The first step in determining how much to spend on anything is to clearly identifying your goal. Are you trying to introduce a new product, start a customer retention program or increase sales? And, how much are you willing to spend to accomplish your goal. Some businesses are willing to spend as much as 1/3 the lifetime value of a customer to acquire that customer, but even that depends on your product or service. Answering these questions will help determine an appropriate overall budget and influence where you’ll allocate those dollars.

To get closer to the right ratio, though, you need to understand your audience. And the more you know about them, the more likely you are to make smart decisions about what type of media to use to reach them. You of course need to start with the basics … your audience demographics. But if you can create a profile and really get to know your audience—what are their other interests and habits, who do they turn to for their information—you can more effectively target your communication.

So you know what your goal is and who you are talking to, but to reach your goal, what does your audience need to do? And, how quickly do they need to act? If you just want more people to know who you are, well, that will indicate a different type of media spend than if you want them to buy something today, right?

Finally, what type of new media are we talking about? The more ‘traditional’ new media, say banner ads or adwords, will have a very different placement to execution ratio than the ‘newer’ new media—specifically social media and the advertising opportunities available there. Generally, true social media has comparatively low placement costs, but if you’ve spent any time in this media, you know you can get completely lost in the execution of it. Making an intelligent decision of how to allocate your budget will require an accurate assessment of your (or your staff’s) skill set in this media—and in your industry specialty. I mean, if your time is more valuable doing what you’re supposed to, then you’ll likely want to pay a specialist to manage this. But if you love it, don’t require much sleep and can do it all, go for it.

Look, tomes have been written to this topic because there isn’t a one-size-fits-all answer that will work for everyone. But, if you ask yourself these questions, it’ll get you a long way toward the best answer for your business. Let us know how it goes.

We talk a lot here at hmc2 about being focused on results. And we are. Sometimes even more than our clients. Because we want to know how all our programs perform. But sometimes, return on investment (how much revenue you generated divided by how much you spent) just isn’t the right measure of how well your marketing works.

The thing is this, brand advertising, social networking, customer relations or CRM don’t always translate into an immediate return on investment. That doesn’t mean you can’t quantify their value, you just can’t do it with a simple ROI calculation described above. If you ignore marketing opportunities because they aren’t going to generate immediate income, even your best performing ROI generators will loose their impact over time because you always have to be thinking about your brand’s future. If you only invest in the things that make you money today, you’ll be sacrificing long term brand health.

So, when you’re trying to decide how to allocate your budget (marketing and capital) to get the best return, remember some portion of it should be an investment in your future. With your marketing, remember that brand awareness is what puts you top-of-mind so when your prospect is ready to make a decision, you’re well positioned. It’s what keeps the funnel full so as your prospects move closer to purchase, there’s someone else already getting ready to move down the sales path. With your capital, think about the types of services or products you can add to your brand portfolio that will support not only who you and your customers are today, but who you want to be in the future and who you want to serve.

If you have questions about how to balance your marketing portfolio, give us a call. We’ll walk you through it.

1. Decide what constitutes a conversion – this will typically be a visit to a thank you page.
2. Define a segment based on this rule.
3. Apply this segment in addition to your “all” segment to your GA profile and then look for visits to your landing page.
4. The result will be a report that shows you number of visits to your landing page -and the number of those visits that resulted in a conversion.

You do lose some of the functionality associated with traditional goal creation (goal value tracking and the non-session nature of a goal conversion) but overall you’ll have an excellent view of your campaign’s performance—and to boot—you’ll have a segment that can help you determine where your converters come from, what else they look at, and how they behave. Enjoy!