One of the biggest frustrations for local business owners doing online advertising, is determining their return on investment on ad spend. Throwing money into ads on Google or Facebook is supposed to be the future, but as easy it is to get on them, it is just as easy to see money being charged to your account in minutes. While it is no doubt that old style ad platforms are either dead or dying, they at least gave a sense of getting something for one’s money.
Even worse, there are some so called experts, who insist for a business to be successful in this era, they must be social media stars of sorts. To me, this is a problem in two aspects:
One – Most business owners did not go into business to be celebrities.
By moving focus to doing things like Snapchat stories, Youtube videos, or Tweeting funny pics, business owners are not performing their best service. I do not believe it is wise to try to be something mediocre in a land they are not passionate about. Also, it is not what most entrepreneurs are passionate about doing, which will make them resent even participating. This will lead to less joy and growing an expertise in their primary business functions.
Two – There is no real correlation of being on social media to show increased profits.
It can be assumed, but there is no empirical proof that being popular on a social media platform leads to higher profits. It is often assumed that the model of the Kardashians on INstagram, will translate to any business. I do not believe that to be true.
Why? People are not following brands on social media. The most successful followings are for individuals, NOT the local dental office. Now, if a dentist is very comfortable on camera and can leverage that to some unique videos, that is indeed possible. But, it is not likely, nor is it required to have success advertising online.
But where others are seeing dismal results, there are others who know how to make social media advertising really pay off. All we really need to know to ensure social media ads are effective are a couple of basic systems in place.
First – Know what a new client is worth
There is no need throwing money at a campaign if we do not know what each client represents to our bottom line revenue. To know this all you have to do is take your list of clients and divide by your yearly gross revenue. I am often surprised at how many business owners do not have this basic info down. There should never be any ad campaign paid for without this information in hand.
Second – Require a redemption vehicle for an offer
Earlier, I spoke about how some experts say that simply being visible online makes you more profitable. I am not interested in being visible when I am doing advertising. I am interested in making money. By knowing how much money came in from an exact campaign, we can the repeat, improve, or kill off a bad method or channel. Without a way to measure how many people redeem an offer we will never know how much to put into a channel. This is true for offline as well as online.
Third – Immediate Continuation or Upgrade Offer
Now there may be some who see a flaw in my logic. After all, the redemption tracking is obviously for a special offer that is a discount to get new clients. Would not these people be worth LESS than typical clientele? That could be, but we are not going to let that happen. We are not interested in one time customers. We want to establish long term clients in all of our advertising.
So, there needs to be an established upgrade or continuation offer made upon redemption. So, if you are a reflexologist who just had a half off offer, you need to present the person who came in with a special deal for a package of 6 more sessions. Remember, they came in because they see themselves as being wise to get a good deal. It is much more likely they are going to take another deal from you right away.
So, if a 6 package of reflexology appointments normally sells for $240, you can offer it at $200. This is increasing the value of each redemption to your office. And we all know once a person starts a habit of receiving our services, they are more likely to continue.
Also, you can do a 90 day tracking of the return you get from your ad campaign. This time, you divide revenue from the new clients by the amount of clients. Then to get a yearly projection, just multiply by 4. If the number you get is equal to or greater than the cost of running your ads, then you are either getting new clients for free or better, getting them at a profit!
This is how ad campaigns should be judged from online, not how many likes and shares you get, but money. We at Sterling Ventures Marketing, call this Return On Attention. If you follow the same process, you will not get caught up in a bunch of hype. Let your competitors try to make funny viral videos, you just keep making profits.