Tired of guessing how best to spend your marketing dollars? Forget that! Use this approach by BringShare.com to build a marketing performance model that will allow you to scale up your marketing with predictable results!

1. Measure It or Forget It!
How to grow a business without the guesswork.
BringShare.com

2. The Evolution of Marketing
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“In the beginning, there was print.”
The marketing world has always followed consumer eye balls.
In the beginning, print was the only way to reach
consumers and marketers spent millions putting ads in
front of consumers - hoping for an overall increase in
sales. This took months if not years to measure and
required spending thousands of dollars just hoping for
results.
Then came radio followed by television. Both mediums allowed
for more exact measurement of eye balls but still
marketers had no way of knowing exactly how many
people saw the ads and what results could be directly
attributed to the ads.

3. The Internet Is Born
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“Awww… look how cute he is.”
Then all of a sudden, the world’s largest companies started adding domain names to all their TV
commercials. It wasn’t long after that all businesses began to experiment with the internet as a way
to provide information to consumers.
Today the internet has become the nervous system of most companies. It is not only a way to share
information with consumers but it’s also a way to sell more products, build relationships with
customers and provide a better customer service experience overall.
So what does this mean when it comes to the way companies market their products and reach
consumers?

4. Now There is Data
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“Impressions are for the birds.”
It means that the old way of marketing no longer applies to small and medium-sized businesses.
Marketers no longer have to spend thousands of dollars buying eye balls and then waiting until all the
money is spent to determine if it worked.
The new mantra of small and medium-sized businesses:
M e as u re i t
o r fo rg e t i t!

5. Say Your Goodbyes
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“It’s not me, it’s you.”
Say goodbye to the Yellow Pages sales
representative. Send a farewell letter to the
billboard sales girl. Start avoiding calls from that
TV account executive and stop entertaining the
local newspaper sales team. Let them cry.
It’s a new world and growing a business is no longer
guesswork! Risk should be minimized and
everything should be measured. The following
pages are the definitive guide to growing a
business… without the guesswork.

6. Step 1: Know The Numbers
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“I don’t like math unless it involves money.”
Knowing what numbers matter is the essential first step to growing a business without the guesswork.
With these metrics, it will be easy to determine how the marketing needs to perform in order to grow
a business profitably.
The essential metrics:
Average Transaction Value:
This is the dollar amount of the average transaction
a company has with a customer.
12 Month Customer Value:
Unlike lifetime value, this is the dollar value an
average customer is worth over the 12 months
following the first transaction with that customer.
This is important to know because the goal is to
scale a business up quickly and the investment
in acquiring a new customer should be returned
within 12 months so it can be reinvested.
Gross Margin:
This is the percentage of profit created after
subtracting the cost of goods sold from the
average transaction value.

7. Step 2: Apply The Numbers
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“You can handle the truth.”
Once the numbers are figured out, it is easy to understand how much can be spent to acquire a customer
and still breakeven. In the example below, the company should set a goal of spending equal to or
less than $47.50 to acquire each new customer. The company also knows that if it costs up to
$142.50 to acquire the customer, that is still okay… just not ideal.
Example metrics:
How much can I spend to acquire a customer
– Average Transaction Value: $95 and breakeven right away?
– 12 Month Customer Value: $285
Average Transaction Value
- (Avg Transaction Value * 50%)
– Gross Margin: 50%
$47.50
How much can I spend to acquire a customer
and still breakeven within 12 months?
12 Month Customer Value
– (12 Month Customer Value * 50%)
$142.50

8. Step 3: Know How The Company Site Performs
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“How YOU doin’?”
Regardless of what online marketing opportunities are used, all of them will drive traffic to the company
website. Therefore it is important to know how well the site will convert traffic to customers. This
number is called a conversion rate and is the percentage of all traffic that makes a purchase while
visiting the site.
A Typical Conversion Rate is 2%.

9. Step 4: Build a Marketing Performance Model
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“Put your money where your mouth is.”
With all of this data assembled, a marketing performance model can be created that makes evaluation of
potential marketing opportunities very simple. All that is needed is an estimated cost per visitor for
each marketing opportunity to be evaluated.
In this example, the company is spending $0.75 for each visitor and making a $.20 profit on every visitor
right away! ($20 profit per 100 visitors)
How to Calculate
A Cost Per Visitor $0.75 You enter How to Get Cost Per Visitor Data:
B Conversion Rate 2% You enter
Paid Search: use average Cost Per
C Cost Per 100 Visitors $75.00 100 * A
Conversions
Click estimate
D (Transactions) 2 100 * B
Display Ads: ask for expected click-
E Cost Per Transaction $37.50 D/C through rate (CTR). Then multiply the
Average Transaction
F Value $95 You enter
CTR by the number of impressions
G Total Sales $190.00 F*D you are buying. Then divide how
H Gross Margin 50% You enter much you are spending by that
Gross Profit (Sales - number to get your cost per visitor.
I Gross Margin) $95.00 G - (G * H)
J PROFIT $20.00 I-C

10. Don’t Forget 12-Month Value
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“Show me the money.”
Keep in mind that even if the profitability after the first transaction isn’t that great, there are 12 more
months to get money out of that customer. In this example, the company is spending $.75 for every
visitor and making a $2.10 profit per visitor over 12 months!
How to Calculate
A Cost Per Visitor $0.75 You enter
B Conversion Rate 2% You enter
C Cost Per 100 Visitors $75.00 100 * A
Conversions
D (Transactions) 2 100 * B
E Cost Per Transaction $37.50 D/C
Average 12 Month
F Value $285 You enter
G Total Sales $570.00 F*D
H Gross Margin 50% You enter
Gross Profit (Sales -
I Gross Margin) $285.00 G - (G * H)
J PROFIT $210.00 I-C

11. Step 5: Scale It Up
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“We have lift off!”
Once a marketing performance model is built and proves to be working, it can be considered
“predictable.” This means more money can be spent safely and the amount of profit it will generate is
almost a guarantee. This allows a company to grow more quickly and without risk.
In this example, the company is spending $7,500 per month and making $21,000 in profit over the
following 12 months. So every month, they make $21,000 more profit in the next year. Imagine how
that builds!
How to Calculate
A Cost Per Visitor $0.75 You enter
B Conversion Rate 2% You enter
Cost Per 10000
C Visitors $7,500.00 100 * A
Conversions
D (Transactions) 200 100 * B
E Cost Per Transaction $37.50 D/C
Average 12 Month
F Value $285 You enter
G Total Sales $57,000.00 F*D
H Gross Margin 50% You enter
Gross Profit (Sales -
I Gross Margin) $28,500.00 G - (G * H)
J PROFIT $21,000.00 I-C

12. Are you growing?
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“If you’re not moving forward, you’re moving backward.”
Growing a company can be the most challenging task anyone can be assigned. It can also be the most
exhilarating. Making investments that feel like guesses are buzz kills that cause anyone to lose sleep
at night. Luckily, the internet has changed the game and with this approach to marketing, sleeping
well is as easy as counting money.