Episode 042 - What To Invest In Marketing

something that absolutely needs to be done. And if you can't invest your time, you're gonna have to invest your money.

Absolutely. And I think there's a lot of misconception between marketing and advertising. You know, I talked about this before, that advertising is a part of your marketing. You know, just because you run ads in a newspaper or on a radio station, you're technically not doing the full scope of marketing. All right, here we are, Season 4, Episode 41. So you can be on the debate whether 40 was Season 4 or 41, but regardless, we're, we're just calling it Season 4. And we're gonna have a lot to talk about. But today's episode, we're going to talk about investments, time, and money. I know a lot of you may be wondering if you've been new to marketing, or you've been doing some advertising, you know what that costs. But if you want to really focus on marketing your business more effectively, how much should that cost in your resources? And you know, it's time and money, right? Those are the two things that are out there.

Yeah, definitely. And I mean, first thing I want to get out of the way is the fact that I think marketing more often than not in, you know, a startup or even just a small business, in entrepreneurs' minds can often be that kind of area that they're really lacking in. Because, you know, sometimes you just don't put a focus on, you know, growing. Well, you put a focus on growing, but not in the, the most efficient way, which is in investing in marketing. And I'm sure you've seen it a lot, even, you know, we, we talked about social media marketing, how, you know, a lot of clients that we come across are just completely ignoring it until they come to us. And, you know, that's a perfect example of an investment in marketing and something that absolutely needs to be done. And if you can invest your time, you're gonna have to invest your money.

Absolutely. And I think there's a lot of misconception between marketing and advertising. You know, I talked about this before, that advertising is a part of your marketing. You know, just because you run ads in a newspaper, on a radio station, you're technically not doing a full scope of marketing. And I think the best example that I can explain what marketing is, it's how you want those people who come in touch with your brand to feel, right? And that's feeling from the, you know, confidence through experience to, you know, just, you know, the emotion, those type of things. I mean, look at, you know, when you look at certain big brands that are out there, like, that you buy, I mean, like, you look at Lululemon, Nike, to Mercedes, to, you know, Honda, right? They all have a specific feel and demographic they're going for, right?

Absolutely, yeah. And I mean, I think that's where a lot of people who are starting up or who, who are working in a small business get overwhelmed is because marketing is such, such a wide scope, right? It includes so many things. But, you know, obviously, like you said, it really comes down to how you want people to feel. But, you know, when you're talking about marketing strategy, you have to think about what's going to be the most effective for you. Is social media a place where your audience is? And, you know, most people now, no matter what your audience is, they're on social media, you know. But you have to look at where you're gonna be able to get that message across and to make your target market feel the emotion that you want them to feel, because if it's going to people who it doesn't really matter, then, you know, you're not gonna have an effective marketing strategy.

For sure. And if you're in that small business space, which most of you are that listen to this podcast, you know, don't compare yourself to those big box stores. I mean, you're never gonna compete on the level of marketing budget that Walmart's or Target or any of those big stores have. I mean, they've got unlimited amount of funds. So they've spent thousands if not millions just on the research side. But what you wanna do is come across with what is the value that you really want in your business. So if it's confidence or responsiveness to anytime somebody inquires, I'm going to respond within 2 hours, right? If that's a feeling that you want people to come across, you need to get that into your marketing, right? Everything that you do that's out there. So, you know, let's get to the nuts and bolts of this is, you know, what should you look to spend, right? And there's, there's so many different things, whether you're going to do it all yourself, then you don't need to really hire somebody. But there will be elements like, you know, advertising spend, right? And we look at, you know, a really good guide. And if you know, if you look up BDC, the Business Development Bank of website bdc.ca, or corporation I guess it is, they recommend that if you're a B2B, so business to business, you sell to another business, should be spending about like 2 to 5% of your annual revenue on marketing. And if you're in a B2C space, to consumers, it needs to be about 5 to 10%. And the reason there's a variance there is because selling to a consumer takes a lot more time, right? If you're in business, you can validate really the offering a lot faster. You're used to those type of selling experiences. But if you're a consumer, you need a lot more touchpoints. So that's when we get into the social media side, the retargeting, the multiple touchpoints that you need to actually convert that customer. So that's why your spend needs to be higher.

