The number of marketing options available to today's small business owners can be dizzying.
You'll find lots of "experts" willing to tell sell you the next best marketing strategy, but ultimately you will need to be the person who defines the marketing mix that's right for your company.
The best way to gauge the effectiveness of your marketing mix is through measurable outcomes (e.g. lead generation, online analytics, bottom line value). The problem is that marketing cycles can be long and by the time you realize your marketing mix is out of whack, it could be too late to do anything about it. So in the meantime, you'll have to rely on other evaluation factors.
- Cost per lead. It's impossible to evaluate your marketing mix on performance alone. A marketing mix can be a high performer when it comes to leads, but if it eats up an inordinate percentage of your budget you'll have to make adjustments to make it more sustainable.
- Cost per customer acquisition. Cost per lead is a valuable evaluation metric. But a cost per customer acquisition metric tells you how effective your marketing components are at generating qualified, convertible leads. If your primary marketing objective is branding, the cost per lead metric may carry more weight, while a cost per customer acquisition metric clearly dominates a sales-focused marketing strategy.
- Market share. Is your company gaining or losing market share? Either way, your marketing mix could be to blame. In a declining market share scenario in which price isn't the problem, start by evaluating your place (distribution) decisions before moving on to an analysis of your promotional efforts and product offerings.
- Component ranking. The trickiest part of evaluating the success of a marketing mix is determining which component(s) are working and which aren't. Sometimes it makes sense to construct a matrix that ranks your mix components from most effective to least effective and identifies areas where improvement is needed.
- Competitive analysis. If you are at a total loss about how to evaluate the effectiveness of your marketing mix, start by comparing your mix to a competitor who is gaining market share. There may be solid reasons for you to differentiate, but at least you'll have a baseline from which you can launch your evaluation.