Expected (ROI) Return on every Marketing Dollar Spent

Yesterday some one asked what would be the expected return on every dollar I spend on marketing. It made me think. I know that when one looks at sales you are looking at about a conversion ratio of about 15 percent. That is quite different when you are talking about sales leads. A lot of marketing is more indefinable and more about feel than any metrics one can apply to it. Still one has to make a decision. According to Derek Lowe at Courant he talks about 24 percent of medical cost is spent on Marketing. Which seems to be quite high considering that I can only tell you the name of about 4 or 5 pharmaceutical companies. Obviously this industry is doing highly expensive targeted marketing. There are some exceptions most notable Viagra.

So what should you be looking to spend on Marketing? 25 percent of your future income should it be enough?

The next question is how do you spend it?

Do you spend it on printed media, internet media, video media, corporate entertainment, or the new kid on the block social media.

What do you think?

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