Home Articles Where to spend your online marketing budget to attract sales

Where to spend your online marketing budget to attract sales

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As an online marketer who started his sales career when telex machines were in active use, introductions were polite letters written on Triumph-Adler typewriters, and a fax was the hottest gadget around and was spelt ‘facsimile’, I sometimes feel, well, old!

On the other hand, it also means I have seen trends come and go, I have witnessed first-hand much of the timeline of the information revolution, and I can put things into perspective.

I love change, I thrive on it, which is one of the reasons I have never had a job more than four or five years, and never will. But I also know that the more things change, the more they stay the same. Very early in my career I had an “IBM-educated” sales manager who taught me some of the basics of selling.

Firstly, he taught me what I have seen in various guises in numerous sales seminars since – the sales funnel – more on that later.

Secondly, he was the first to tell me the real truism of all sales activity: “People buy from people” – a statement that embodies not just the mere fact that the process of selling is personal and emotional, but that successful sales is someone buying, as opposed to being sold to.

This applies regardless of whether you sell homemade lemonade outside your parents place on a Sunday, or if you are selling a multi-million dollar computer system. It also applies equally to what channel you use to promote your product.

Back to the sales funnel. The four key stages of a sale from the seller’s perspective:

  1. Qualification – figuring out what the prospect want
  2. Presentation – presenting your product or service
  3. Handling objections – removing any obstacles to a sale
  4. Closing – getting the order

At other times it is used to refer to the various stages that a buyer is in, from becoming aware of a need (or a want), through researching alternatives, obtaining quotes and finally placing the order.

Simple as this may sound, being aware of this when planning an online marketing campaign can help you not only plan your campaign, but better understand where to allocate the marketing budget, and in what portions.

Awareness Phase – making sure the tyre-kickers find you, while not wasting your time or money

This may take many forms, and is typically the sales phase where the sellers can least influence the buyer. It is where your potential buyer is starting to think about making a purchase of whatever it is you are selling, but haven’t decided what, when and where to buy. External influences play a part, but this is where your marketing should be broad based. It’s too early for a special offer – awareness of your existence is the best you can hope for (having a good brand helps, of course).

If you can afford to, spend money to be seen by the largest possible share of your target audience, but don’t spend big – a maximum of 15-20 percent of your budget is a good guide. PR and similar means of getting the message out can be effective, but remember, the effectiveness of your message is hard to measure in this phase (another reason to spend wisely and miserly – bang for your buck is measured in potential eyeballs reached, not much else.)

The online marketing channels to use in this phase are typically broad-based, offering lots of eyeballs. Your selection criteria should be about the sites that you know your target audience visit, and minimum cost per thousand (CPM). Search (organic or paid) plays only a small role at this stage, but pay attention to your landing pages for any campaigns – relevance is the key (but then again, it always is).

Research Phase – taking care of your visitors

This is where you want to start making sure your product or service is being seen by the customer. It is, in many ways, the most critical phase for an online retailer – you want your customers to not just find your site but also find the information they are looking for and, most importantly, buy from you when the time comes.

If you attract enough visitors to your site through your well-known brand, PR activities or CPM-based campaigns, your marketing success in this phase is all about making sure that your site is useful for the prospective buyer – that he/she can easily find information sought, that it is well presented, that you seem to be credible, and that your visitor wants to come back to buy!

Given that the customer is in the research phase, it is important to recognise that most visitors will likely leave you without buying, and the nature of the web shopping experience is such that your visitor won’t be loyal to you – he/she will leave you. So make it easy, but make sure you understand where they go afterwards, and that they come back.

Use the fact that your visitors are transient to your advantage, anticipate where they may want to go for more research, and help them get there.

I am not advocating that you should put links to your competitor sites, but to industry resources, product comparison sites, etc. Don’t even be afraid of other sites where your competitors may advertise – your visitors will go there anyway if it is relevant. Being helpful never hurts!

The marketing “spend” in this phase is all about the investment in your own site, and about web analytics – understanding your visitors’ behaviour is critical.

Search plays a big role here, but the more you can get from your organic (free) search in this phase, the better, as you don’t want to spend your entire paid search on the tyre-kickers, just plug the holes that your Search Engine Optimisation efforts may have left. Ideally, you shouldn’t spend more than 20 percent in this phase, and measure it the same way as for the next, important phase.

Quotation Phase – where the rubber hits the road

Now things are starting to get really interesting. Your prospective buyer knows what they are looking for, they are getting ready to buy, they want to know what things cost and it is important that they find you.

This is where an online retailer should spend most of their advertising budget – 60-80 percent or more. Depending on what product or service you are selling, the mix of activities can be great:

  • If doing banner adds, make sure you know the target audience of your chosen sites and make the offer specific.
  • Shopping comparison sites can be very effective here.
  • AdWords is an absolute must – the more specific your ads, the better.

The most important thing to remember here is being specific. Don’t waste money on generic keywords in AdWords or branding messages – your prospect is ready to buy and they know what they want. Get them (back) to your store!

The beauty of this phase is that whatever you do can be measured – use a strict ROI goal and make sure you know what the cost per acquisition (CPA) is for each channel. If you get it right and you can find the traffic, your marketing budget is effectively unlimited. (It amazes me how few online marketers understand this. I often get a blank stare when asked what my online budget is and my answer is that if the CPA is less than my net margin, my budget is unlimited!)

Closing the Sale – the moment of truth

Just like the research phase, this is again all about your website – your advertising job has been done, now make sure you don’t waste it! Make sure your visitors can easily find the products they want, how much it costs, when it will be delivered, how it will be delivered, how much it costs, how they’ll pay.

It doesn’t matter how much and how well you spend your marketing dollars, if your site fails to deliver, it’s all wasted.

Kim Wingerei sells mobile phones and telco services online. He works to live, is easily distracted and likes sailing.

Photo: modernadude

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