First, you have to look into the dynamics of your marketing goals and your budget. What you find will help you answer will help you know when to stop or keep Investing.
A)Did you create your marketing plan’s goals on strategies according to the amount of resources available to you?
B)Or did you create your budget according to your marketing plan’s goals and strategies?
When an Increase in ROI Means More Profit
To state the obvious, having more money now allows you to pursue more marketing opportunities. You can use the left over money to either widen the scope of your advertising to more people, or intensify your efforts. Money after all begets money.
1)Extending your printing can be more than 50% or 80% cheaper for the subsequent prints.
2)If the rate of returns for 1000 direct-mail-advertisement is 3% or 30 deals, then increasing it to 2,000 will generate 60 deals.
3)If you have compiled your mailing list though from your customer database, making your direct-mail-advertising more frequent increases your rate of return.
4)The more customers you have, the more chances there are of attracting more customers through referrals and word-of-mouth over the long term. An increase in sales can be indirectly attributed to your ads.
This may sound like an argument to get more prints instead of taking the savings, but at what point should the investing stop?
Law of Diminishing Returns
If you chose to adjust your budget to your goals and strategies though, you must already know the answer. At a certain point, an increase in investment will not make an increase in profit or profitability.
1)Making your advertisement more regular will familiarize your customers with your services, build recognition, give more information and will eventually lead to an increase of sales. If you send your mail too frequently, your customers’ will find it annoying, discard your print, think of you as pushy and will be counter-productive to your sales.
2)If you are advertising a consumable product for a special needs product, any increase in advertising will not increase your response. Any increase in advertising will not expand your market, and making yourself more desirable to your existing market will not make them consume your products faster.
3)If your capacity to supply is limited, any increase in demand will not give your business more profit. It will even be detrimental if more people came to your shop and you are unavailable to provide the products or service to them. Cheap printing can be tempting but advertising can be a guessing, make sure you only advertise to as much as you can handle.
