Are Marketing ROIs Worth the Cost of Advertising my Business?
Companies spend a lot on marketing efforts. In 2021, US advertisers spent $296.4 billion dollars on media, and are expected to spend $33 billion more in 2022 according to Zenith. But is all that money well spent? And more importantly, does marketing actually work? An ROI (return-on-investment) analysis can help answer those questions.
What to consider when analyzing your marketing ROI:
Customer Lifetime Value –
- It often costs less to keep an existing customer than it does to acquire a new one.
- Advertising helps engage current customers with your products/services and encourages them to shop again with reminders and new offers.
Market Share –
- Market share is the percentage of your sales ÷ total industry sales in a given time period.
- Advertising allows more potential customers in the market right now to become aware that you exist, and also provides an easy avenue for them to make a purchase.
One of the downsides of marketing ROI is that it can take time to accumulate value. A dollar spent today may not provoke action from a customer for years, and this can be particularly challenging for business owners and salespeople that want results immediately. It’s good to note that certain advertising serves to retain current customers and build trust, while others aim to earn fresh leads more quickly.
If you’re unsure of where to start or how to continue with the best results for you, talk to an LTD team member today. We’ll gladly turn your goals into strategies as your best ROI agency!