3 Ways Profit Maximization Can Turbo-Charge Your Sales Growth
Marketing Spend Slasher #2 – Reduce Client Acquisition Cost
In coaching hundreds of companies, only a handful knew clearly what their cost per customer acquisition was…that is, the total marketing spend divided by the number of customers.
Why is this so important? Because, it enables you to significantly reduce your marketing spend, by first reallocating it towards lower cost alternatives.
- Should you increase or decrease your Pay Per Click budget or pay to get higher in the rankings?…or drop back into a lower position?
- Is SEO really paying off?
- How about your tradeshow spend or
- Display advertising?
- Or what about the sales rep you hired?
All of these will result in different costs to get a customer.
REAL WORLD EXAMPLE:
Dr. D (name protected to avoid embarrassment for making the same mistake 98% of businesses make) had 7-8 different channels for getting new patients. Two of them accounted for 80% of these patients. Dr. D did not know what the cost per patient acquisition was for any of his lead generation channels, including the top two. We assisted him in calculating this cost and here are the results: Lead Generation Method #1 – Involved a specially designed display ad that they ran in the local paper once a month… it seemed quite expensive to him. Lead Generation Method #2 – He had used this “successfully” for years. However, he had noticed a drop off in activity as of late. It was a tried and true medium and he spent nearly 50% of their marketing budget there.
The Painful Realization
Well, the results were in after evaluating the previous three months of advertising spend and new patients that were generated from each. The result. Lead Generation Method #1 was costing about $128 a patient…not bad. Lead Generation Method #2 was costing……. A whopping $1,100 a patient or 700% more!
Here’s the really cool part
The following month they simply stopped using lead generation method #2, pocketed some of the savings, and reallocated the rest into running the newspaper display ad twice, and sprinkling the same ad in a few outlying community papers. The cost per patient acquisition went down below $100 the following month! Stay Tuned for Profit Maximization Marketing Spend Slasher #3.
Profit Optimization – The Boring Way To Riches
ACTION YOU CAN TAKE NOW
1) Determine your cost per customer acquired, by different marketing methods
2) Optimize your current customer profits and prospect conversion rates
3) Reinvest your “added profits” into your new customer generation efforts and play with the house money and prosper
To your success,
Scott
ScottHallman.com