Yeah, absolutely. And I mean, another thing to consider too, when you're looking at a small business and if they're targeting customers and they're saying they want to do it all themselves, which is obviously attainable, and they're saying, well, You know, their mind is just kind of tunneled in on that advertising spending, but you also have to look at, you know, design feed. Like, do you want to buy a design software? You know, we use Canva and it's one of the best, you know, tools out there and it makes our lives 10 times easier, right?

Yeah, it's like $30 a month. Exactly. Like, it's crazy cheap for what it does.

You know, and especially for people who are amateur designers or, you know, because obviously if you're, you know, an entrepreneur, you probably don't have a massive background in graphic design, but you want to do it yourself, then, you know, you have to consider things like what's going to take the content to the next level, what's going to have that return on my investment, you know, because I think there's, there's a major difference between obviously paid advertising versus your organic marketing. And I think sometimes people can, you know, you can't really have one without the other. Especially when it comes to the social media side of things, because, you know, if you're— you have a paid advertisement right off the bat before you have anything on your social media page, you're not really going to get much interest. Because even if you do get that click, no, they're not going to see anything. It's not enticing, right? So, you know, the way that I look at it is you have to invest your time first on that organic marketing, um, building up your stock of content, building up, you know, uh just your brand identity and then kind of focus on the more analytical paid advertising that you can actually see a direct return on your investment.

Definitely. And, you know, when you look at, you know, even coming across as that brand and that feel, I mean, if anybody's ever gone through like a logo design process, like a proper one, you know, when you're working with a designer or even you've outsourced it to a site like crowddesign.ca, which you pay X amount of fee and designers will actually like design for you and you pick a winner, which is a great service. We've used that for clients before. But a lot of that intake is, you know, what's the feeling that you want across? Is it corporate? Is it professional? Is it fun? Is it contemporary? Those type of things. That needs to be considered before anything else that's going there. And then, you know, you get that design and you're like, yeah, these are the colors. This is the feel like that I want visually. Now let's, let's look at Canva. Canva, the, the tool that it is, allows you to actually put in the actual colors of your brand so that every time you make a social post or whatever, you're picking the exact color. Now you may be saying, well, is that really important? Well, yes it is, because you'd be surprised how much somebody seeing that color over and over again will start to think of your brand. You know, right now there's a— I'm being retargeted by CDI College, which teaches Digital Marketing, and their blue is very, very close to us, and we use a lot of blue and white in our design. And I'm scrolling through and I'm like, hey, there's our— no, that's not our ad. Like, I'm getting tricked by it because they're very much on par with the exact same fonts and colors that we use. And that right there is proof that I immediately thought it was us, right?

And see, people will, um, think of that in their paid advertisements, but they won't think it's as important in your organic. But it absolutely is. You know, every post that you have Even, you know, if you're just posting an image, it should have some type of feeling at least that ties it to your brand. But ideally, you would have your logo included. You would have a face that people recognize that, you know, they tie to your brand. Colors, you know, anything that can kind of reinforce that relationship between what you're putting out there and what, you know, people are perceiving it.

Has. Yeah, and one of the posts that you've done for one of our clients, Halls Harbour Lobster Pound, and I'm okay mentioning them in here, they're very much a cross between a destination and an actual business. So if you've never been to Nova Scotia and you've never been to this area, it's a very scenic cove area which has huge tide changes. I mean, when the tide's out, the boats are on the ground, you can walk on the sea floor. When the tide's in, it's up to the wharf level. But they have fresh lobsters, and that's the whole draw there. From their business is the restaurant side. And when we started doing their social, we went out to shoot some video and some clips. And I took a trip down to the shoreline and I put my phone down and recorded a couple seconds of just the waves hitting the rocks in front of me. And one of the first posts you did was that with the sound. And it was just for 10 seconds, I think it was, just the sound of the ocean. And so many people go out there because they love the ocean. And the comments on that were like, like they loved it and it just brought them back, you know. And then you had their logo and their brand that came up after that. It was simple, but it was on brand with what they're doing. It was, you know, it wasn't this huge commercial production, one simple clip, right, and that social content. But the fact that you visually, audibly, but then also put the, the logo branding in there was a really good post to use.

