Applying My Accounting Strategy To Your Somerset Area Business: Results-Based Marketing

Applying My Accounting Strategy To Your Somerset Area Business: Results-Based Marketing

September 18, 2012

Do you, like me, sometimes get a little bit tired of the empty platitudes from experts weighing in on how you should make a goal for this, or that, etc., etc., ad nauseum. You wouldn’t believe how many articles I see, in the course of my work as your trusted Somerset Area small business accountant, which spout all kinds of this stuff.

So…great. You’ve set some goals for your business. Now what?

As an accountant, so much of what I do is measuring performance against financial goals, for businesses and for our family clients. But often, these goals aren’t self-enforced by the client — or there isn’t a good way to accurately evaluate their measure of success, due to poor tracking.

Now, the chances are, that many of your goals are sales- or marketing-related (or should be!). So, as one who has had to learn much of this the hard way, I thought I’d put together a short primer on how you can use goals in these areas — and save you my pain!

Applying My Accounting Strategy To Your Somerset Area Business: Results-Based Marketing
Many Somerset Area businesses have a wide variety of measurement tools in place for a host of variables, from payroll efficiency to profit margins, to inventory controls. But there’s usually a huge “missed base”, and that’s advertising ROI.

You see, many business owners look at their advertising in terms of “response rates” or “raising awareness”. It’s hard to measure “awareness”.

And while you *can* measure response rates, it’s actually the wrong way to think about your advertising. A better way to look at small business advertising results is actual Return On Investment.

Now, this type of analysis necessitates a couple things:

1) A measurement mechanism.
 This can be a coupon/gift certificate with a tracking code. It can be a dedicated phone line or web address to quantify leads. It almost doesn’t matter HOW you do it…just that you do it.

2) Advertising which incentivizes for a specific response.
 This rules out certain forms of marketing for the purpose of “image-building” only, unless you’ve got a bunch of dumb money to spend (Do you? I’ve got some beachfront property to sell you, then). Rather, you should focus on “response-oriented” marketing which will help you know if the advertising you’re paying for works. (Tip: Image-building will still happen, but as a secondary result to conversions.)

And I want you to remember this: 
any media sales person, any ad agency person, any consultant, anyone in your own firm who is opposed to direct-response tools does not have your best interest at heart. The person who opposes having the results measured accurately already knows that the results are inadequate.

Unfortunately, the ad agency business can be very much a smoke screen and sleight-of-hand business. You’ll be presented with demographic statistics from a given media that are just great. Unfortunately the listeners or readers all lied when they responded to the survey in order to look good and feel good. They inflated their incomes, for example.

Print media loves to snow you with its pass-along figures. They’ll talk 100,000 readerships with 20,000 subscribers.   When you have to write out the payroll checks, pay the other bills, pay for all the advertising, pay the taxes and then see what might be left for you, you cannot deposit pass-along statistics or “image” in the bank account.  You can only deposit dollars, which come from real results.