The elusive eCommerce budget dances around vendors.
You’ve probably seen the reports that online marketing spending is trending up.
eTailers and eCommerce companies are moving advertising and marketing dollars online. These firms are looking at where the new generations are spending their time and focusing on earning attention.
Budget Problems For eCommerce Vendors
If you’ve worked with business owners, marketing directors, and eCommerce managers you know that getting your service to fit into the budget can be tricky.
Often, it’s easy to get managers on board with a service and solution, but convincing the marketing director or business owner is more of a task.
While marketing directors are certainly up to speed on the latest trends in eCommerce they still have certain restraints when it comes to shifting budget dollars to new channels.
The process can be especially difficult for eTailers with a history in traditional advertising such as catalog, direct mail, and other offline channels.
What Matters Most To eTailers
If you’re like me you’ve worked with a few marketing and accounting directors. There is a saying in the business world that goes something like this:
I’ll approve almost any budget if you can prove the venture to be profitable.
Profit is what matters most to eCommerce business owners, directors, and managers.
With catalogs and direct mail, one knows almost exactly the response to expect and how much profit that means.
The same is true for paid search.
A major reason Google has been able to do so well with PPC is that eTailers almost always know the exact return they can expect when paying for clicks.
Figure Out Return On Your Service
It seems basic, but your service will become much easier to sell once you figure out at least an estimated return. Once companies are on board with expected returns the budget dollars start to free up. They will still approach the new venture as a test, but they will feel more comfortable knowing what is expected.
Work with your existing customers to figure out the return from your service. Create case studies you can share with potential eTailer clients.
You can also use comparable budget spending to make your case.
Some search engine consultants or SEO firms have figured out what website traffic means to eTailers in terms of dollars. They will compare the cost to acquire that traffic through paid search ads versus obtaining that traffic through natural rankings.
A quick story: if you follow professional golf you probably don’t know the name, Deane Beman. He was a professional player and later became PGA Tour Commissioner.
In a book about his legacy, Beman described the challenge in obtaining title sponsors for PGA Tour events. An excerpt from the book:
As the Tour became more sophisticated in selling corporate titles, it began measuring the value of sponsorship.
"You couldn't buy an ad on the front page of the sports section. We were getting their [corporate sponsors’] name in places they couldn't even buy," Beman said. "The corporate sponsor was getting a bargain. Once you started to evaluate the return on investment, it was an easy sale."
In 2011, a corporate sponsor pays approximately $7 million to $8 million for a FedEx Cup season event with network television, according to the Tour. The title sponsorship generates as much as $25 million in advertising value through its combined media exposure, the Tour said.
Figure out the return on your service or the comparables and you’ll gain access to marketing budgets.