Effective Spending in a Down Economy

We are all well aware the economy has been less than stellar as of late.  Almost everyone has felt the downturn, especially in the business world.  Decisions become more difficult as cutting costs becomes a necessity.  Although it’s often hard to think otherwise, slashing your marketing budget in such an economic environment is one of the worst things you can do.  A business still needs to work to add to its bottom line.  However, sometimes the budget is trimmed for you, and your job suddenly becomes doing more with a lot less.  The alternative is spending that budget more effectively. 

Businesses are relying more and more on “digital” marketing, and the current economy has only hastened that fact.  Why?  Two reasons:  it’s effective and it’s measurable.  Recent studies have shown that while a vast majority of print budgets are being slashed, email marketing and search engine budgets are more likely to maintain or even increase.  These are undoubtedly two key areas in which you can be more effective with your marketing budget.

It’s natural to look for ways to cut spending in a down economy.  However, marketing is an investment, not an expense.

Email Marketing

Email marketing allows you virtually instantaneous, real-time access to your results and has a minimal production time as compared to direct mail campaigns.  Here are three other areas where email marketing outshines direct mail:

Total cost:  this is fairly obvious and includes both design, production (printing vs. an HTML template) and sending rates.  Email is always a mere fraction of the total cost of a print / direct mail campaign.

Response rate:  the standard response rate that direct mail campaigns look for is between 1-2%.  By contrast, email campaigns typically have a response rate (taking advantage of a call to action) of at between 5-15%, as well as an open rate of over 30%.

Cost per lead: we believe email marketing is almost always a more effective approach, and it’s typically not even close.  But even if this wasn’t the case, and both mediums had the exact effectiveness, email marketing would still provide a huge advantage in cost per lead due to it’s total cost advantage.  But as email marketing’s effectiveness goes up, it’s costs per lead shrink even more, providing a clear winner.

Search Engine Marketing

Search Engine Marketing (SEM) and Search Engine Optimization work in tandem to provide businesses with something they crave:  pre-qualified leads.  If your customers find you via search engines, you can be very confident that they have pre-qualified themselves as being interested in your product or service.  Compare this to a traditional advertising campaign via print, radio or television.  Old school campaigns such as these operate under the assumption that if you cast a wide enough net, you are bound to catch something.

If you absolutely must cut your marketing budget, cut less effective / less measurable items first like direct mail campaigns, print / tv / radio advertising.  And in the end, remember the old adage: Marketing should be looked at as an investment, not an expense.