MBA2082 How to Stop Wasting Money on Marketing That Doesn’t Work + Free Ride Friday

Let me tell you about Intuit QuickBooks. When I was starting out my business, I remember sitting at my desk late at night not working on my business but cleaning up numbers, tracking and reconciling payments and wondering how this became my life. But once I automated the admin side of things of my finances, those nights had disappeared and I felt a whole lot better. Outdo it with intuit QuickBooks QuickBooks is the trusted end to end solution that businesses rely on for getting paid, managing finances, paying employees, finding new customers, and more. QuickBooks provides a team of AI agents and trusted experts, so doing it yourself no longer means doing it alone. Their payment agent gets you paid faster, their customer agent finds leads, follows up and secures more sales, and the accounting agent automates and categorizes transactions. Get your critical business jobs done with QuickBooks on the Intuit platform. Ready to save on new tech? It's time for Dell Tech Day's annual sales event celebrating our customers with fantastic deals and benefits. Perks include Dell Rewards, free shipping, premium Support and more. PCs like the Dell 14 with Intel Core Ultra processors will help you do more faster and with a premium suite of monitors and accessories, you can upgrade your whole setup with amazing savings. Visit Dell.com deals. Hey, welcome to the $100 MBA show, helping you get better at business every single day with our daily 10 minute business lessons for the real world. I'm your host, your coach, your teacher Omar Zenholm. I'm also the co founder of Webinar Ninja, an independent software company I started with my co founder back in 2014 and today's episode is Free Ride Friday. On Free Ride Fridays, we give away a lifetime membership to one of our programs. If you want to win a free ride, just leave us an Apple Podcast rating and review and you enter our weekly random draw. Listen in on Fridays to see if you won. We announce this week's winner a little bit later in the episode. In today's episode, you will learn how to stop wasting money on marketing that doesn't work. Friends, I have a confession to make. I'm an expert at this topic because I've wasted a lot of money on marketing. That doesn't work. They say marketing is experimentation. I've done a lot of experiments, but when you're running a small business, when you're running a startup, money is tight. You don't have all this money to experiment with. You need every marketing dollar to count and to get you a return on investment. So I'm going to give you some tips. I'm going to give you some strategies that I learned the hard way so that you make sure your money goes towards actually working for you. Many business owners don't spend enough money on marketing because their fear of wasting money and it not working out. I'm going to show you what to look out for, how to set up goals that actually are attainable and how to allow your marketing to be easier over. So let's get into it. Let's get down to business. Gas, snacks, tolls. This trip is draining my wallet.

Yeah, but we'll be with family.

You're in a good mood. What's your deal?

What's my deal? I saved at Metro with no activation fees and I got one line of 5G for just $25 per month. Kept the phone I love and a 5 year price guarantee on my top.

