Imagine you and I, we met up with two business owners:
Jamie is an owner of three stores selling quilts, linens, and curtains.
v.s. Jeffrey, an instructor, selling blender graphic design courses on his website.
They have different revenue models, lifetime value of a lead, and lead engagement cycles.
Jamies’ revenue fluctuates depending on seasonality:
Jeffrey’s graphic design e-learning academy:
Jamie will spend 10% of his monthly revenue. He will only spend 10% in marketing due to the fixed cost in storefront rental, utility, procurement and logistics costs. Jamie relies on word-of-mouth and foot traffic to acquire new customers for his retail store.
Jeffrey will set aside 25% of his monthly budget to marketing. As an online course instructor selling intangible goods, he’d be more inclined to have a higher proportion of his marketing budget out of his monthly revenue. Because every lead he obtains’d be 100% of his gross margin. Let’s assume that he purely offers e-learning courses. He will not incur extra labour cost for every course sold on his website. The main objective he has is to keep growing his student-base each month.
Jamie’s monthly marketing budget:
Spring-summer: $ 1201.5
Fall-winter: $ 1876.3
Jeffrey’s monthly marketing budget: $ 6399.5
Marketing budget for both Jamie and Jeffrey are within reason. Both businesses have regular customers. What Jamie need is to fuel growth in his business by steering his business away from solely relying on foot traffic.
Jamie’s business’ll focus on: 1) Building a reliable website with landing pages and free guides 2) email marketing campaign
Jeffrey’s business’ll focus on: 1) For visitors who opted in for his emails, but have not bought his course, Jeffrey will place them into the re-engagement campaign 2) To acquire new leads, he needs to have new blogs, and landing pages to attract both current buyers and prospective customers to buy his course offerings 3) After he has developed 10+ courses, and if he is planning to development new courses on a month-to-month basis, he should create free trial and subscription model to earn recurring income from his customer-base. 4) Engage with customers on social media to clarify and answer question related to courses or online content
Retail is not dead! Marketing is not a discretionary expense; it is a need to fuel growth in your business. In Jamie’s case, he’d increase sales by having a website, and organic content to up the SEO ranking. It’s important for Jamie to acquire new customers to sustain growth month-to-month. General consumers’d rarely be repeat buyers. Usually buying home furnishing and bedding is a one-off purchase. So it’s better for Jeffrey to sell to interior design businesses in the local market, so he’d be more likely to get repeat customers.
An e-learning website cannot market for itself without content marketing! In Jeffrey’s case, he offers specialized blender render and animation courses. His customers have budget! They are willing to pay for his video learning courses. If they wanted to learn more courses, they will subscribe or buy more individual classes. Lead acquisition cost naturally’d become more expensive relative to Jamie’s.
Jeffrey is an expert in his field, he’d hire fewer writers and writes articles in his own time. He can outrank his competitors simply by devoting time into developing new content on his e-learning website. He’s the guy who’d use marketing automation, emails, and social media to engage with his customers.
Jamie got to increase page rank, due to declining foot traffic at his store overtime. Managing his retail stores is demanding on hours. He’s tied up with little time to do content writing. Jamie has a bigger need to hire content writers for his website. Email marketing is just another extra tool for him. General consumers aren’t really people who read emails. He got to target B2B clients (ie: interior design agencies). This is a niche Jamie should focus on, in order to increase sales volume for his home furnishing business.