7 Steps to Help Justify an Inbound Marketing Budget
by Erin Kerrigan on Thu, Apr 16, 2015 @ 11:00
Many of us hate that dreaded situation where you have to walk into your boss’ office and ask for money. The reality is though, if you go in armed with the supporting data to make a strong case, you’re much more likely to get the result you’re looking for. If you can prove the return on investment, the conversation changes from unpredictable, to a near surefire win.
We’ve created a ROI calculator to help you justify to your team why you should be investing budget in inbound marketing. Here are the 7 steps to getting the data you’ll need to craft that winning pitch:
Determine how much traffic your site is getting today. You need to know the relative size of your website audience in order to understand your baseline. Get a monthly average to simplify things.
Find out how many leads you’re receiving through the website today. If you have conversion points, such as forms, built into the site, you can pull some of these general numbers. If not, you’ll need to talk with your sales team to get their feedback.
While you’re in with the sales team, find out what their close ratio is. Out of 100 leads they’re handed, how many do they typically close?
Calculate how much a new customer means to the business. You’ll want to come up with the total number a new customer will spend with you in the first year. Consider what the average order size is, and then how many times they’ll order within a year to get a ballpark figure.
Make sure you know your average profit margins. What percentage of revenue is real profit for the company?
Take the number you came up with in Step 4 and pair it with how many years you typically retain a customer to understand what a customer’s average lifetime value is. You’ll have a dollar value that shows what you’ll collect from each customer over the lifetime of your relationship.
Bring it all together. Take all of the data gathered from Steps 1-6 and enter it into our ROI Calculator to find out what your return could look like. You’ll see your revenue and profit increases to show how it will offset the investment you want to make.
Need some extra ammo? Submit those results for a custom consultation and we’ll help you craft the arsenal of data you’ll need to go into your budget meeting with confidence!