As your business and profits grow, you may wonder how to reinvest in your business. As a business owner, it’s a smart decision, as reinvesting profits into your business can help you multiply your profit, keep you out of debt, and ensure you retain ownership or more control of your business (something you may lose if you look to external sources for financing).
Investing in digital marketing is one of the best ways to reinvest profits. DataReportal’s Statshot Report found that 5 billion people use the internet, meaning 63% of the world’s population is online. And you can reach that vast pool of people with digital marketing campaigns.
Why Digital Marketing Is an Effective Form of Business Reinvestment
Many business owners reinvest their profits into improving infrastructure, acquiring new equipment, streamlining processes, enhancing employee training, and improving the customer experience. These strategies are immensely valuable, as they have the potential to boost long-term profits and facilitate the expansion of business operations.
But digital marketing keeps you in the minds of your potential customers so that you are the go-to person when they are ready to buy. Marketing brings in revenue both in the short and long term, so it directly impacts your business’s growth, unlike other forms of reinvestment.
Advantages of Digital Marketing Over Other Forms of Reinvestment
Reinvesting business profits in digital marketing has the following benefits.
1. Cost-Effectiveness and Scalability
Digital marketing offers a more cost-effective alternative to traditional marketing methods. Because of the internet’s extensive reach, businesses can effectively target their desired audience with a minimal budget. Email marketing, content marketing, social media marketing, and search engine optimization are proven economical ways of acquiring a large customer base with a limited budget.
Digital marketing’s cost-effectiveness allows small businesses to compete with larger companies once they have a working strategy. When you get results from your digital marketing efforts, you can simply increase your budget to get even bigger results.
2. Targeted Reach and Measurable Results
The success or returns on traditional marketing means are difficult to measure. But highly strategic digital marketing campaigns can generate results you can measure in real-time using tools like Google Analytics or Google Search Console. The key performance indicators (KPIs) to measure depend on the type of campaign. For example, you will track the following metrics in an email marketing campaign:
- Open rate: This metric measures the percentage of email recipients who interact with an email by opening it.
- Click-through rate: This tracks the number of email recipients who clicked on links in the email.
- List growth (subscriber count): List growth measures how many new subscribers your campaign generated.
- Unsubscribe rate: This monitors how often people are unsubscribing from your list.
- Conversion rate: This measures the percentage of email subscribers who clicked through an email and performed the desired action, such as filling out a form, making a purchase, or registering for a webinar.
3. Increased Brand Visibility and Customer Engagement
Traditional marketing is restricted by geography, making an international marketing campaign difficult and expensive. But the internet has enabled any business to reach a global audience and potential customers where they are. Everyone is on the internet these days.
With the right content, brands can increase their Know, Like, and Trust factor, which leads to more leads and sales in the long run. The concept of KLT in digital marketing suggests that people are more likely to buy from brands they know, like, or trust. Brands that cultivate their KLT will build a loyal customer base, generate more leads, and increase sales.
Getting Started With Digital Marketing Reinvestment for Business Expansion
Once you understand the potential of digital marketing and what it means for your business, it’s time to get started.
Assess Your Current Digital Marketing Strategy and Goals
Analyze your online presence and performance metrics. How much visibility do you currently have, and what are you looking for? Evaluate and audit all the marketing platforms you are using against your business’s long-term goals. This will help you identify areas for improvement and growth.
A digital marketing agency can help you create a growth strategy based on your goals and marketing budget.
Define Your Target Audience and Set Marketing Objectives
Every successful marketing campaign begins with thoroughly understanding your ideal customer profile. Who are you marketing to? Who do you intend to serve? What are their pain points? What solutions do you provide to solve their problems?
Then you need crystal-clear objectives. The best approach to setting goals is to make sure they’re specific, measurable, attainable, relevant, and time-bound (SMART). For instance, don’t just say our goal is to “double our revenue.” As fantastic as it sounds, it doesn’t state how you will achieve future growth. A smart goal would look like this: “Through two online campaigns, our goal is to double our existing revenue in eight months through inbound marketing activities.”
Ensure your team and everyone working on your online campaign understands these goals.
Choose the Right Digital Marketing Channels and Tactics
There is no one-size-fits-all when it comes to the right business-generating marketing channel. However, you should consider these six main factors:
- Your audience
- Platform demographics
- Business goals
- Type of content
- Competitor analysis
There are several marketing channels that you can explore:
- Search Engine Optimization: SEO is a set of processes aimed at enhancing your website’s visibility in search engines like Google. The objective is to gain more organic traffic through relevant, high-quality content that meets users’ search intent or needs. BrightEdge research shows that 68% of online experiences begin with a search engine. Every day, people searching for a product or information carry out billions of searches on Google. More website visits equal more clicks, significantly increasing the chance of a purchase.
- Social Media: Getting your brand and business in front of new people should be a part of your goal. And social media is the way to achieve it for free. The major platforms are Facebook, Instagram, TikTok, Twitter, and LinkedIn. Each platform has its own distinct audience demographics and content style.
- Content Marketing: This is an organic form of marketing that drives results in the long term. Although it’s not a quick method of revenue generation, it is one of the best ways to build trust and credibility with your audience. Your goal in content marketing should be to create valuable content informed by your audience’s needs.
Create a Budget and Allocate Resources
Now it’s time to create a marketing budget. How much of your hard-earned profits should you allocate to this magnificent moneymaker?
There is no rule on how much of your profit you should reinvest as business expenses. However, determining the financial investment required for different digital marketing activities is a good place to start. Estimate the cost of each channel, tools, time, and personnel. Your marketing goal should guide the amount of money you need to reinvest, and the marketing aspects you want to improve will determine how you allocate your resources.
Implement and Track Your Digital Marketing Campaigns
Now that you know your goals and how you want to achieve them, it’s time to implement your strategies across your chosen channels. Whatever tools and data you use, know upfront what your KPIs are and compare them so you can monitor business improvements.
Tips for Sustaining Digital Marketing Reinvestment
Here are some ways you can sustain the profitability of your digital marketing:
- Continuous learning and adaptation should be implemented for both employees and the executive teams. Research by MIT Sloan Management Review shows that large enterprises with digitally savvy executive teams outperform comparable companies without them by more than 48% based on revenue growth and valuation.
- Marketing is a science. So, experiment with different marketing techniques and tools until you find what works. You can also measure your marketing goals. Recent marketing software has incorporated analytics, which means you can easily track the success of your campaigns with only a few clicks.
- Adapt and evolve to stay relevant in today’s fast-paced technological landscape. Keep pace with industry trends and consumer behavior to stay ahead of your competitors.
Work With Elevato for Top-Notch Digital Marketing
Reinvesting profit in a business nurtures value and sustainable growth. While there are various avenues for reinvestment, digital marketing stands out as a powerful and effective strategy. It is a smart choice for businesses of all sizes because of its cost-effectiveness, scalability, targeted reach, and measurable results.
Are you ready to reinvest in your business with digital marketing but don’t know how to start? Elevato’s digital marketing experts work with medium and large businesses that are ready to run digital marketing campaigns to increase revenue and meet business goals. Contact us today to discover how we can help you craft a winning digital marketing plan that drives growth and maximizes ROI.