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Don't Spend More on an Online Marketing Service, Just Spend Smarter: The Snowball Effect Part 2

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So what do you do when you can’t spend money on an online marketing service, but you not spending money means that you lose even more money by losing new customers?  The answer is quite simple really.  You don’t need to spend more.  You just need to spend smarter.  If you’re spending a couple of grand on some sort of internet marketing, lets say search engine marketing, but that online marketing isn’t bringing in any more business than usual, then you need to stop paying for it.

Suppose you’re the corner coffee shop.  All the people living around you that need coffee will come to you for coffee whether or not you advertise to them.  So why would you spend ridiculous amounts of money on an internet marketing strategy that targets those people that are already coming to your store?  That type of online marketing is not worth the investment.  If an internet marketing strategy is not bringing in any NEW customers, then it is worthless.  Any online agency should know that the purpose of an online marketing strategy is to gain new customers, not keep existing customers (that’s what customer service is for).

You need to figure out what amount of customers you would have regardless of your internet marketing.  Let’s say that with the online marketing service, you have 105 customers.  But 100 of those customers would come to you anyway, with or without having been exposed to your internt marketing efforts.  So that internet marketing is only bringing in 5 new customers.  Now let’s say that the online marketing service cost you $5000.  But those 5 customers only gave you $1000 (yes, I know, that is some pretty expensive coffee, but go along with me here).  Since the internet marketing campaign had no effect (either positive or negative) on the 100 customers you already have, the money they gave you is irrelevant.  The $5000 you spent on that internet marketing campaign only brought in $1000.  Congratulations, you have just now lost $4000.  That type of investment may not be a good idea in this economy.

A good online marketing strategy doesn’t focus on targeting customers you would already have.  In fact, a good internet marketing strategy doesn’t waste any time with those customers at all.  A good online marketing strategy only focuses on targeting the customers that you don’t already have.  These are the customers that will bring in more money.  These are the customers that will make your investment in an online marketing service worthwhile.  If your business is snowballing out of control, you can’t just stop spending money on online marketing all together.  You just need to spend on an online marketing service that will bring in NEW money.  Don’t spend more, spend SMARTER!

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