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In episode #568, Eric and Neil talk about the difficulty of inbound marketing. Tune in to hear why inbound marketing isn’t an exact science and how you can use it to your advantage.
TIME-STAMPED SHOW NOTES:
- [00:27] Today’s Topic: How You Are Doing Inbound Marketing All Wrong
- [00:34] Eric recently lost a deal to a content marketing agency.
- [00:47] The other agency was promoting processes and the execution plan was to create 500-600 word blog posts once per month.
- [01:04] Eric believes this was a weak approach, as 500-600 words is brief and you must provide quality overall.
- [01:44] Inbound marketing is not an exact science.
- [02:00] Generally, the formula for this unpredictable aspect of marketing is: you put in X and get back ?
- [02:33] In the long run you can make it more predictable.
- [03:00] Content marketing is building a lot of goodwill over time and you’re not trying to see an ROI immediately.
- [03:35] Being omnipresent, running ads, building out a funnel is all part of inbound marketing. If you’re able to build a machine like that, then you can stack paid ads on top.
- [03:48] ClickFunnels is doing something like $5-6 million a month because of his tight inbound marketing strategy.
- [04:25] When thinking about inbound marketing, you have to look at it as, are you willing to make an investment to potentially build up goodwill for a brand?
- [04:33] Eric spends $25,000/month on inbound marketing.
- [04:40] Some of that money includes salaries for content marketers.
- [05:10] For each closed deal, it costs Eric’s company $15,000 and they bring in at least $30,000.
- [05:58] Single Grain was getting 3,000-4,000 visits per month and all the leads were coming from Neil. It took two years to get that site rolling.
- [07:00] If you create junky content, you’re not going to get ROI, you’ll only lose money.
- [07:58] Think of inbound marketing as karma points and don’t focus too hard on ROI.
- [08:08] That’s all for today!
- [08:10] Go to Singlegrain.com/Giveway for a special marketing tool giveaway!
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The post How You Are Doing Inbound Marketing All Wrong | Ep. #568 appeared first on Marketing School Podcast.
Full Transcript of The Episode
Eric Siu: Welcome to another episode of Marketing School. I'm Eric Siu.
Neil Patel: And I'm Neil Patel.
Eric Siu: And today, we're going to talk about how you are doing inbound marketing all wrong. So, I'll kick this office. Recently, we just lost a deal where we pitched paid advertising, and we lost the deal to a content marketing agency. And what I suggested to the guy, and I saw the work that the other content marketing agency was basically promoting. It was basically just a bunch of processes, like a bunch of documents like high-level stuff, right, like personas, all that.
And then, the execution plan was 500- to 600-word blogs posts. You get one per month, right. So that's not how content marketing works in my mind. Content marketing is you've got to be consistent. You've got to have quality, first of all, so 500-word posts are not quality. And you've got to be consistent first and foremost. Whether it's a blog post or anything else, you've got to make sure ... To get an audience, you've got to be able to deliver something that's remarkable.
Neil Patel: It's funny. Someone recently hit me up, and they were asking me about building a inbound marketing team for their organization, and they got it right, but they went through a lot of revisions of this throughout the years, and they lost millions and millions of dollars.
And they started doing things like, "Okay, we want to create a inbound marketing team. What's the cost? How many leads is it going to generate per month? How fast is it going scale?" And they wanted to map out the numbers per month and per quarter at the least, right, but ideally per month.
The problem you end up running with inbound marketing is it's not a exact science in which you cay say, "Hey, I'm going to start inbound marketing. I'm going to throw a lot of money at it, and I'm going to get these results. By putting in x, I get y." Inbound marketing doesn't work that way. Inbound marketing works with you put in x, you get back question mark. You don't know the results.
Once you're up and running, and you've been running for over a year, you can start putting some predictability around inbound. Now if you're talking about inbound that's just paid advertising, yes, you can end up with a formula of you put in x, and you come out with y.
But a majority of inbound marketing isn't just paid ads. It's social media marketing. It's content marketing. It's SEO. It's email marketing. There's all these other channels. You start combining them all. It's too hard to come up with a ROI right away, but in the long run, you can make it much more predictable. The route you have to take with inbound marketing, think of it as quote/unquote "like branding."
What are you willing to spend to get your name out there, to let people know about you? So then that way, they know you guys are a leading product, a service, industry expert. And you have to come up with a number and be willing to spend that for a year and then worry about the ROI later on.
Eric Siu: Yeah, so when you look at financial documents, when you talk about things like goodwill, right? When I think about content marketing, you're building a lot of goodwill over time, and you're not trying to see an ROI immediately. I think a lot of people, they see it in such kind of quantitative paid ads, kind of you put x in, you get y back, month one, month two, month three kind of thing, and they quickly cut it, right?
But with content marketing, this is a long-term investment. Neil's been doing the marketing for a really long time, before the word content marketing was even invented. So you've got to think about it that way. It's a mindset thing, right? So when you think long-term, when you think about generating quality content for people, you need to think about the things we talked about. Being omnipresent, eventually running ads, building out a funnel.
That is all inbound marketing, and if you're able to build a machine like that, then you can stack paid advertising on top, and then, you're going to be able to grow your business even faster. In fact, you look at a business like ClickFunnels from Russell Brunson. What is it doing? With 60 million a year right now?
