Small Businesses Are Overspending On Marketing. Here's Why!

Small Businesses Are Overspending On Marketing. Here's Why!

Running your own small business is a dream come true for many. But 2020 has turned many ambitious entrepreneurs’ dreams into inescapable nightmares. In the current climate, small businesses face a battle for survival. Most have had to make huge, sweeping operational changes at great expense to them and disruption to their employees.

Many have effectively had to place their operations on hold, relying on government support to keep themselves from closure. The UK’s “Eat Out To Help Out” scheme, for instance, proved a useful shot in the arm for cafes and restaurants, coaxing thrifty diners to dine out with generous 50% discounts supplemented by the government. Now that the gears of commerce are slowly grinding back into action, small businesses from bars and restaurants to boutique stores face the difficult task of re-engaging their existing customers while trying to attract the new custom that will lead to sustainable growth. 

Of course, most entrepreneurs know that the best way to do this is through robust marketing efforts. But at a time when most small businesses need to be very aware of overhead expenditure, the ROI of their marketing costs is of paramount importance. While marketing ROIs are generally quite high compared to most other overheads (usually around 300%-500%), that doesn’t mean that every dollar spent on marketing is 5 more dollars waiting to happen. In the mistaken belief that any marketing spend will pay off eventually, small business owners can fall into bad habits that lead to overspending. While it’s estimated 47% of businesses spend less than $10,000 on digital marketing per year, where that money goes can make all the difference.

Let’s take a look at some bad habits that are decimating small business’ marketing ROI...

They’re letting paid ads do all the heavy lifting

When it comes to engaging your business’ target audience, it’s a truth universally acknowledged that organic engagement is best. When prospective customers come to your online presence of their own volition, they’re statistically more likely to form a relationship with your brand. However, experience has taught most small business owners that orgasnic engagement doesn’t come overnight. It takes time, effort and patience. Commodities that few SMBs can spare in the current climate. 

Paid / Pay Per Click (PPC) ads on social platforms and search engines may seem like the perfect shortcut. There was a time when businesses had to adopt a “spray and pray” approach to marketing— making their message as omnipresent as possible in the hopes that someone, somewhere in the right demographic would see or hear it. PPC ads eliminate a lot of the guesswork that comes with traditional marketing methods. It enables businesses to overcome the limitations of traditional marketing methods by targeting people who are in the right age range, geographic range and have the kinds of interests and income bracket that make them a viable prospective customer.

Make no mistake, PPC ads can be great for precipitating a surge of brand awareness, bringing new people to the top of business’ sales funnels. But inevitably, when the spending stops, that surge of interest and attention fizzles out. If businesses don’t use the right PPC reporting tools to gain valuable insights into who’s accessing their marketing copy and what kind of engagement they’re getting for their spend, they run the risk of losing the momentum that PPC ads can generate. As a result, they can find themselves hitting the panic button and spending more on PPC ads. But unless they learn their lessons, they can never hope to achieve an optimal ROI for their advertising spend. 

Following up PPC ads with more organic means of lead generation can prove an effective one-two punch with the power to combine targeted reach with genuine engagement.

Which brings us to...

They don’t understand the value of content marketing

When a business lures new prospects to its online presence the question it should be asking itself is… “Now what?”.

How does it convert that mildly curious passer-by into a motivated and qualified lead that will sail through their funnel? In virtually all cases, the answer is content. Content marketing is not only a powerful tool in helping new prospects engaged with your business, it can (and should) also be used to keep them engaged.  

Content marketing comes in many forms. It might come in the form of a lead magnet that encourages customers to surrender their email address in exchange for a piece of high quality content like an ebook or white paper. Likewise things like blog posts, vlogs, tutorials, “how-to” guides and infographics can also be useful ways of keeping prospects and customers engaged. 

As long as the content is of value to the prospect or customer, it can showcase the business’, expertise, build trust in the brand and ensure that the relationship with the brand is ongoing. Content marketing is can inexpensive and highly effective way to supplement your PPC spend.  

Image by Kaboompics via Pexels

They’re failing to tailor their SEO strategy to their target market

In the digital age, one can’t have a conversation about marketing without discussing Search Engine Optimization or SEO. At a time when businesses are scrambling over one another to engage the same prospective customers, positioning on a Search Engine Results Page can mean the difference between acquiring a new customer or losing one to a competitor. 

However, SEO is not a one-size-fits all game. Local SEO (the kind that matters to foot traffic dependent businesses like restaurants, cafes, bars and boutique stores) is a different beast to national SEO, which in turn requires a different approach to international SEO. 

The good news for small businesses with a local focus is that local SEO tactics are relatively inexpensive. And given that 46% of Google searches have local intent, a few subtle tweaks to SEO strategy can really pay off.  

It’s all about leveraging the “micro moments” that influence the behavior of local smartphone users looking for a business in your area and positioning yourself as the solution to their problems. Some effective ways to do this include;

  • Ensuring that your Name Address and Phone Number details are up to date and consistent across local listings.
  • Incentivize happy customers to leave reviews on your Google My Business Page.
  • Reach out to trusted local sources like your chamber of commerce, local newspapers and non-competing local businesses for backlinks.
  • Reach out to local bloggers and influencers for the same.
  • Create regular content based on local issues that are likely to generate search traffic in your area. 
  • Do research on popular local keyword searches and tailor your content accordingly (where appropriate and sensible, of course). 
  • Optimize for voice search to future proof your SEO. Click Here for some advice on how to do this. 

They don’t copy test their marketing materials

Finally, marketing is equal parts art and science. One of the reasons why many small businesses owners like to play an active role in their own marketing efforts is because of the creative opportunity that it affords them. 

And while marketing materials certainly should give prospective customers a flavor for the voice and personality of the brand, that doesn’t mean that creative whimsy should be the only thing that influences the content of marketing copy. Copy testing is absolutely essential to ensure that the tenor of the copy resonates with the target audience. Consumer responses and feedback should be considered when shaping the final iteration of any marketing copy. Otherwise it risks a lukewarm reaction among the business’ target audience or, worse still, demonstrate the kind of tone deafness that will make these campaigns live in infamy for years to come. 



Author: The FINANCIAL