There are so many old adages to choose from: “Practice makes perfect,” “ At first you don’t succeed, try, try again,” “Nothing ventured, nothing gained,” and “You got to be in it, to win it.”
All of those pithy, inspirational phrases go back to one main idea – don’t rest on your laurels, try new things. It sounds so simple, but it can be a difficult rule to live by, particularly when a lot of money is on the line.
Innovation – Keeping Your Business Relevant and Growing
In the world of marketing and, particularly the ever-changing platform of digital marketing, innovation is the key to success. You, as a business owner, know all too well that the only constant is change, that the only way to stay relevant is to come up with something new, and that growth of a business relies on that business’s constant evolution. Simply put, people’s tastes change, and business has to change along with them.
At Oamii, South Florida’s top digital marketing agency, we keep track of trends, changes, and disruptions in the marketplace. We know, from our years of experience, that digital marketing is here to stay, and the players in the game must understand how to leverage every digital marketing dollar.
In order to get the most out of a digital marketing strategy, businesses need to understand a very important metric – cost per experiment. The cost-per-experiment metric measures the aggregate impact that a brand or marketing innovation has on the market. Stated differently, cost per experiment allows you to see how a new brand or marketing idea impacts your return on investment (ROI).
In this article, we will first talk about the necessity of marketing, and specifically the necessity of digital marketing today. Then, we will discuss why cost per experiment is a vital metric that your company needs to track. Remember, Oamii is the South Florida’s leading digital marketing agency, and our professionals are available to discuss with you your next big brand and marketing push. Call today at 561-228-4111 or fill out our online contact form.
The Power of Marketing – The Pippin Example
The best product or service in the world is guaranteed to fail if no one knows about it. That is what marketing is all about. In fact, skillful marketing has been known to even boost an otherwise sagging product.
To give a quick example, back in the 1970s, composer Stephen Schwartz (who later would write the hit Broadway musical Wicked) wrote the musical Pippin. Schwartz was just coming off of another Broadway hit, Godspell. Moreover, the production of Pippin boasted Broadway legend Bob Fosse, as director-choreographer; and Broadway, film, and TV superstar Ben Vereen in a leading role. It was a combination that spelled “sure-fire hit.”
Unfortunately for the production, reviews were tepid and the show seemed to have difficulty finding an audience. All that changed, however, with some creative marketing. In fact, Pippin is well known for breaking new ground with regard to advertising for a Broadway show. The impactful 60-second commercial – featuring Ben Vereen – turned the popularity of the show around. Pippin became one of the longest running shows in Broadway history. Many attribute that success to how the show was marketed.
In short, marketing is vital to any business. Therefore, a business needs to make room in its budget for marketing. The show Pippin did, and it was a game-changer. Yet, like any other business expense, you want to keep track of how effective those marketing dollars are.
The same goes true for digital marketing. Your business will spend time and money on digital marketing campaigns and strategies. Yet, you don’t want to spend good money after bad. You want to know whether a digital marketing approach actually works, and leads to customers for your product or service.
Clicks, shares, and impressions are metrics that you can track to determine whether your digital marketing approach has an impact. However, one metric – cost per experiment – gives a more helpful, 30,000-foot view on how your digital marketing dollars are translating into profit.
The Cost Per Experiment Metric
The latest trends in digital marketing seem to be more and more focused on a cost-per-experiment model. To begin, let us just define our terms. An “experiment” in this context is either trying out a new innovation related to a brand’s product, or an innovation in how the product is marketed. Yet, for purposes of this overview, we will label an innovation as one or both of those things.
An innovation is something that is new and that may or may not be a hit in the marketplace. You have to try it out – experiment – to see the results. Yet, you have to be careful to not put all your eggs in one basket. You don’t want to spend too much on an experiment that might fail. Thus, you want to monitor how much your experiment costs to see how it impacts your ROI.
By measuring cost per experiment, it allows you to minimize the cost of testing new ideas or to make the cost predictable enough so you can manage how much you want to spend on a certain idea. Just in the same way that you would not “bet the farm” on one roll of the dice, or put all of your resources into one stock in a stock trade, you want to be conscious of how much each experiment in the market costs.
Stated differently, you can view a market experiment as a “bet” in the market. You don’t want to make bets that are too big until you know that the bet will actually pay off. Therefore, keeping track of your cost per experiment will allow you to manage the loss regarding “bets” that fail, and inform you as to what new ideas will have market traction.
In sum, keeping your cost per experiment low for early-stage ideas, will allow you to run more experiments, and better learn what works for your business.
Oamii, the South Florida digital marketing agency professionals, can give you guidance and help you with your business’s own cost-per-experiment strategies to make sure that new ideas will lead to a strong ROI. Call us today at 561-228-4111.