A Powerful Marketing Formula

The coming 5 weeks will cover the 5R’s of local marketing, but I want you to see this formula first in order to relate each of the R’s to it.

This formula is a secret key for getting the greatest return from your marketing dollars.

Martketing strategies

No matter which kind of campaign you’re doing;

  1. Retention: Existing Customers Revenue
  2. Reactivation: Existing Customers Revenue
  3. Referrals: New Customers Revenue
  4. Reputation: New Customers Revenue
  5. Ranking: New Customers Revenue

If you track and measure carefully and make your decisions based upon what you learn you can drive revenue up at will. Seriously! Did you get that?

You Can Drive Revenue up at Will

Formula Breakdown

# = the number of leads generated

% = the percentage of leads converted to customers

$ = the dollar value of the average resulting sale

t = the selling cycle duration, or the amount of time it takes to close.

Think of the formula as a simple fraction, the numerators are # % $ and the denominator as t

Just like any fraction, in this formula if you increase the value of any numerator; the number of leads, the percent of conversion or the dollar value of the sale, then revenue increases.

Also just like any fraction, and this formula if you decrease the value of your denominator which is time, then you also increase the resulting revenue!

Using this formula you can dramatically affect the revenue of your business by tweaking each of the variables. You can only do this if you’re tracking and measuring all of those variables in each of your different campaigns.

At the most basic level, marketing is about money isn’t it? You invest some dollars in various forms of advertising and then you count on getting many times more revenue than the investment in the ad. Use this formula to measure and adjust any campaign and I guarantee you a dramatic increase in ROI each time you make a winning adjustment.


Next week I’ll cover “Retention”