Five Mistakes That are Killing Your Marketing ROI

by Eddie Reeves on

In this tough economy, it is crucial that every dollar your business allocates to sales and marketing be well spent. But which marketing methods really give you the most return on investment (ROI)? SEO? Direct mail? Social media?

The truth is that there are other, more basic questions you should be asking before worrying about specific marketing tools. If you are making the five most common marketing mistakes, you’re going to lose money no matter what.

Here the five:

Mistake #1: Using a Shotgun instead of a Rifle

If your company spends $30,000 to get its new advertisement in front of 1 million readers of a magazine (only three cents per thousand people), is it a good investment? Not if only 100 of the magazine’s readers are in your target market.

Do your homework in advance of booking your campaigns, and calculate the real cost of reaching your target audience. If you don’t know how many legitimate potential customers are in the group you are marketing to, don’t book the campaign.

Mistake #2: Spending Money on Marketing You Can’t Measure

The next step is to eliminate any campaigns that don’t have real performance metrics. How much money is your company making from its trade shows, print ads or pay-per-click placements? If your marketing department doesn’t have a way to answer the question, don’t write the check.

Mistake #3: Maintaining Ineffective Marketing Methods

Investing in marketing is different than investing in the stock market. It often makes sense to make regular investments in a stock over long periods of time, regardless of how it performs in the shorter term.

Not true for marketers. Don’t make the mistake of continually reinvesting in certain marketing modes because of some imagined need for marketing “variety.”  If some campaign vehicles work better than others, increase your focus in those areas.  And if a campaign tactic isn’t getting favorable results, ditch it.

Mistake #4: Not Negotiating With Vendors

Your marketing budget will come under pressure during economic slumps. When that occurs, don’t hesitate to seek concessions from your marketing vendors.
I once called the sales rep for a trade show and explained that the marketing budget had been cut by 20 percent.  Predictably, the rep grumbled, but ultimately agreed to cut our booth rental by 20 percent and threw in an extra couple of dinner vouchers to boot.

Mistake #5: Cutting Marketing to “Save”

If you think about it, you’ve probably completely lost track of a few competitors recently. In an effort to hang on, more than likely these companies have stopped spending money on marketing. But unless your company sells sand in the Sahara, there are still customers out there, and to stop marketing to them is simply not smart. The momentum you lose will be tremendously difficult (if not impossible) and extremely expensive to regain later.

Avoid the five mistakes and you will not only save money, but might actually gain significant ground over your competitors.

Now that’s real ROI.

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