Everybody is interested in dipping their toes into digital marketing, however many people struggle with understanding the best place to start. Should I dive headfirst into running some Facebook ads or should I start running my very own Google AdWords campaign? Many people start here, get excited and then unfortunately lose steam as they don’t get the results that they want. At this point you start searching the internet trying to find the holy grail of information or a cheap provider that promises the world. Either way you go at this point is destined to result in failure.

Digital Marketing is something that everyone feels that they can do and lots of people these days call themselves a social media strategist or a digital marketing wizard without any formal qualifications or anything to back it up. So, where do you start then? This is our #1 quick start tip for fast results when implementing a digital marketing campaign. If you do this step first we guarantee that you will be confident about where your marketing is going to take your business and who is going to implement it. Let’s get started!

Our #1 tip and something we start with whenever we launch a client campaign is …. “Understand Your Return On Investment”

I know, I know you’ve heard it a thousand times before and this isn’t some kind of new information that will blow you away, however this explanation will help you understand how you can explode your sales and build sustainable digital marketing campaigns that really do deliver a ROI. It all comes down to understanding what your ROI is and how you can achieve it. As we discussed many people jump headfirst into a digital marketing campaign either themselves or with a provider without understanding what impact it will have on their bottom line. Follow these steps and you will be prepared to take your marketing to the next level from day 1.

Understand your business data

Unfortunately it’s all too often that many of us as business owners don’t really understand our margins and what a customer acquisition means for our business. Every business is different and it will vary depending on what service or product you provide. You may offer a service that charges your customer every month or you may have variable once off purchases. Every customer acquisition has inherent value to your business and to your bottom line. Before we get into complicated customer lifetime value calculations that marketers love to throw at people you simply just need to understand your margins as follows:

  1. What does an average sale look like for your business every time you acquire a customer?
  2. What kind of gross margin do you generate for your business every time you acquire a customer?
  3. How many times on average does your customer purchase from you in a 12 month period?
  4. How many referrals do they generate for you?

Many people see these questions and then start to think it’s all too hard. It’s a worthwhile exercise because you not only start to understand your business a bit more, but you can start to see how your marketing really should take into account what a customer means to your bottom line so you can determine if you’re making money or losing it each time you acquire a customer. The beauty of digital marketing is that you can track that all too easily.

There a couple of ways you can use this data:

  1. You can create a simple calculation > Per customer I make $1,000 multiplied by my gross margin of 40% means that for every customer I acquire I generate $400.
  2. You can go a bit further with a lifetime value of a customer calculation. Work it out using this information below.

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How To Calculate Customer Lifetime Value

Once you know what one customer means to your business you can logically start to follow the steps. If you understand what a customer means to your bottom line you can track what you’re spending and determine if it’s profitable. Why is this critical? You can not only see if a provider is delivering value in a service but you can build a digital marketing campaign that can scale.

Create a forecast

Just like your accountant would create a cash flow forecast we believe in a digital marketing forecast. Think about how much better off your marketing would be if you could understand and review what your actual results were in comparison to your forecast? It’s easy to start:

  1. Build a spreadsheet factoring in your marketing costs > pay per click costs, management fees from a provider, staff costs
  2. Use the information you’ve created based on your business data to track what every enquiry you generate will mean for your business
  3. You can forecast how many enquiries you expect to generate and if you do meet that target and for that spend what will that look like for your bottom line
  4. You can now understand if spending $1,000 on SEO is going to be profitable or even those $500 Facebook ads really are delivering

We know it’s not entirely that easy so we’ve decided to give you access to our expertise and skills to create you your very own digital marketing forecast. It’s valued at $1,000 but you can request it here for FREE. If you follow these steps you will easily be able to launch a successful digital marketing campaign that delivers real results to your bottom line.