As any marathon runner will tell you, covering 26.2 miles is no easy task. Preparing for a race that grueling requires an abundance of time, willpower and commitment. You can’t train for it in a few days -- or even a few weeks. But when you cross the finish line, you know that all the time you’ve invested pays off.
Launching a digital marketing strategy is similar: It doesn't happen overnight. In fact, if you think you’ll be able to see returns in a month, your projections will be all wrong, and a lot of things you should be doing (but aren’t) will end up looking like failures.
Recently, my team encouraged a major fashion client to increase its Facebook ad budget. We understand the purchase cycle and cost per lead, and, like other marketers, have been seeing incredible results using Facebook to attract our clients’ target audiences online.
Unfortunately, the fashion client preferred a “wait-and-see” approach and ultimately turned off certain ads after just two weeks. Two months later, when it became clear that those ads had ended up outperforming all of the client’s other advertising, it was too late: The brand had missed its window of opportunity.
To avoid such a costly faux pas, use the following tips to determine how often your customers actually purchase your product or service. That way, you can better allocate time and money to your digital marketing strategies.
1. Measure how long a purchase actually takes.
Many entrepreneurs aren’t aware of the importance of purchase cycles. If your product costs $70, for instance, your purchase cycle will likely be more than a month long, which means you won’t see most of the money you’ll make until after that time frame.
To better appreciate how long it takes for a good ad to perform, monitor how long it takes for someone to make a purchase, from the first time he or she visits your website. Citing our experience with Facebook ads, for example, we find that it typically takes two to four months to actually see a trend in results.
The longer the purchase cycle, the more money you’ll need on the front end, so understanding this time line will help you estimate your cash needs up-front.
2. Put a price on your leads.
If you’re expecting direct responses from your digital marketing, you won’t be able to scale properly. To help you evaluate which strategies to pursue, you should first understand how much each lead is truly worth. (Try this tool if you need help.)
You may be laser-focused on converting your site’s visitors into paying customers -- each of which is worth, say, $100 to you -- when it would be more lucrative to go after $10 email addresses, which have more direct response, quicker conversions and lower costs per lead. If so, you’ll likely want to optimize your efforts based on that strategy rather than on smaller-focus conversions.
3. Redefine how you measure success.
Once you understand how purchase cycles fit into your customer’s journey toward buying your product or service, you may have to start monitoring and measuring success differently. You can calculate the half-life to measure success, as opposed to thinking, “I just spent $300. Why didn’t I sell $300 in products today?”
For example, if you know your purchase cycle averages 30 days, and you’ve made half of your money back after 30 days, you’re on track. Other long-term metrics to take note of include click-through and bounce rates, quality scores and time on site.
To run the digital marketing race, you not only have to train but to change the way you train. By working to understand purchase cycles and how they fit into your marketing time line, you’ll set your business up for success in the long run. The effort takes patience and a lot of commitment, but the waiting game will be well worth the race -- if you can only wait until mile 26.