How would you feel if someone stole 5% of your company turnover over the period of a year. If it were an employee they’d probably be fired immediately. If it was a customer that would not pay, you would bring a case against them. But what if it were your fault? What is the reason that 5% of your turnover was wasted rested squarely on your shoulders? What would you do? Like most business owners you would do nothing and probably repeat the same exercise the following year.
The reason is that you would have failed to TEST & MEASURE.
This relates primarily to marketing spend but it can be linked to all areas of your business.
This is simply a way of measuring the effectiveness of each and every marketing campaign that you run to see if it worked or not. It also means running your marketing campaigns to smaller audiences and running many different ones. Most people cannot be bothered so they lose their 5% advantage.
Testing and Measuring on marketing is much easier today when you use email, mobile text messaging, Google adwords or similar. The impact on these campaigns is instantly measurable but again people do not measure. They repeat ads that do not work. Mainly because they do not understand marketing, but also because they feel that they do not have time or that their time is better spent on other areas of the business.
Example: Client has 5000 mobile numbers. He breaks this up into 10 groups of 500. He sends a text to the first 500 and gets a 5% response – 25 orders. He changes the words of the text and send it to the next 500. The gets a 2% response – 10 orders. He changes the text a thrid time and texts another 500. This time he gets 10% response because he included a special offer and an expiry. He decided that this was a good response and then sent the 3rd text to the 4500 others that had not received that one. He got his 10% response – 500 orders.
Imagine if each order was worth €20 – his revenue would have been €10,000
If he had only gone with option 2 at 2% – his revenue would have been €2000
Thats an €8000 difference – for the sake of 10 minutes work.
Thats why testing and measuring is so important. To understand how to implement this in your business, get in touch with me immediately.