Attaching a Dollar Value to Marketing Efficiencies

  |  October 24, 2008   |  Comments

Why tying efficiencies to dollars becomes important during an economic downturn.

In the column, "Online Marketers Can Weather the Financial Crisis," I offered action items for dealing with the economic downturn.

My goal is never to be a doomsayer, but rather to be prepared for the reality of the market -- good or bad. And that includes recommending common sense actions to shore you up and provide a bullet proof vest for more difficult times.

Reality is, when down times arrive, most companies first look to the marketing department to trim costs. This is not because marketing has the least value; it's typically because marketers usually do a poor job of tying marketing to direct revenue. This is easily fixed.

Conversion rate optimization should be the last thing you should consider trimming. Here is why.

Shot Across the Bow

We are already beginning to see signs of the economy slowing, "The New York Times" reports on brick-and-mortar sales:

    Sales at Dillard's dropped 12 percent, compared with a 7 percent decline last year. J. C. Penney's same-store sales fell 12.4 percent, compared with a decline of 3.7 percent for the period a year ago. Sales at Kohl's decreased 5.5 percent, compared with a 3.2 percent decrease last year. At Bon-Ton Stores, same-store sales decreased 4.6 percent, and they declined 3 percent at Target.

And, here is Heather Daugherty, research director at Hitwise, discussing the Web economy:

    At Hitwise, we have been tracking these various economic indicators very closely and are now seeing a similar trend in visitation to the websites of retailers, particularly during the past few weeks where the economy has become top-of-mind for the majority of Americans. Last week, traffic to a custom category of 500 retailers (excludes auctions, classifieds, DVD rentals, and book/music/DVD of the month clubs) declined 5% from the same week during the previous year.

The number above that is causing online marketers to lose sleep is the 5 percent decline in visits. For most of us, a decrease in traffic means an equal decrease in sales.

So what happened to this traffic? Did all of these retailers decide they needed less traffic? Did they stop buying ads? A few perhaps, but not all 500 retailers. This is direct result of consumer's behaving differently due to economic concerns.

Could your company survive a steep decline in traffic? A 10 percent or 20 percent decline?

Take Control of What You Can

For starters, marketers must acknowledge they have far less control than they think. They must also get a firmer grasp on what they do actually control.

You do not have control of the economy. While you may have some influence on the search engines, they are not under your control either.

So now is a good time to get serious about what you do control: the customer experience. By optimizing the experience you reduce the risk of taking a steep incline.

If you need to understand the math or you are trying to get buy in from your organization have them read this column.

Tying Efficiencies to Dollars

Last but not least, you should not be using traffic or even conversion numbers exclusively. Everything you do should be tied to a dollar value. Not only will this show the value of your work, it could also help you sort out priorities.

What are you doing differently in light of the economy? Let me know.

ClickZ Live Chicago Join the Industry's Leading eCommerce & Direct Marketing Experts in Chicago
ClickZ Live Chicago (Nov 3-6) will deliver over 50 sessions across 4 days and 10 individual tracks, including Data-Driven Marketing, Social, Mobile, Display, Search and Email. Check out the full agenda and register by Friday, August 29 to take advantage of Super Saver Rates!

ABOUT THE AUTHOR

Bryan Eisenberg

Bryan Eisenberg is coauthor of the Wall Street Journal, Amazon, BusinessWeek, and New York Times bestselling books "Call to Action," "Waiting For Your Cat to Bark?," and "Always Be Testing." Bryan is a professional marketing speaker and has keynoted conferences globally such as SES, Shop.org, Direct Marketing Association, MarketingSherpa, Econsultancy, Webcom, SEM Konferansen Norway, the Canadian Marketing Association, and others. In 2010, Bryan was named a winner of the Direct Marketing Educational Foundation's Rising Stars Awards, which recognizes the most talented professionals 40 years of age or younger in the field of direct/interactive marketing. He is also cofounder and chairman emeritus of the Web Analytics Association. Bryan serves as an advisory board member of SES Conference & Expo, the eMetrics Marketing Optimization Summit, and several venture capital backed companies. He works with his coauthor and brother Jeffrey Eisenberg. You can find them at BryanEisenberg.com.

COMMENTSCommenting policy

comments powered by Disqus

Get the ClickZ Analytics newsletter delivered to you. Subscribe today!

COMMENTS

UPCOMING EVENTS

Featured White Papers

BigDoor: The Marketers Guide to Customer Loyalty

The Marketer's Guide to Customer Loyalty
Customer loyalty is imperative to success, but fostering and maintaining loyalty takes a lot of work. This guide is here to help marketers build, execute, and maintain a successful loyalty initiative.

Marin Software: The Multiplier Effect of Integrating Search & Social Advertising

The Multiplier Effect of Integrating Search & Social Advertising
Latest research reveals 68% higher revenue per conversion for marketers who integrate their search & social advertising. In addition to the research results, this whitepaper also outlines 5 strategies and 15 tactics you can use to better integrate your search and social campaigns.

Jobs

    • Sales Planner
      Sales Planner (Verve ) - New YorkAbout Verve   Verve is the leader in location powered mobile advertising. We manage one of the largest mobile...
    • Systems Analyst/Support
      Systems Analyst/Support (Agora Inc. ) - BaltimoreIRIS (Increased Revenue Intuitive Software ) is proprietary software that helps marketers...
    • Client Services Support Specialist
      Client Services Support Specialist (Agora Inc. ) - Delray Beach OVERVIEW:  This position requires a highly motivated and resourceful individual...