Marketing 301: The Magic Slot Machine: Getting a return on your investment
The Magic Slot Machine (MSM) concept is that for every $1 you put into marketing you get $2 or more out. You have arrived at a solid marketing model when you have figured out how to build your MSM.
First, think in terms of networks or “channels.” 5 example channels:
- Existing patients/customers/members/clients
- Engaged social media participants
- E-mail list
- Partners
- Paid channels: TV, radio, newspaper, social media, and Google
Next you have to understand your Customer acquisition costs (CAC) or the amount you have to invest into any one of these channels to get a new person. For example: If you spent $100 dollars on marketing and got 100 customers that is $1 CAC.
I have a client who spends $20,000/month and averages 40 new people. That’s $500 CAC.
Most people would never do this.
However, their Case Average is $5000/case. That’s $200,000 return on a $20,000 marketing investment. That’s not just a magic slot machine (MSM), that’s a magic lottery ticket machine (MLTM).
AND THAT’S NOT THE WHOLE STORY:
There are products those people buy, they refer, and they re-sign. The money made in perpetuity beyond the initial case average is called Customer Lifetime Value or CLV.
It’s conceivable that on the average, between further purchases, referrals, and re-signing into new plans that the CLV is another $1000 or more or $6000+ on the average.
With the CLV, that lottery ticket just became an even more valuable payoff to you MSM.
While you have to be frugal in you business spending, you can’t save your way to wealth.
If you want help setting up your Magic Slot Machine, we are happy to help and can even point you to marketing vendors that can allow you to make this work.