Tuxed data detour to Metro. Get that more for your money feeling only at Metro by T Mobile just bring your number $30 first month and $25 after with autopay not available. If with Metro or T Mobile in the past we don't want to waste any more money on marketing that doesn't work. So I'm going to give you the truth when it comes to marketing and how much you spend, where to spend it, what to expect. The first thing I want to communicate, the first thing I want to pass on to you that is probably the most important thing from this episode and that's consistency in your marketing is the most important thing. Most people don't get results and really waste their money because they're not consistent. They market for a little bit and then they stop. They run a few campaigns and then they go on a hiatus for maybe three or four months. They get excited about this new marketing opportunity, they exhaust their budget and then they don't spend any money on marketing for another year. I rather you spend $500 on marketing every single month for the next 12 months than spend $6,000 on one month same amount of money. But the consistency matters. Why? Brand awareness is critical. Out of sight, out of mind. If you are not in your prospective customer's head, if you're not promoting, if you're not getting people familiar with who you are, just knowing you exist, then you've lost the battle before you even started. Consistency is the only way to get that, to have that word of mouth marketing, to have that brand affinity, to be able to be a brand that they know about. So then they are shopping around for something that you offer your business. Your product is top of mind and the only way it stays top of mind is that you are consistently marketing. Too many people exhaust their marketing dollars on one campaign, maybe two, and don't spend a dime for the rest of the year. This is a huge no, no. Okay. This is why I always tell people when it comes to marketing, budget for the year and break it up into 12 months. For example, if I had an ecommerce store that sells some really fancy iPhone cases, instead of me dumping $6,000 on Facebook ads and retargeting and Google Ads in the span of a month or two with the hopes that I'll get an influx of new customers, I'm suggesting spend $500 on sponsoring, let's say a technology podcast, one month ape technology or tech oriented newsletter. And as much as possible to the same audience or the same group of people. Because the reason why your $6,000 campaign on Facebook didn't convert as well as you thought it would is because it takes more than a month to convert a customer for them to be convinced that you're the solution they need. Doing it over the course of a year and just them seeing your brand, understanding what your value is, giving yourself the chance to earn trust with them over time is going to convert more customers in the long run. So that's my number one thing, consistency. Be consistent with your marketing. You should not never do marketing, even if you're not spending money on marketing, whether that's social media marketing, whether you're getting on other shows like podcasts or YouTube channels, or guest posting as a writer on a blog. The point here is be consistent. When I'm working on my marketing, I'm always thinking, how can I get more people to know who I am, what I do, what value I offer? What am I going to do today? What activities am I going to do today to make that happen? Number two, this is gonna be really controversial, but I have to say it. When it comes to paid advertising through Facebook, Instagram, Google, YouTube, whatever it is, right? These types of platforms, if you don't have the budget to hire an agency or an expert to run your ads for you, then you should not advertise with Facebook or any of these platforms. I know that may sound like a bold statement or like, hey, what do you mean, Omar, why? And it's simply because it's become so complicated. I used to run my own ads on Facebook and Instagram and I used take the courses and I used to learn how to use all the dashboards and how to make sure that I'm converting right and build the right audiences. But it has gotten so complicated and it keeps changing the rules, keep changing what works, keeps changing. And I can't be a full time digital marketer, okay? I have to run my business. I'm the founder of the business. I have to focus on the product, my customers. I got to put the right people in place. So if I can't afford getting the right person to, to make sure that I don't waste any money using these ads, then I don't recommend that you actually do this because you're going to end up wasting more money because you're not going to really know how to optimize the ads as well as you can. But more importantly, you're wasting your most valuable asset, your time. This is not time well spent, you being a master at Facebook ads right now, unless you run a Facebook ads agency and then maybe you can have an argument for that. But if you have any other kind of business, there are more practical and more efficient ways to market on your own. People think that Google and Facebook and Instagram and YouTube ads are like a silver bullet. Like it's going to just change your business, just run some ads, it's going to bring in customers. That's like saying putting your business in the yellow Pages. Remember the yellow Pages is going to make your business blow up. No, nothing has