Do you ever worry that you're wasting your marketing budget? It's a common concern for business owners and marketers alike. We all want to see results, and we don't want that sick feeling that occurs when precious marketing dollars aren't getting the expected return.
As you're planning forward in 2015, think data. As one of my favorite marketing scientists likes to say, "Marketing without data is like driving with your eyes closed." If you aren't making marketing decisions using data, you likely are wasting your marketing budget.
Here are 3 signs you aren't getting the most for your money:
1) You're Not Setting SMART Goals
Ugh, goals, I know. It's often hard to figure out how to set a reasonable challenge that help your company, while not setting yourself up for failure with your CEO. SMART goals will help you create challenging yet realistic goals that you can measure. SMART goals are Specific, Measurable, Attainable, Relevant, and Time-bound.
- Specific - Exactly what will you be measuring to determine success? For instance, more website visits, more leads, and more customers don't include that important numeric component - how many more leads do you need this year for your sales team to reach their goals?
- Measurable - When setting goals, you need to identify a meaningful metric and the methods you'll use to measure it. A goal related to "increasing engagement on social media" should include specifically how much you want to increase it (50%?), by when, and what type of engagement you'll track. Also, ask yourself if the goal will actually accomplish what you need. If you increase your Twitter followers to 18K, but don't have anyone retweeting or favoriting posts, did you really achieve anything for your brand? Is anyone coming from social media to your website and converting to a lead? Most social media platforms have built-in analytics, and there are great tools available to track overall social engagement across platforms as well as the impact to your business (my personal favorite tool for this is HubSpot).
- Attainable - Goals need to be challenging but not impossible. If your CEO needs an increase in qualified leads to reach revenue goals and you plan to go for a 50% increase, check historical data. What were last year's trends on this metric? What challenges could you be facing this year?
- Relevant - Does your goal relate to or support your overall mission? A goal of "increasing Facebook posts to 20 per week in Q1" is not relevant if your ideal buyer isn't on Facebook.
- Time-bound - Did you set a "by when" date for your goal? Give your goal a specific timeframe to reach goal. For instance, "Reach 10,000 website visits per month within 6 months." Create checkpoints along the way so you can adjust activities if you appear to be getting behind in your progress.
2) You're Not Inspecting What You Expect
As you are carefully planning your budget allocation, you should also plan how you will measure success. Just as many of us don't like opening the credit card statement after Christmas, it's tempting to avoid what could be bad news in reviewing your marketing efforts. But isn't it worse not to know exactly what worked and what didn't? Which dollars led to closed business for your sales team? Which campaigns promised success but held little return?
If you don't measure historical performance and track the impact of marketing events, you will miss correlations with increased leads and sales. When you're watching trends in the data, you can decide early whether your marketing dollars need to be shifted elsewhere. If you trying a new channel or strategy that seems to be yielding great returns, dig down to be sure there aren't other contributing factors impacting your impression. This will allow you to make informed decisions in your next budget.
As you're measuring results and calculating ROI, don't forget to include the cost of the time you and your team are spending. Some marketing solutions may initially appear to cost more, but may have a better long-term value because they achieve the same or better results more quickly. It is also helpful to consider what the cost would be if you had to hire new employees to execute in-house.
- Plan and document how you will measure results and how you will measure each channel's contribution
- Plan and document how long you will wait before changing course if results aren't on track
- Regularly inspect progress against your goals using reliable analytics
- Determine each channel's contribution to your goals, taking into account how much of your budget that channel consumed
3) You Don't Have Closed-Loop Marketing Tools
Does your company have a way to easily measure exactly how your marketing efforts resulted in revenue? In many ways, marketing is more complicated in a digital world than it was in the "old days", but luckily, it's also more measurable.
Today, we can track all sorts of things related to marketing. From measuring website visits with Google Analytics to advertising-driven calls with call tracking numbers, you can use data to determine which campaigns drove the most interest.
Marketing that drives calls or website visits is only one part of the picture. Do you know which of those visitors turned into qualified prospects? Can you tell which finally turned into customers? Closed-loop marketing tools allow you to track all the way through.
There are many free and paid tools you can use to measure the top of the funnel, but few that effectively track a prospect all the way through. The best tool I've found for measuring the whole process is HubSpot.
For instance, with HubSpot I know exactly how our blog is performing and which posts drive the most leads and customers, or which social media platform has the best value based on conversion rates of visitors into customers.
The 3 examples above are just a few of many possible signs that you're not getting the best ROI on your marketing budget. I'd love to hear what you've discovered is a waste of dollars in the comments below!