Yes Virginia, Marketing Budgets Are Dead.
This is something affiliate marketers have known forever but is finally starting to get attention at the major marketing firms and fortune 500 companies. Having a fixed Marketing Budget is just plain short sighted. Period.
I love the example Jonathan Shapiro gives in his “Death of the marketing budget” article on iMediaConnection.com. He asks:
“What if I offered to sell you $10 bills for $5 dollars each — how many would you want? What would your budget for $10 bills be?”
The answer is simple … As much as I could get. No budget, just pure open ended profit generation. Why would I want to put a cap on that?
Gauge your marketing spend, not on a set budget, but on how well the marketing performs. If the effort is making money then throw more money at it, if its not cancel it or use the detailed measurements now available to fix it. Mr. Shapiro also notes that the amount of detailed data about how marketing is performing has increase dramatically and this data can be used to craft a well oiled machine of marketing focused on getting results not meeting a budget.
It’s simple really, Instead of building a marketing plan around budgets, build it around performance and as long as it is performing…
Damn the Budget and Full Steam Ahead!
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I completely agree with John and Jonathan. There is a reason that affiliate marketing is considered performance marketing – you pay ONLY for performance. Optimize the proper channels and there should never be a lead or budget restraint.
I also like the analogy of buying $10 bills for $5. With Affiliate Summit West in Las Vegas coming up in 2 weeks, I’ll take those odds of winning to the bank every time!