Recent studies have again shown that inbound marketing is a cheaper lead generation tool than outbound marketing.
While inbound marketing (which includes: blogging, social media, search engine optimization [SEO], and search engine pay-per-click advertising [SEM]), may reach smaller audiences than outbound marketing (direct mail, telemarketing, trade show, and trade and consumer advertising), the cost per lead and cost per sale are typically significantly lower for inbound. While it may be impossible to generate all of your sales leads requirements through these inbound efforts you should certainly maximize and allocate your dollars and efforts to attain the lowest cost per lead and/or cost per sale.
I am often asked by clients and prospective clients, “How much should I spend on Search Engine Marketing aka pay-per-click?” The answer is as much as your budget per lead allows until you can convert the leads to sales and validate the lead source via a cost per sale. Typically, I am accused of double talk after the response. The simple fact is that most companies know how much it costs to produce a product or provide a service, but many do not know what their customer or sales acquisition costs are.
Without knowing your costs of acquisition you have to focus on your cost per lead until you can track leads to sales. You’ll need to know your typical “time to close,” “closing ratio,” “percentage of closure rate per sales process step,” and more. All should be tied back to your lead acquisition source to make an educated judgment on how to spend your resources by source.
As the internet has evolved and the economy has gotten worse, prospective buyers research more than ever before making their list of products and vendors of consideration for purchase. The most prevalent research medium is the internet and articles, white papers and media coverage are all reference points for prospect research. A solid internet strategy is more than SEM and SEO, it’s also getting the references, back links, chatter on blogs, reviews, etc. Public and Media relations are critical to a successful internet presence. While many trade publications are “controlled circulation and access”, which is not indexed, or at least the articles are not readily available via an internet search, many trade, consumer, and news sites, blogs and archives are widely indexed.
Like any investor with your lead generation and marketing you need to “spread the risk, invest in the highest probability returns to the lowest, and monitor them constantly.”
If your PR firm is focused on paper – you better augment them with online efforts or replace them with a firm that can integrate the online and offline editorial opportunities.
Share your thoughts or questions by leaving me a comment.
Michael Romanies has more than twenty-three years’ experience in P&L management, marketing, sales, business development, product management, and operations. Michael has held executive positions in technology and publishing companies and has extensive experience in business-to-business (B to B), business-to-consumer (B to C), and business-to-government (B to G) product development, marketing, and sales.