March 29, 2009

If You Had $1,000 Of Your Own Marketing Funds To Invest

You might be interested in seeing the results of last month's poll --- "If you had $1,000 of your own money to invest in marketing, which channel would you invest in?" Only 26 responses, but the results are worth considering (the responder could pick up to three choices ... visit the site to take the poll, still one day left):
  1. 73% = E-Mail Marketing.
  2. 57% = Paid Search.
  3. 23% = Affiliate Marketing.
  4. 23% = Shopping Comparison Sites.
  5. 15% = Blogs.
  6. 15% = Catalog Marketing.
  7. 15% = Direct Mail.
  8. 11% = Twitter.
  9. 7% = Facebook.
  10. 7% = SMS / Text Messaging.
  11. 3% = Mobile Marketing.
  12. 3% = TV / Newspaper / Radio.
  13. 0% = MySpace
  14. 0% = Portal Advertising.
  15. 0% = Banner Advertising.
Obviously, this poll isn't scientific, it only represents what 1.5% of this audience thinks. And yet, the shiny new toys (Twitter, Facebook, Blogs, Mobile) are not channels you'd spend money in. Nor are traditional tools (catalogs, direct mail, TV, radio, newspaper).

Nope, you'd invest in e-mail and paid search.

And yet, CEOs are always telling me about two fundamental truths.
  1. E-Mail marketing has unlimited potential, but never achieves it, yielding $0.15 per e-mail when done with little effort ... yielding $0.25 per e-mail when executed in a targeted, personalized manner.
  2. Paid Search doesn't scale ... you "max" out your opportunity --- online CEOs are all looking to "detether" from Google.
So what is it? Are these the places to invest money because of their own inherent potential, or are the alternatives poor performers?

5 comments:

  1. I think the dollar amount is the issue. CEOs spend more than $1000 on marketing so the comparison doesn't work.

    At $1000, you aren't going to max out email or paid search. So you'd want to choose those because they typically have the highest ROI.

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  2. Ben, the question was you, personally, what would you spend your own money on.

    So, what would you personally invest in, if it were your own money?

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  3. I think what Ben is saying is being limited to $1,000 Email and Paid Search are going to provide the highest ROI, and I agree. Traditional methods of catalogs and other direct mail have fixed costs that are much too high to get a decent reach with only $1,000 and things like Twitter and Facebook are excellent supliments to other marketing efforts.

    Let's look at our actions instead of our words if we want to know what people would do with $1,000. Kevin, I think what you are doing with this blog shows exactly what you would spend your time and money on...a blog. Personally most of us would probably fall into the email and social media lines with how we personally promote ourselves since mailing out family newsletters and printing pictures rarely happens anymore. This is because new technology allows us to get the same result (or possibly a better one) cheaper, faster, and easier.

    I guess it all depends on what your goal is for your $1,000.

    How about, how would you aquire new customers with $1,000?

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  4. Personally I would do SEO first (and I do).

    But my overall point is that no channel scales indefinitely. CEOs shouldn't worry that email and paid search are maxed out. They should be asking what additional channels can be layered on to increase the campaign's scale profitably.

    If their internal team/agency can't answer that, they should look for a new team/agency. :)

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  5. Good job, Ben, thank you!

    Derek, I invest my money in writing books. More than half of my clients tell me they purchased one of my books before having me do a consulting project. The best ROI, from a holistic sense, comes from writing the books.

    I could invest in e-mail marketing, but that is pointless, because there I am pushing a message whereas I can achieve the same objective with the blog and encourage folks to pull the message.

    Paid search doesn't work for somebody like me, why spend money on the keywords "database marketing" when I can build an audience with a blog.

    Why invest money in a blog when I can do it for free?

    Twitter has been close to useless, now that I'm 400 tweets into my experience. I can trace projects to my blog and my book, I can't trace anything more than followers to my Twitter presence.

    I had a Facebook presence for a year, zilch in terms of ROI.

    I've spent money on traditional direct mail, that was a pointless exercise.

    Any other tools would not serve my needs.

    So my answer would be "other", because my books have been the most effective marketing tool I have, followed by the blog. The books add a level of credibility that the blog cannot possibly match.

    Now, if I were a $50,000,000 business, everything changes. A blog cannot possibly scale for a decent sized business in the way it can for a sole proprietor --- but social media, taken as a marketing practice, could potentially scale. So the answer gets a lot more interesting for a decent-sized business.

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