Ever wondered what it would be like to be Coca-Cola with unlimited resources for marketing?
Did you realize that it’s possible for any business?
Hi, I’m Doug Barra. And in this episode of BusinessSUCCESS, you will discover the secret behind creating an unlimited marketing budget. First, however, please take a moment and like this video. I am committed that all business owners get the opportunity to take advantage of the teachings that I am regularly doing. And one of the ways that can happen is if you help. By clicking like, you are telling the “algorithm gods” that this video is relevant and vital and to show it to more people. Thanks.
You probably think that having an unlimited marketing budget is an unrealistic dream. You do not have all the money in the world to put into your marketing efforts. You have to pay salaries, research new products, and handle all the other aspects of business with a limited budget. The reality is that you can have an endless ongoing budget for marketing as long as you know your essential numbers. So what are your essential numbers?
There are two numbers you need to know and to recalculate often. The two numbers are your customer acquisition cost and your customer lifetime value. Let’s look at these a bit closer. The customer acquisition cost is what you buy a customer for. This is the average of all costs that you accumulate in pursuit of a single customer. It includes all research, sales, and marketing costs. This cost is what you pay upfront before you sell the first product to that customer.
The customer lifetime value shows what the average customer brings you in profit over their lifetime as a customer. This profit is not necessarily what you will see in the first sale. Instead, it is what you get over the following days, weeks, months, and years of interaction with this customer, including referrals they make to you. How do those two numbers give you that dream budget?
As long as the lifetime value of your customer is more than the cost of acquisition, you reinvest the acquisition costs out of the lifetime value of every customer so that you can buy your next customer. That is the key to this business growth strategy. You might be saying, huh? Say that again. Okay. If you know the exact cost of your customers on average and how much they will bring you in profit over their lifetime, and you know that the lifetime profit is more than the cost of the customer, you reinvest the cost of each customer from the profit of the last.
Let’s say that your customer acquisition cost is a thousand dollars. And you know that you have $5,000 profit coming in from that new customer in the next few years. As soon as you get that new customer, you invest a thousand dollars towards acquiring your next new customer. Rinse and repeat! Want to grow, invest 2000 or 3000. Voila! You have an unlimited marketing budget. Now don’t rush out and start investing right away to make this business growth strategy work, you need to intimately know your essential numbers, the acquisition cost, and the lifetime value.
You need to make sure they are highly accurate and constantly recalculate them to detect any changes quickly. Reducing your customer acquisition costs and improving your customer lifetime value is also crucial for making this work. Do you see this working in your business?
Leave me a comment and let me know. Now, would you like to experience the freedom of business ownership? What if you could have your business create more wealth for you without having to devote more of your time? This is what’s available when you build a solid foundation for your business. I have created this resource to show you the roadmap to that kind of business success.
I call it the Insider’s Guide To Success In Business, and you can download your FREE copy by clicking the link below this video or by visiting insidersguidetosuccessinbusiness.com. Remember, please like this video and subscribe to our YouTube channel. And be sure to click the bell for all notifications, so you don’t miss a single episode.
Once again, I’m Doug Barra. And now it’s your turn. Click the link, download your FREE guide, take your business to the next level, and I’ll see you in our next video.