changed. It's just a digital version of print ads. Yes, there is better targeting, yes, there is different audience building, but it's not an exact science and it's not foolproof. And in my experience, in order for you to actually get the benefit, you need to spend a reasonable amount of money to learn what works and what doesn't for your business and for your audience. So if you can't afford somebody to run it for you, and you know there's people that will do it for you from $2,000 a month upwards, depending on your budget, how much money you're spending on ads. So you gotta budget that into your marketing spend. Number three, try to do marketing activities, especially in the beginning, that you can easily track, whether using affiliate links or UTM links, that you can track where the conversion came from. Simply using like GOOG analytics, you can find a YouTube video on how to do that. Very simple. The point here is that you want to see the impact of your dollars so you can see the exact roi. Why? Because especially in the beginning, you want to experiment a little bit with a little amount of money before you put more money into it. Even if you have a hard time or it's not super simple to track Conversions. Track what you can track. Let's say, for example, you're going to try to drive traffic to something that's hard to kind of track, like a podcast. Like, we run ads for our podcast $100 NBA show. It's not an exact science. It' hard to track. Some podcasters are set up for it, some are not. But an easy way to track what you can track is to run a promotion and just take a look at your analytics while that promotion is going on. Is there a change? So, for example, if I have an ad for the $100 NBA show on a different podcast, I know the dates it's airing. I look at my metrics beforehand, or I look maybe the week before, the month before, same day of the week that it's airing and see if there's a difference. Are people subscribing after the ad? I know this is not an exact science. I know the data gurus out there are going to be like, this is ridiculous, Omar. But it's some tracking. Sometimes you just can't track because of the tools out there, but it's better than nothing. The other thing I like to do is when I have something I can't track, I try to bundle it with something I can track. So if I'm going to run an ad for the podcast on another podcast, I ask them to include maybe a mention in their newsletter so that I can track it with a link. My next tip, and this one's huge. Run ads with a purpose. Okay, so many people just run ads thinking that all your ads are going to convert into customers, that this is going to equal a sale. That shouldn't be your goal for every ad. That's just unreasonable. This is why I like to run ads for specific reasons, specific purposes. So I run specific ads just for brand awareness. Like, I just want people to know who we are, to hear the brand name. I might have a call to action, but I'm not really concerned about conversions with that call to action. Because my goal here is just getting people who don't know me to know me. That's it. That's the goal. And knowing that when I run those kinds of marketing campaigns, I'm running it to an audience that doesn't know me, not people that have been up to my website or maybe are using tools or are customers of companies that are affiliated with mine. My branding and brand awareness campaigns go to fresh audience. If I'm running a campaign to actually make a sale, that's the other extreme. I'm going to do it for my customers, right? People that already bought from me. So I might do retargeting ads to those people. Lookalike audiences or the actual audience. I upload my actual customer list to just advertise to them. So yes, I'm sending them an email but then they also see my ad on social media or elsewhere or banner ads. Now why is this important? Because when you market with a purpose, you actually save money. When you're trying to optimize people, just see seeing your brand and brand awareness. It's a lot less expensive where your campaign has just one job. Okay? So many people want their marketing campaigns to do everything. Brand awareness, get them to fill out a form and give me a lead. Convert that lead into a customer. No, that's not going to happen all in one shot. Think about how you buy, okay? Think about when you bought something for the first time. You bought from a brand or a company for the first time. Probably took a lot of touch points, a lot of brand awareness months, maybe even years before you made a decision to buy from this brand. Next tip. So many people put their foot off the gas they market in a certain way. They ran a campaign and it works for them. It actually converts it gets them leads or sales and then they're like oh that's great. And then they jump around and try something different. What? Don't do that. Double, triple down on what works. Keep doing it until it doesn't work. That's the biggest waste of money I've seen in our industry where people just get distracted. They try a different way of marketing. It's not time to experiment. When you find something, when you strike gold, right? You don't just say okay great, let me go and see if there's more gold over there. No, keep digging where you're at, there's gold there. Get the gold as much as possible. Right? Make sure you got all the gold before you move on. Gas, snacks, tolls. This trip is draining my wallet.

