When you’re running your own business, the adage, “You’ve got to spend money to make money,” is a truism that, while helpful in quickly explaining why investing back in your business is essential, still doesn’t remove the sting of having to do so. Spending money to make money might be a requirement of doing business, but how you spend that money and what it gets you in return, can’t be overlooked.
Keeping an eye on your ROI and working to improve it are part and parcel of staying in the black, but not all attempts to bolster returns are equal. Here are six tricks anyone can use to improve their small business’s ROI.
1. Define Return(s)
Before you drop a dollar anywhere, it’s essential that you define what you hope that dollar will yield. What, exactly, are the returns you’re hoping to get when you make an investment in your business? Are you looking for increased sales, bigger profit margins, lower overhead costs, better employee retention, improved customer satisfaction, something else, or all of the above? By defining exactly what you want in terms of returns, you’ll be better positioned to improve the ways in which you go about trying to get achieve them.
2. Get Smarter About Advertising
Advertising, regardless of the industry of which you’re a part, is wise to invest in, but how you go about it is important, too. From traditional media to the myriad of ways you can market yourself across the Internet, there has never been more opportunity to advertise to potential customers, or — on the flipside — to pay for advertising that doesn’t result in much. Instead of throwing money at a marketing firm and hoping the results are good, be strategic — especially when it comes to advertising online. Choose CPA networks that work with affiliates who convert traffic into sales rather than just paying for click-throughs or leads. That way, your investment will always be linked to a bona fide return.
3. Cut Costs
Depending on how your business is faring in the current economic climate, it may be unwise to raise prices or expend resources you don’t have to try and increase sales. If that’s the case, you can still improve your ROI by decreasing your expenses. Whether you lower the thermostat in the winter by three degrees or have the cleaning crew you’ve contracted come by the office less often, cutting costs can have an immediate and positive effect on your ROI. Just be sure you don’t get so draconian that it negatively affects your employees’ morale.
4. Skip the ‘Vanity’ Metrics
Yes, it’s nice to have a lot of people Like your Facebook page. Yes, it feels amazing when your most recent press release gets retweeted dozens of times. However, those metrics don’t often have much impact on your bottom line. While it can be tempting to chase after these measurements of social media success, if you’re truly interested in boosting your ROI, they can be a distraction. Yes, social media is an important part of today’s business landscape, but focusing too much on getting attention there can keep your from pursuing more worthy, return-oriented goals.
5. Testing, Testing
Sometimes, the path to improving your ROI is one you’ve never been down before. Trying out ideas and testing them to see whether or not they work can be a great way to improve your ROI. First, select the group you’re hoping to impact — be they current customers, employees, or potential customers. Then, try out a specific action or idea on part of that group without doing anything in relation to the rest of the group. With the existence of a test group and a control group, you can then see whether or not your idea resulted in any positive or negative changes. By experimenting and testing, you can often arrive at surprising results that, if you’re willing to be patient, can help your ROI.
6. Build a Better Website
Even if you don’t sell online, your website is an essential feature of your brand. Spending resources on improving your website can have a major impact on your bottom line, your conversion rates, your customer satisfaction, and more. Most people learn about and research businesses — even those that they will eventually visit in person — on the World Wide Web, which means your presence there must be mighty. From responsive design and improving copy to optimizing for mobile, when you invest in a better website, an improved ROI is almost sure to follow.
Improving your small business’s ROI doesn’t have to be left to chance. Try out any of these six tricks, and you’ll be looking at a bolstered ROI in no time.
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