Yeah, well, thank you. But yeah, and I mean, people try to make it complicated sometimes too, right? And it really doesn't have to be. If you are very certain of what your brand identity is, what you want people to feel, it's not hard at all. Because, you know, even as the person who's working from the inside of things, um, you know, looking out you can also see how it makes you feel, right? You're a perfect example of, you know, when you're looking at the content, when you have your final product, and, you know, when I'm watching back that clip and I'm like, oh, I love the sound of waves, you know, it's— you, you know how it makes you feel. So it really doesn't have to be that complicated. It's just getting it down at first to exactly what it is you want people to feel and you want to be associated with. And, you know, even in In my education, we did all kinds of exercises about that kind of association process. So, you know, in marketing research classes, a lot of surveys just include, you know, when you think of this brand, what's the first animal that comes to your mind? And like the first time I'm going through it, I'm like, what, what is this? You know, like this is the weirdest thing I've ever seen. Like this is just weird theory that people learn and completely forget about. But as you go through and you see, you're like, okay, so if somebody says like a lion, that they think of that when they think of a brand versus like a puppy, that says something, right? And it might not be the most valuable metric that there is out there, but in terms of trying to find ways to really know the emotional side of your business, those types of data and research actually do provide better results than anything numerical, right?

Yeah. You know, and you can spend, you know, you can look to spend money on that top end of that funnel where we're trying to build awareness and get people to come into your store. So let's just use an example of a physical store. You know, you can also focus, you know, if you don't want to do that part of it, you can focus on trying to enhance the experience in the store that people come back because it's unlike anything that they've ever seen. So imagine you've got like a household, um, like we sell kitchen stuff and bedding and all that. You focus on, okay, you've got your kitchen section where there's baking, you know what, getting something like a, you know, an apple pie scent generator or something that when you— this customer walks into that section, there's something that, that they're smelling that's triggering that sense of comfort and get in that mindset. Right? I mean, there's a hotel here called Chocolate Lake, and they have a chocolate scent generator in their lobby, right? They're playing through on that. And the fact that I tell people that story, that's marketing to them, right? So you need to look at where do you effectively want to spend the money. And if you want to look at hiring someone, you know, you can't just look at direct return on, okay, I spent $1,000 a month on this person, they need to make me $2,000 in sales, they're taking time back, or they're giving you time back, right? So this is stuff you're not having to do anymore. So you need to look at that and consider that into play, because it's hard to actually connect what you're investing in someone else or an agency to help you to direct dollars that are there, right? And you're not going to see that within the first, like, month, right? There's going to take some time to get it going.

Absolutely. And I mean, just kind of changing the direction a bit too, You know, you are going to have those small businesses that are able to hire, you know, or outsource their marketing. But some people, you know, they want to keep it inside the company. And for those people, the most important thing is developing that accountability, right? Because we talked about the percentage that, you know, you should be putting aside for your marketing efforts. But, you know, even if you compare it to your personal finances, how many times have you set money aside and then something comes up comes up and you take from your savings, right? And, you know, that very basic concept that we've all heard, you know, many times before of pay yourself first, you know, you, you take that money and you put it in your savings and it's like it's not there. You have to do that with your marketing because, you know, it is that investment that is going to make your business grow. You know, nothing will make your business grow like your marketing efforts. Um, and, you know, keep in mind that that's that umbrella term. It's not just advertising like people assume. So, you know, if you're constantly cutting down on your marketing expense or marketing expenditure because it's needed in other areas and you're wondering why you're not seeing growth, that's why.

You know, and one, one thing that, that a lot of businesses do is, you know, especially here, uh, you know, we pay, uh, you know, 15% sales tax. So people are paying us tax on the service. So a lot of times businesses will actually transfer that money into a separate account, right? So that when they pay quarterly or whatever, that money is there, it's not in their operating account. So I mean, you're getting in that mindset every month, run your sales and take 15% of that, put it in a separate account. Just take 20% of that, put in a separate account, pay it out, and that remaining 5% is your marketing budget, right? You know, you don't have to put a whole new process, just up it by 5%, 3%, whatever that amount is that you want to spend that's in there. And then it's you're not judging, you know, where you're at financially by just your main account.

Absolutely. And I mean, you know, that pretty much covers accountability financially, but it, you know, there's also that side of time, you know, that investment that you're making in your marketing if you're choosing to do so yourself, or even if you need to, you know, gather content. Like for us, for social media, a lot of times the content is gathered by the client themselves, right? So You need to make sure that, you know, if you're investing, you know, your money in someone, you also have to invest your time and you have to be, you know, you have to think of it as banking that time as well, right? You're putting that in a separate account, it's in your calendar and you 100% are doing that, nothing is going to change that. It doesn't matter if there's another client who, you know, is really eager to get in with you and the only time slot you have is that marketing, don't say They see it as it's a time slot that you can just, you know, I'll get to it because you don't get to it.

