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Growth without Cash
One key advantage of web marketing over traditional methods is
the ability to measure accurately the results. This has always been claimed as
the justification for direct marketing - but web marketing takes the advantage
one stage further.
Traditional direct marketing relies on 'pushing' the product
to an audience the marketer has selected as relevant. Web marketing 'pulls' the
potential customer to a product that the customer has himself selected as
relevant. Then web statistics can measure how he found your site and the search
process followed.
Traditional direct marketing relies on the print industry to
produce mailers and has relatively large up front costs of design and print. Web
marketing has no significant set up costs.
HOWEVER, once you decide to maximise your web marketing
because of its advantages, you find cash is an issue. The quickest way to
increase your web traffic is to pay for cost per click advertising. That money
is committed before the order comes in. How can you be sure it will give the
right results?
The big company answer is to test. Conduct a statistically
valid test of the alternatives and prove an answer within 95% confidence limits.
The small company does not have that option because the
measurement of small changes, such as an improvement in response rates from 1-2%
requires a sample size above their likely number of customers.
The solution is to manage growth by cash flow.
- Allocate a growth budget for maximum risk - say £500
- Spend the budget on carefully targeted keywords or
adverts, but spread over 2-3 months
- Increase the budget by the net value of sales
actually made
- If results are disappointing in month 1, continue
nonetheless in month 2 to check if it is just a random result.
- Worst possible result - total loss of your starter
budget. Best possible result - a steady growth in profitable sales
So think about your options when you are next phoned by a
sales rep for print media - or even an online directory.
Then if you want my help to manage your profitable web
marketing, click here.
Regards
Stephen Orr
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