the 80/20 rule: how to spend less and get more out of your marketing

If you’re a business owner, you know that it’s essential to spend your marketing dollars in the right way.

But all too often, businesses make mistakes that limit their ROI from marketing efforts:

• They may choose the right traffic channel, but they don’t have the skill-set to execute what is needed to be successful.

• Or, even if their skill-set and execution are phenomenal, they may choose the wrong traffic channel – and won’t see great returns as a result.

In this article, we’ll discuss the 80/20 Marketing Rule – how to get more with less. This will help you avoid some of the most common mistakes that business owners make.

While these principles won’t be perfectly applicable to every business in every situation, they provide a broad framework that will help you get the most out of your marketing efforts.

#1 focus less on brand marketing and more on direct-response marketing

There are 2 main ways to approach marketing: brand marketing and direct response.

Brand marketing is concerned with generating brand awareness and creating a positive image for the company. Its success is measured by how many people see or hear about the company, as well as how positively they view it.

Direct response marketing, on the other hand, is all about generating sales. It’s measured by how much money is brought in through marketing efforts, compared to how much was spent on those efforts.

In tough economic times, companies need to focus on direct response marketing in order to get the most bang for their buck. That’s because cash-strapped marketing departments are under pressure to demonstrate a high return on investment. And typically, the share of the advertising budget devoted to direct response campaigns (such as online ads and direct mail) grows, while the share devoted to more traditional forms of advertising (like TV and radio ads) shrinks.

#2 understand the core metrics that drive profit

To be successful with direct response marketing, you need to understand and track the metrics that drive your business. These are the key metrics you should focus on:

• Lifetime Value: this is the total amount a customer spends with your business over the course of their relationship with you.

• Average Order Value: this is the average dollar amount a customer spends each time they order from you.

• Cost Per Acquisition: this is what it costs to acquire a new customer.

It’s important to not get too caught up in vanity metrics – things like the number of likes your Instagram posts get or how many Twitter followers you have. Instead, focus on metrics that matter for your business – like Lifetime Value and Cost Per Acquisition.

#3 use only proven traffic channels

When looking to generate more business, it’s important to stick to tried and true marketing methods. The following channels have been shown to be the most effective:

1. google business profile

A well optimized and well managed Google Business Profile is one of the best ways to bring in new customers. The traffic you’ll generate from this source is consistent and reliable.

2. google search ads

After a Google Business Profile, Google search ads are the most reliable form of online marketing. If you know your core metrics, then you’ll know exactly how much you can spend to acquire new customers profitably.

3. facebook ads

While not as high quality as Google traffic, the potential for scale through Facebook advertising is massive. And the costs are lower than on some other platforms. The key to success on this platform is having a value-first funnel; since people on Facebook are primarily there for entertainment and distraction, going right for the sale isn’t as effective.

It’s also important to have a strong lead nurturing and follow-up strategy in place. Due its interruptive nature, it takes longer to warm up social media leads. Automating lead follow-up with a good CRM & marketing software can help with the lead quality issues that so many business owners complain about.

4. display ads

Google Ads also has a display network; this is where you can place banner ads on other websites. These ads are most effective for retargeting campaigns – that is, targeting people who have already interacted with your business but did not convert.

5. ongoing website seo

Unless your website is already ranking in the top 5 for targeted keywords, it may be best to wait before investing in website SEO. It’s resource-intensive, and could take months or even years before you see a real return on investment. (That said, Local SEO helps local businesses get in front of more people by making their Google Business Profile more visible in the Maps section of the search results. And as stated above, this is a highly recommended strategy if you want to see quicker results from any SEO investment.)

don’t rush into things

When it comes to committing to new marketing channels, don’t dive in too deep, too soon. Wait until you’ve tested and analyzed the channel to make sure it’s worth your investment.

As an example, Google Search Ads can be very effective for some businesses, but you probably don’t want to start out with a huge budget right off the bat. At least not blindly … consult with an experienced RRDC advertising expert to decide on a good starting point for businesses in your industry and market.

Don’t over-invest in any one marketing strategy until you’re sure it will be successful. If something isn’t working after a few attempts, move on and try something else. You can always go back and retry things later on as the landscape and marketing strategies continue to evolve.

In conclusion, no single marketing strategy will work for every business – you have to find the channels that are most effective for your industry and target market. The five channels we’ve listed here are a great starting point, but it’s important to experiment and try new things as well.

Keep in mind that it may take some time before you see a real return on investment from any of these strategies, so be patient!

And above all else, don’t rush into things. Take the time to test and analyze each channel before making a commitment.

Ready to take your business to the next level with an experienced digital marketing agency?

Rachel Rowell Design Co. has helped hundreds of business owners streamline their marketing efforts using the 80/20 principles discussed here.

Schedule a strategy call with our team to learn more.