for email marketing is $42 for every $1 spent.
- Develop a campaign to stay in touch with prior customers.
- Offer incentives for repeat customers.
- Develop relationships with homeowners.
Not only can a marketing review save money this year, it also helps align marketing’s goals with realistic benchmarks for the 2023 fiscal year and beyond. ▪
Denise Grothouse is the president and founder of Perfect Six Marketing, v.p. of the Executive Forum of the Lehigh Valley and director of Public Relations for the Heroplex Foundation.