Neil Patel: Something like that. Let's say five, six million a month, somewhere around there. He'll eventually hit 100 million a year.
Eric Siu: Powerful, powerful inbound marketing. He's got his funnels. He's got his ads going. He speaks. He's got his own conferences.
Neil Patel: Podcasts.
Eric Siu: Podcasts.
Neil Patel: He's popular. He has a lot of stuff, and you combine that all, and he's done well.
Eric Siu: He even did a event at some stadium or something with like, I don't know what it was.
Neil Patel: Tony Robbins was there?
Eric Siu: Yeah some bubble stuff, where you're in a bubble, and you're running around, or I don't know what it was.
Neil Patel: Yeah.
Eric Siu: So anyway, kicking it back to you, Neil.
Neil Patel: Yeah, so when you're thinking about inbound marketing, you have to look at it as just are you willing to make an investment to potentially build up goodwill in a brand. So Eric, what do you spend right now on inbound per month?
Eric Siu: $25 grand.
Neil Patel: And how do you break down the $25 grand in spend?
Eric Siu: So there are salaries for contenting marketing people. So our head of content, our editors, our writers, video content as well and promotion. I think those are some of the line items in there.
Neil Patel: Okay, do you do any paid ads as well included in the promotions?
Eric Siu: We do. So yeah.
Neil Patel: And that's his breakdown. So he's spending $25 grand a month. What's the ROI per month? Do you know the exact number?
Eric Siu: We break it down by a free consultation. So for us, as a service business, when we ... for actually closed deals. So for each closed dealt that we get, it ends up costing us about $10, $15 grand or so, and we know our contracts, at minimum, they stay for ... It's a $30 grand kind of thing, and it goes higher.
Neil Patel: Wait, $30 grand, and you're paying $15 grand?
Eric Siu: Mm-hmm (affirmative).
Neil Patel: That's a bad deal.
Eric Siu: $30 grand, $15 ... But it's at least $30 grand, and in many cases ... Let's say the lifetime value, and I'm giving you guys my lifetime value of a paid advertising client, is closer to $100,000.
Neil Patel: Oh, yeah, yeah, yeah. That's a good deal.
Eric Siu: Yeah.
Neil Patel: I thought you were saying you'd only get $30 grand for spending $15. I'm like, "That sucks." Then you've got to pay employees and everything. But you got it. And he's not looking at it each month that like, "Oh, this is all I'm spending on inbound," and you've generated a ROI right away. When you first started out on the Single Grain blog, you weren't generating any return. How long did it take you guys before the numbers started working out?
Eric Siu: Yeah, we can go into that story too. When I first joined Single Grain, the blog was getting about 3,000 to 4,000 ... Or the site was getting 3,000 to 4,000 visits per month, and the leads were coming from ...
Neil Patel: Oh yeah, they were coming from me.
Eric Siu: Yeah. All the leads were coming from Neil. We were not generating any leads at all. It took us, I want to say to get the machine really rolling, about two years to do it. Same thing with my first podcast. It took about two years to really get it rolling.
Neil Patel: Yeah, it all takes time. Even this podcast, it's been a bit more than a year now. A year and a half.
Eric Siu: A year and a half. Yeah.
Neil Patel: And it's starting to roll, and we were flat for a while, and then we started figuring out how to grow it. But ROI-wise, I think we just lose money. I don't even know what the ROI is, but we don't care, right? It goes to brand building, and our belief with inbound is you keep doing this. Whether it's videos, content, podcasts, and in the long run, it all adds up, and it'll work out.
But think of it as just goodwill. It's just like help a ton of people, and whatever happens on the backend happens. It's karma, and usually, it'll work out in your favor, assuming you're doing amazing stuff with inbound. If you create junk content, junk quality audio, junk video, you're not going to get ROI. You're just going to spend money. The quality has to be amazing for inbound to work.
Eric Siu: I would say we're probably ROI-positive on this, and I'll share a couple of stories, and this has probably happened to you, but maybe you're just not noticing it. But for a client that we recently just closed actually yesterday, this was a ... At the minimum, this deal is worth at least $300 grand for our end. And I'm pretty sure these people are going to listen to this episode. The guy reached out. New VP of operations at a company, and his daughter ... He said his daughter listens to all the episodes. She's 16 years old, okay?
Neil Patel: That's awesome.
Eric Siu: And then, he got his marketing director to listen to them too, so that's for sure ROI, and we have Crazy Egg stuff going on too. I think it's ROI positive.
Neil Patel: That's true, and I don't track it, and I don't really look for the revenue, and Eric doesn't either.
Eric Siu: Right. Yep.
Neil Patel: But, in general, neither of us are trying to generate customers. If that happens, it happens. If it doesn't, it doesn't.
Eric Siu: Yep.
Neil Patel: But that's the way we look at inbound marketing. You do a lot of it. Think of it as karma points. Assuming your quality is really high and you genuinely want to help and you're producing amazing stuff, eventually, it works out. But it takes a year to two years to see ROI from it.
Eric Siu: Yep.
Neil Patel: Totally.
Eric Siu: So with that being said, go to singlegrain.com/giveaway for our marketing goodies and we will see you tomorrow.
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