The last few years, there has been a push toward online marketing. Whole companies were created to exclusively sell their products via Facebook or Instagram. I sell a ton on these platforms as well, but there is one big difference. And I have one major word of warning for anyone selling on Facebook or Instagram: Start prepping now.
The Rising Costs Of Online Marketing
Far too many small-business owners get the vast majority of their traffic from Facebook or Instagram. This is similar to the early 2000s Adwords days. You used to be able to get penny clicks on AdWords. Some folks made a killing using AdWords ads to sell products or utilizing the service’s arbitrage feature. (Arbitrage is where you pay for a click on a website — these clicks are sent to a website full of ads that pay you.) While AdWords is still a great marketing tool for many, the days of super cheap clicks are long gone.
Facebook and Instagram have been raising their price per click, engagement, view, etc. for years now. Plus, the demographic of advertisers has changed since many can’t afford the cost. So, having all your eggs in these baskets is a huge mistake.
Even if you’re making good money marketing on these sites, they’re the only place you’re getting any traffic. It’s a problem you better start solving now. It is going to get ugly here soon.
That leads me to my warning. During the past presidential election, ABC reported that over $200 million had been spent on advertisements through Facebook, Instagram, and Google’s platforms. This massive influx in money drives up ad costs across these platforms, and some companies can’t afford their customer acquisition costs.
This only gets worse over time, but long term, it could have an interesting impact on advertisers. Why? Some companies won’t be able to survive for weeks or months without new customers.
To some extent, we will all be affected — high customer acquisition costs hurt us all. So, now would be a really good time to review your entire marketing and sales process.
Look for areas that are weak because they rely on cheap customer acquisition and fix those areas first. For example, what is your lead follow-up process? Do you need to add in more nurture campaigns or sell other products and services to unconverted leads? Do you need to get some sales training in place? How about adding a new media to your marketing that will be less affected by political ad spend?
Whatever your plan, the good news is you have time to ensure you can easily weather any storm coming your way. As an added benefit, by doing this exercise, you’ll also have a better, more profitable business once the ad spend normalizes.
If you choose to do nothing, it may be a very lean season for new customers, business growth, and profits.