That’s right; I don’t believe in and am not a fan of setting traditional marketing budgets for simply budget sake. Benchmarks, yes, especially as expressed in percentages but what if you set out a 7% marketing
budget and the campaigns you implemented work famously. Do you sit tight? We like to see our clients think in terms of ROI at all times but also what the lifetime value of a client/guest/patient means long term as well as from a referral perspective.
So here are some questions to seriously consider:
If we were able to devise programs that when deployed would increase your business and profits of $1,000,000 each time, what would you willing to invest to make that happen? Would you allocate 10%? Keep in mind that would leave you with
$900,000 in gross profits. How about investing $200,000 which would still leave you with $800,000? $300,000 to make $700,000? Even if we invested 50% you would still derive $500,000 in profits up front.
So perhaps the real conversation needs to be switched from, “What’s the least amount we can spend to acquire a customer?” to the far more important question, “What’s the most that we can/will spend to acquire a new customer?”
When you truly understand the true LIFETIME VALUE of your client/guest/patient any Caribbean business owner or anyone braking into the Caribbean marketplace would find the money to get them on board. It’s the vast differed between getting a customer to get a sale to making a sale to get a customer.
When we sincerely grasp this concept, it’s a real game changer.
– – – Rich Sadler, Caribbean Marketing Director