No.

If you don't put the—

You need to treat yourself as your top, one of your top clients, right? Would you stand up your top client? No, you wouldn't. So why do it to yourself? And that's what we tend to do is we tend to cut ourselves out of there. So, I mean, if you're going to make that investment, you know, it really comes down to, you know, the type of clients that we work with are the ones that are motivated and want to make that change. And if they come and say, hey, you know, I want to market better, I want you to do this, and then they don't give you the time to actually sit down and like work through the ideas and come up with it, because you can't bring anyone into your business and expect them to know every single thing, right, and the exact way you want it, want it done. There's going to take some time to get them up to speed, right? So, you know, the more time you actually commit to investing in that person or that agency the better use of those dollars, right? You're not just burning time.

And, you know, obviously, like we mentioned before, we have a lot of clients who assume that, you know, numerical, they want, they're spending X amount of money, so they expect X amount of money. But those are often the type of people who see, you know, the numbers and marketing, and they completely are, you know, blind to the idea of the emotional side of marketing, which, you know, I would say personally, in my opinion, is way more important. You know, what you're communicating emotionally and making people feel, you know, and what you're making people associate to your brand is way, way stronger than, you know, trying to convert an advertisement. You know, because it's, you know, it's in some ways immeasurable. You can't really take the time to get that numeric value out of somebody's feelings, but that's what gives you that, you know, like referral or word of mouth, or even, you know, just talking to your family and friends, and you know, a lot of times word of mouth is the strongest form of marketing, right? So.

[Speaker] Let's take for example like Zappos, right? The online shoe company. I don't even know if they're still around, but regardless, when they, you know, in their heyday, that's what they were focused on was exceptional customer service, right? You know, great selection of shoes, all done through, like online ordering, shipped to your house, you know, returns, whatever the case was, you know, if they were focused on the value of that transaction, so, you know, I'm going to spend $50 on an ad and I need to make $50 or $100 back, we need to look at is the customer lifetime value. So, you know, you may spend $50 to acquire a customer who's going to buy a $50 or $100 item. But if that experience is great, they'll come back 5 times in the year, right? And they may stick around for 10 years, right? So you need to consider consider that residual long-term value of that investment, right? And that's just a mindset shift that if you're not into doing ads and thinking about it that way, you don't consider that, right? But that's what it is. How long are you going to keep them around and how much more are they going to buy? And also, who else are they going to tell that you obviously are not tracking and you can't track from, you know, an ads platform?

Absolutely. Yeah. And it really is about that influence that they have. You know, especially, you know, where I grew up in a very small town working retail, if one person had a bad experience at our store, a lot of people were figuring out about it, right? And, you know, while with some bigger companies or, you know, we work remotely a lot of times, so it might not be that simple, but there really is something to say about your reputation and how not only, you know, your brand makes people feel, but your, your customer service and your actual interactions with them makes them feel.

So I think to wrap this up, some of the takeaways from this episode are you need to look at your business and figure out what do you want the person who is engaging with you, seeing you, working with you to feel? What's that experience like? You know, is that evident in the brand that's out there that, you know, that's currently, you know, circulating? If not, then you need to make some changes. You may be too close to your business to actually see that. So maybe getting someone to, you know, look at it from the outside, you know, is helpful. And that's where it comes in a lot of times with us is, you know, in those initial consults, we'll, you know, we'll do an initial look online, the website, and get a feel for it. And then when we meet and do a Zoom call or whatever, we can easily identify if there's a disconnect, right? It's like, tell us about your business, what you do, and they tell you like, it's not what's coming across online, right? So, um, you know, some of those things you need to look at. And then definitely make sure you have allocated some budget. You know, I would say, you know, in that, you know, 2 to 5 if you're business to business, you know, 5 to 10 in the business consumer of your annual revenue for your, your marketing.

Yeah, yeah. And, you know, just to add on to that, as well as that investment and putting that money aside for your marketing, also put that time side, right?

For sure. All right, and if you want to get some advice or help, we are here. So you can reach us at bluecowmarketing.ca, and hopefully you'll tune in next time for the next episode. Until then, bye!