TUESDAY CHALLENGE: Inbound and Outbound Marketing
As a small business owner it is important to understand the difference between Inbound and Outbound marketing. Before the internet most marketing efforts were outbound. Outbound marketing interrupts your target market to promote your product/service. Inbound marketing requires your target market to reach out for the products or service they desire.
Typical tools for outbound marketing include: advertising, trade shows, telemarketing and direct mail. Today, much of your target market will use the internet to search for your product/service. Marketing tools for inbound marketing include blogging, pod-casting, website and social media.
A critical fact to know is the difference in cost to get a lead using outbound marketing versus inbound marketing. Research shows that inbound marketing generates leads at a 61% lower cost than those generated by outbound marketing.
A second very important fact to know is to what type of marketing method your target market is more receptive.
Your challenge for today is to determine the type of marketing you use, and break it down into two categories, inbound and outbound. The next step is to keep track of new leads or customers that you receive and assign them to one of the two marketing strategies.
In determining the cost of each marketing category, you must consider both the hard dollar cost and the time cost involved. For example, if your outbound marketing program generated 5 leads this month at a cost of $100, then your cost per lead was $20. If you spent 40 hours in lead generation work such as a trade show, your time cost per lead was 8 hours. Use the same method to determine your cost in time and money for your inbound marketing strategies.
This exercise will help you determine what the most effective method of customer acquisition your business uses and what is its true cost.
Knowing the cost of customer acquisition is important information in planning future company growth.
Knowing what type of marketing tools work and don’t work is equally important. You may want to break down you acquisition cost into specific inbound and outbound marketing tools.
This process is an important, and an ongoing, part of the record keeping system that is necessary for planning both marketing strategies as well as budgets.
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