As a business owner or GM of a company, you’d no doubt have come across your fair share of digital sales proposals.
Selling advertising on websites and networks is one of the most lucrative forms of business in today’s internet world.
Digital marketing is probably the most powerful medium right now. But do you know that over 90% of marketers you meet are clueless about measuring performance?
There are many ways to analyze and evaluate marketing plans.
But one surefire way to waste marketing dollars is to believe the most 3 common methods digital salespeople use to influence you into signing a deal.
“Numbers don’t lie.”
That much is true. But our interpretation of numbers can easily lead to a wrong conclusion.
Most digital salespeople will start their presentations to you with huge numbers.
“Our website is the leading portal in Southeast Asia and serves more than 7 million visitors every month.”
Well, good for them. But how does that help you?
Google reaches a few HUNDRED MILLION people in Southeast Asia. What’s a mere 7 million?
Big numbers don’t help you. In fact, if your ads reach that many people, your campaign will most likely lose you money.
What you’re looking for isn’t visitors to their website. It’s click, readers and sales for your business.
Be sharp enough to see beyond big numbers and ask how many clicks/readers you will get.
If a salesperson keeps giving you the reason as to why he is unable to provide an estimate on the above figure, then he falls into the 90% of marketers who are clueless about measurable marketing.
Exclusive Customer Segment
A client of mine recently wanted to advertise with a local magazine for the rich (whose name I shall keep private). It’s a well-known magazine with a digital publication. The cost of running an article with them was $9,000.
The sales pitch was that their publication was the best and most cost-effective way to reach “rich and high net-worth individuals”.
If you ever see a sales pitch like that, remember these 2 things:
- Magazine readership numbers are usually buffed up by distribution stats. For example, a magazine can claim to reach up to 16,000 Vice-Presidents in Singapore. But the truth is, many magazines simply get the mailing addresses of high-level executives and mail them free copies. How many free magazines do you receive at your workplace every month?
- No customer segment is truly exclusive. $9,000 for an article? Sure. I’d pay that. But not for the “exclusive reach”. This is the internet. If any website or magazine thinks they’re the only one who can reach a particular target audience, they probably haven’t been in digital very long. How many websites do you read? Even a list as valuable as “high net-worth individuals” can be targeted at only $5.40 per confirmed lead. And there are multiple ways to do it.
Ask your in-house marketer or marketing partner for other ways to reach that same audience.
If your marketer is good enough, he/she will be able to reach any segment (to varying degrees of specificity, of course). Use those results to judge if the magazine is overcharging you.
Other Businesses as Benchmarks
Most business owners or even marketing managers don’t dive too deep into numbers. If you’re reading this article, you’re already ahead of the pack.
So when you start asking questions about metrics and throwing numbers out, the salesperson usually gets caught by surprise.
This is when he/she will try to justify the price they are quoting.
The most common thing to do is to compare your price to that of a previous customer.
Back in 2013, I was approached by a major digital ads network. They had a brand new automated system that could optimize bids for all campaigns. The network reached more than 30 million youths who were interested in games (my target audience at that time).
They quoted me an average Cost-Per-Click of around $20 to reach their exclusive network. After I told them the price was too high and showed them some figures, they told me that a US-based TV network paid up to $50 per click.
If someone else was paying up to $50 per click, I should be happy paying only $20.
I pulled out my laptop, hooked it up to the projector, and showed them this screen.
Their jaws dropped.
It’s not that clear from the screenshot but I was paying only $0.30 per customer, for users of the same quality. The only reason I looked for alternatives was that I was spending a lot of time managing the account and wanted to automate the process. But I sure wasn’t going to pay $20 instead of $0.30.
So in effect, the US-based TV network was paying 167 times what I was paying, for the exact same customers (if you’re curious, you can read about that here).
Anyway, the moral of this story is, just because someone else overspends, doesn’t mean you should too. If you ever need to benchmark, compare to the best performers, not the worst.
Stay sharp, so you can always pick out the best deals and improve your business. Those are the 3 most common methods salespeople use to influence you. Have you come across any others?