02 August 2009
What's it worth?
08/05/2009 04:39 Filed in: Thoughts
on Internet Marketing
The beauty of Internet marketing is the ability to
measure everything about your campaigns. Marketers
can see real-time data showing the costs for each web
site visitor, lead or sale.
But flip this equation around: what is the value of your web site or e-mail database? If Internet marketing can tell you how much it costs to gain each web site visitor or e-mail subscriber, are you receiving a good value for your Internet marketing efforts?
For example, let's say a minor league baseball team conducts a pay-per-click (PPC) advertising campaign to acquire more subscribers to its e-mail newsletter. Those fans can certainly be considered good season ticket sales leads. Let's suppose the team's PPC campaign results in an average cost-per-click (CPC) of $0.95 and they received 750 web site visitors as a result. Of those 750 web site visitors, 50 signed up for the e-mail newsletter. The team's cost-per-conversion is $14.25 ($712.50 campaign cost / 50 conversions = $14.25 per conversion).
So the team paid $14.25 for each e-mail newsletter subscriber. Is the average e-mail subscriber worth $14.25? Are individual web site visitors worth $0.95 each? How to tell?
Fan surveys would go a long way to answer this question. If the team asked its e-mail subscribers if they planned to purchase a season ticket package, they could determine a reasonable estimate of the average subscriber's value. Let's say our hypothetical team conducted such a survey and found 15% of their subscribers planned to purchase season tickets. Let's suppose that the team's total e-mail database includes 600 fans and season tickets cost $500. (Totally hypothetical numbers here, folks!)
In our example, the average e-mail subscriber has a potential value to the team of $75 ($45,000 in potential season ticket revenue / 600 subscribers = $75 value per subscriber). And the team spent $14.25 to acquire each new subscriber. In this case, the team's Internet marketing campaign could be considered a success!
The same exercise could be conducted for single-game sales, or based on web site visitors instead of e-mail subscribers. Knowing this information should make any marketing campaign more successful. Do you know these numbers for your organization's web site or e-mail list? Something to think about, perhaps...
Thanks for reading and good luck with your marketing efforts!
But flip this equation around: what is the value of your web site or e-mail database? If Internet marketing can tell you how much it costs to gain each web site visitor or e-mail subscriber, are you receiving a good value for your Internet marketing efforts?
For example, let's say a minor league baseball team conducts a pay-per-click (PPC) advertising campaign to acquire more subscribers to its e-mail newsletter. Those fans can certainly be considered good season ticket sales leads. Let's suppose the team's PPC campaign results in an average cost-per-click (CPC) of $0.95 and they received 750 web site visitors as a result. Of those 750 web site visitors, 50 signed up for the e-mail newsletter. The team's cost-per-conversion is $14.25 ($712.50 campaign cost / 50 conversions = $14.25 per conversion).
So the team paid $14.25 for each e-mail newsletter subscriber. Is the average e-mail subscriber worth $14.25? Are individual web site visitors worth $0.95 each? How to tell?
Fan surveys would go a long way to answer this question. If the team asked its e-mail subscribers if they planned to purchase a season ticket package, they could determine a reasonable estimate of the average subscriber's value. Let's say our hypothetical team conducted such a survey and found 15% of their subscribers planned to purchase season tickets. Let's suppose that the team's total e-mail database includes 600 fans and season tickets cost $500. (Totally hypothetical numbers here, folks!)
In our example, the average e-mail subscriber has a potential value to the team of $75 ($45,000 in potential season ticket revenue / 600 subscribers = $75 value per subscriber). And the team spent $14.25 to acquire each new subscriber. In this case, the team's Internet marketing campaign could be considered a success!
The same exercise could be conducted for single-game sales, or based on web site visitors instead of e-mail subscribers. Knowing this information should make any marketing campaign more successful. Do you know these numbers for your organization's web site or e-mail list? Something to think about, perhaps...
Thanks for reading and good luck with your marketing efforts!