We’re asked constantly about what marketing strategies are best for local businesses. And we feel pretty strongly about the answers we give. But today, we’ve got our hands on the latest research that answers this question (and more) based upon a survey of nearly 4,000 businesses around the world.
Here are some of the highlights from the respondents, half of which had annual revenues of less than $1,000,000 and the other half more:
- About 75% of marketers around the world prioritize inbound marketing tactics over outbound tactics. In a nutshell, we describe inbound marketing as marketing with magnets and not sledgehammers. How do we attract high quality traffic to a website, convert those visitors into qualified leads by offering them a compelling reason to give us their email address or other information, and then nurture those leads so they become customers. Whereas outbound marketing relies on interruption techniques like advertisements, commercials, direct mail and other methods which we are very much ignored these days.
- Regardless of if the marketer focused on inbound or outbound strategies, the #1 most overrated tactic was identified as paid advertising. It’s important to keep in mind here that they were asked what tactic was overrated, not necessarily ineffective. Paid advertising can be an important part of an overall marketing strategy if done right. But it’s usually not.
- A primary key in long term marketing success is tracking ROI (return on your marketing investment) and making sure you are spending your budget wisely. Unfortunately, this is an area most businesses lack in implementation. We use very sophisticated (yet easy to understand) software and analytical tools to provide exactly this information to our clients. It helps everyone involved make better marketing decisions and usually results in being able to spend even more on marketing since we have a great understanding of what works and what doesn’t.
- Experienced marketers understand that while short-term results are possible, this is a long-term strategy where patience is vital. Results only get better over time where previous decisions can be analyzed and improved upon.
- Inbound marketing achieves a higher ROI than outbound. This held true across companies of all sizes and budgets. The long term impact of inbound marketing, where you are making an investment in your business by creating marketing assets often with a sustainable life span, provides a clear superiority over outbound, interruption types of techniques that end as soon as you stop paying.
What’s the most important priority for small and medium size businesses?
Getting more leads and converting those leads into customers, of course. It’s what every business wants and needs. In fact, 71% of small businesses identified those as their two most important priorities in marketing. These far exceeded increasing the revenue from existing customers, which around 45% of small businesses stated was a priority. And something that was really interesting, only 20% said that reducing the cost of acquiring customers was something they considered important.
So basically, small businesses are incredibly concerned about getting more leads, and turning more of those leads into customers, and they don’t really care how much it costs to do so. That’s fine, but of course they should care about customer acquisition costs. As we said earlier, tracking and showing a great ROI is a key to long term marketing success. And to calculate ROI you need to know how much you are earning from new customers as well as how much you are spending to acquire them.
We think one reason why small businesses don’t place as much emphasis on the cost of customer acquisition as they should is because they simply aren’t tracking that number to begin with. They don’t have the proper tools in place to make these types of informed decisions. Fortunately, there are tools available today that even smaller companies can utilize to make intelligent choices in marketing.
Lastly, companies with smaller marketing budgets overwhelmingly believe that inbound marketing is far superior to outbound marketing when trying to acquire and convert leads without unlimited funds. And we definitely agree with this. While you can get a quick customer or two from outbound techniques, inbound marketing is truly building an asset for the company that has the potential of attracting visitors, converting leads, and closing new customers for years to come.
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