Are you aware of what General Catalyst is doing? No? Click here to learn how they are funding your marketing efforts, then taking downstream orders/sales from the customers they help you acquire (HT to https://twitter.com/d_mccar).
Think about it this way. Here's our Marketing Budget Experiment, and in this case our brand is going to spend 25% more on Paid Social for one year. Here's the projected outcome of the Experiment.
In this example, you spend $1,773,219 of marketing expense (you spend money acquiring the customer, then in the first year you have marketing expenses associated with the newly acquired customer, resulting in a lot more total first-year marketing spend). You lose $785,458 in the first year. Yikes! You generate 14,614 customers ... meaning you lose $53.75 converting these customers. Once you lose that money, the customers begin paying you back.
- $15.48 in year two.
- $16.47 in year three.
- $14.83 in year four.
- $13.80 in year five.
- (presumably more in years six, seven, eight, etc.)
- You generate $60.59 profit in years two, three, four, and five.