Did you know there are 4 parts, or pieces, that every successful digital marketing campaign must have?
If you’re missing or deficient in any of these 4 areas, then your marketing will fail. It’s really that simple.
That leads us to the first key concept here…
Digital Marketing Is A Lot Like Assembling A Puzzle
That’s right, digital marketing is just one big puzzle waiting to be assembled one piece at a time. But there’s one big difference. With marketing, you don’t have the finished picture on the box to show you where and how the different pieces will eventually fit together! That certainly makes marketing a lot harder, doesn’t it?
That’s why in this article I’m going to give you that finished picture. I’ll walk through the proven digital marketing framework so you can see how all of the marketing options available fit together to create a successful marketing plan.
First, The Foundation
Before we dive into the framework, I need to highlight how digital marketing actually works. If you break it all down to the individual pieces, then digital marketing follows a very basic formula:
(Revenue) = (Website Traffic) x (Conversion Rate) x (Customer Value)
In other words, revenue from digital marketing is directly proportional to how many people visit your website, how many of those people convert into customers, and how much those customers are worth to your business.
Or to put it another way, there are 3 ways to increase your revenue from digital marketing: increase your traffic, increase your conversion rate, and/or increase your customer value.
Also, before we move on it’s important to remember that your revenue will be zero if any one of those 3 variables is zero. That’s just basic math. It doesn’t matter if you drive millions of visitors to your website if your conversion rate is zero. You’ll still end up with zero revenue!
Now that you understand this formula, it’s time to introduce the framework, which I call the 4 Pillars of Digital Marketing Success. These are the 4 Pillars every business must continually try to improve to compete online.
Pillars of Digital Marketing Success
1. Website Traffic
The first Pillar is website traffic. Obviously, if you don’t get any traffic to your website, then you’re not going to be very successful with digital marketing. If you’re just getting started, then this is where you need to focus.
Think of website traffic like fuel.
You need a constant supply of “fuel” or else your marketing will come to a screeching halt.
2. Website Conversions
As I mentioned above, all the traffic in the world does nothing for your business unless you can actually convert it into leads and sales. For established businesses that already have a steady stream of visitors, improving website conversion is likely the biggest leverage point to increase sales.
Here’s a quick example to highlight this point…
Let’s say your website gets about 1,000 visits per month and of those visitors 5 of them convert into sales. That’s a 0.5% conversion rate. What happens if you can increase your conversion rate to 1%?
You’ll double your sales with the same traffic you’re already getting to your site! That means you would double your sales with no more investment in traffic tactics like advertising, SEO, social media, etc.
3. Customer Value
Customer value is often the X-factor in digital marketing, yet many businesses ignore it. Again, I’ll use an example so you can see how your customer value plays a role in your marketing.
Let’s say your conversion rate is 0.5% and your average customer value is $100. That means, on average one visitor to your website is worth $0.50.
That also means you can not afford to pay more than $0.50 to drive a visitor to your website. If you pay more than 50 cents, then you’ll lose money.
What happens if one of your competitors has the same conversion rate, but a slightly higher customer value of $150? Well, this competitor can afford to pay $0.75 and will inevitably be able to buy more traffic than you. Even though the competitor may have the same offer, a similar website, and the same conversion rate, they’ll dominate the market due to their higher customer value.
Options for increasing your customer value include raising your prices, offering recurring/monthly offerings rather than just one-time purchases, and offering additional complementary products/services after the sale (upsells and cross-sells).
The final Pillar is tracking. Without proper tracking in place, then you’ll be flying blind with very little hope to improve the other 3 Pillars.
Think of tracking like the dashboard of your car. Could you imagine driving if you didn’t have a speedometer or a fuel gauge? That would be pretty stressful because you wouldn’t know if you needed to slow down or speed up. Plus, you would likely run out of fuel with no warning signs.
Proper tacking will guide your marketing decisions by telling you exactly where you need to focus.