Yeah, but we'll be with family.

You're in a good mood. What's your deal?

What's my deal? I saved at Metro with no activation fees and I got one line of 5G for just $25 per month. Kept the phone I love and a 5 year price guarantee on my top.

Text and data detour to Metro. Get that more for your money feeling only at Metro by T Mobile. Just bring your number. $30 first month and $25 after with autopay not available. If with Metro T Mobile in the past 180 days. Guys, I got one more big tip. When it comes to how to not waste your money on marketing, that doesn't work. A lot of people say, I don't know how much to spend on marketing. I don't know how much to budget. And that's because most people don't know how much their customer is worth. This is called the lifetime value, the LTV of your customer. You need to know that number. How much money does the average customer spend with you? I'm sure that number could be found out if you look into your payment processor, your accounting software, or whatever it is. You should know this number like the back of your hand. Okay? Say, for example, your LTV is $1,000. The lifetime value of your average customer, or the average LTV is $1,000. Now, you know that every time you bring in a customer, it's worth for you, on average, $1,000 for your business. Now that you know that number, you're going to subtract any cost that it takes to actually fulfill that customer, to give them the product, the service. Let's say after I do that, it's $800. Cost me $200 to fulfill this customer. $800. What I like to do is try as a 3x on my investment. That's my starting point. Let's call it 250. So 250 times three is 750. So that's ballpark. So my budget is $250. What's that number? That number is how much I should be willing to pay in total to get a customer, because I can profit three times as much if I get a customer. Now, what does that mean? So that means if you're running a campaign and you spent $1,000 on that campaign, and you got four customers out of that thousand dollars, you know that you're on budget, that you actually spent 250 to attain a customer. That's going to eventually make you $1,000 in revenue and 800 in profit. So now that you know it costs you $250 to acquire a customer, this is called CAC cost to acquire a customer. The only question is, how many customers do you want to bring in every month? If you're like, I want to bring in 100 customers, well, that's 100 times 250. So that's $25,000. Then you might be saying, oh, that's a lot of money. But that's how the math works. So pick a number of customers that you want that you can afford. So you might say, okay, I'll go with 25 customers. So 25 customers at $250 a customer, it's going to cost you $6,250. That's your budget. There you go. Now your job, now that you set this budget is to make sure that when you're doing your marketing activities that you're not spending more than $250 to gain a customer. Ideally, it's less because then you can acquire more customers with the same budget. Pretty cool, right? Go ahead and do the math for your business after today's episode. Thank you so much for listening to the hundred dollar b a show. If you love the episode, the best way you could support the show is to share it with your family and friends. Go ahead and share it on social media right now. Let them know that you're listening to the $100BA show to help improve your business education, help you grow that business that you want to grow and that others should check it out too. Today's episode's not over though, because it's Free Ride Friday. Let's see who won this week's free ride to our amazing course Easy Course over at easycourse Co, showing how to build your own online course in 30 days. And the winner is. Joy Compton. Joy says Great discovery, five stars. Love this podcast. Great topic, great host, great guests. Can't wait for more. Thanks, Joy. Your mission is to email me over at omar00mba net so I can hook you up with the lifetime membership to Easy Course so you can build your own online course in 30 days. It retails for $500, but Joy just won it for free. If you want to win a free ride, just leave us an Apple Podcast rating and review and you enter our weekly random draw we call Free Ride Friday. Listen in on Friday just like today to see if you want. It's that easy. Before I go, I want to leave you with this. This is my final tip. It's kind of a bonus one. And I want to just say this from the heart because I think a lot of people feel this, but they don't actually do anything about it. And that's if you feel uncomfortable about a certain campaign, a certain way of marketing. Maybe you feel like you're out of your depth, like I don't know if I know what I'm doing here. There's no pressure. You don't have to do it, okay? Only do things you feel confident that will help your business. The reason why you feel that way is probably because maybe you don't know enough or you don't feel again, confident that it's going to help your business or help, you know, move the needle. My advice? Get confident. Get confident before you invest your money. That's a good way not to waste money, is to make sure that, hey, you have a firm belief this is actually going to work. This is actually going to allow me to get in front of the right audience, to convert the right people to, you know, learn more about my products and services and eventually become customers. Thanks so much for listening and I'll check you in Monday's episode. I'll see you then. Take care. Of gas, snacks, tolls. This trip is draining my wallet.

Yeah, but we'll be with family.

You're in a good mood. What's your deal?

What's my deal? I saved at Metro with no activation fees and I got one line of 5G for just $25 per month. Kept the phone I love and a 5 year price guarantee on my top.

Tuxed data detour to Metro. Get that more for your money feeling only at Metro by T Mobile Just bring your number. $30 first month and $25 after with autopay not available. If with Metro or T Mobile in the past 180 days.