Turn $1 into $2+

image

Advertising is an investment. As a startup with limited resources, you need to get a quick return on your advertising investment. That is, you better get customers from your advertising spend, or you’ll run your company into the ground before you can say the letters “I-P-O.” You don’t have the resources to waste money on advertising that isn’t working.

While it isn’t always black and white, an easy metric to help you determine whether your advertising is working is whether you are able to turn $1 into $2. Does every $1 you spend come back to the company as $2 in sales? If not, move on to the next advertising channel and keep experimenting. Repetition is the key, of course, so don’t bail immediately if you don’t see results. However, you should be able to ascertain relatively quickly whether a channel is working. If not, don’t linger for too long. There are hundreds of ways to reach customers these days, so try another channel.

Also, don’t settle for turning $1 into $1. As tempting as any revenue may be, $1 isn’t enough to build your business. You need profitable revenue to fuel growth.

icon

Previous | Chapter Contents | Next

Get The Agile Startup: Quick and Dirty Lessons Every Entrepreneur Should Know now with O’Reilly online learning.

O’Reilly members experience live online training, plus books, videos, and digital content from 200+ publishers.