Making money is a formula by Alaric Ong.mp4
Mindset of Advertising
- Making money is a formula
- Attention > Leads > Appointments > Sales
- The difference between an average marketer and a great marketer is 10%
- Let’s say an average marketer converts leads at 10% while a great marketer converts leads at 20%. That means he is TWICE as effective and makes twice as much money.
- THE APOLLO METHOD: BUYING CUSTOMERS
- I propose this concept, called BUYING CUSTOMERS. Imagine if Facebook was NTUC and Google was Giant. All you have to do is to “shop” for clients to put into your basket. Clients that you would want to service for the rest of your life. You can choose the client’s demographics, what they like, what they do, etc. Imagine you buy a customer for $200, and that customer buys products and services from you worth $2000 over the course of your long term relationship with him/her. That would be a good investment, wouldn’t it?
What if for every $1 you spend, you can get $10 back?
What if you took that $10 and reinvested it to get to $100?
How many cycles does it take to make you a multi millionaire?
When you use money to invest in marketing to MAKE YOU MORE MONEY, sales becomes easy and effortless.
It’s like each customer is a stock/bond that you invest in. This customer then gives you a payout over the next 10 months or even 5 years. If you buy this “asset” for $100 which pays you $5000 over the course of 5 years, that would be a pretty good investment, wouldn’t it? -
Lifetime Value of Customer [LTV]= (Average money they spend each visit) X (Frequency of visits) X (How long they stay as a customer)
To understand the value of marketing, the most important concept to understand is the lifetime value of a customer. The formula above is basically a calculation of how much each customer is worth to your business.
Example: Let’s say you own a massage therapy business and charge people $50 per visit. Assuming on average, each customer comes for a massage once every week. And assuming they normally stay as a customer for 3 years. That would mean that the lifetime value of each customer is $50 X 52 weeks X 3 years = $7800.
Let’s say you acquire 100 leads at $5000. If you close 10% of the leads to become customers, that would mean it costs $500 to acquire each customer. This means that you are buying each customer at $500 to pay you $7,800 over the next 3 years, an investment that gives you a 15X return. Your investment of $5000 today would make $78,000 in 3 years time.
Would you invest in marketing?