Penny Wise & Pound Foolish
by Blair Cariss
We have an interesting spread of clients, some that ‘get it’ and some clients that are preoccupied with cost.
“We don’t have the budget for that…” they say.
Our clients that invest a lot of money in printed marketing materials seem to be playing a different game to the ones that aren’t.
Let’s face it, ever since the internet came around there has been this lure towards the land of ‘free.’ We can stop sending printed materials and start emailing as if they were the same.
Getting off point a little, what is interesting is that the people pushing the internet as a saviour are often significantly younger than most senior business people. They think their preferences are universal and there are no differences in buying behaviour based on age. We’ve used this article in print form in addition to electronically to capture a wider audience. Much of my audience will never see this blog post.
Rather than be seduced by the lure of free or cheap, we need a different way to look at the problem.
Whether or not something is worth spending the money on should be measured by ROI – what you get back from your investment not, what it costs.
The ugly truth about return on investment versus costs
For example, take Rod from Hutchinson Builders, he has been presenting his marketing materials and building quotes to his prospects in presentation folders.
He has invested approximately $4 for each folder. You may or may not think that is a lot of extra money to spend on each prospect. When you simplify things he is presenting a quote from a triplicate book and a couple of his brochures. However the prospective clients sees that they are receiving a professionally presented ‘kit.’
“So what?” you think.
Well if that closes Rod an extra 1 job in 20 that he wouldn’t have gotten otherwise. So he hands out say 20 of those folders at $4 each, that is an extra $80 for the folders, and they have an extra job.
Now Rod’s building jobs average around $30,000.
Would you be willing to invest that extra $80 for $30,000 additional ‘free’ business? The funny thing is many of their competition won’t spend the extra money because it is too expensive.
Not everyone is going to have that big a ‘no brainer.’ But you need to look at what you get back more so than the extra cost. All your competition can see is the extra cost.
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