Tracking your expenses, and measuring ROI
With the many avenues to get your name out there now, it can seem tempting to try a little of everything to grow your client base. However, this probably isn’t a great strategy–a crucial part of measuring your business expenses, as discussed before, is measuring your return on them as directly as possible.
Some business expenses, such as licensing fees, are necessary evils you can’t do much about. But specifically, your expenses in generating leads are something to keep an eye on. Generally speaking, the more control you can have over whatever marketing you’re doing, the easier it is to measure and have a positive return. The greater the presence of a third-party middleman, the harder it is to get a good return on investment (ROI), creating a significantly higher risk of throwing money at something that doesn’t bring much, if any, back.
For example, marketing to your sphere of influence or sending out direct or electronic mail can be much easier to quantify. You may incur some additional costs such as printing and mailing, but you’ll be able to directly categorize where that lead came from and how much it costs to get, which is absolutely something you should also keep track of.
In terms of building connections at low cost, one potential shortcut is to think of places in your daily life where you’re able to naturally create a direct relationship. Perhaps you’ve struck up a few conversations with the owner of your neighborhood cafe, or have a loyal acquaintance in your pilates class. Even if these relationships are far from lifelong friends–these are often called “weak ties”–that genuine, face-to-face relationship can go a long way.
Contrast that with far less direct forms of advertising, such as paying to have your name on a grocery store shopping cart or in a chamber of commerce magazine. Enough exposure through those methods could generate some leads, but having a positive pre-existing relationship makes that person many times more likely to think of you when the need arises. Now that’s money well spent–if you spent money on that lead at all.