And why blog posts are like having a bank account that earns interest.
Picking up where It’s That Time of Year left off, we were discussing how to ballpark how many blog posts you might want to plan to produce to meet your business goals. As I was walking through this it occurred to me that we could go one step further and develop some valuation models for blog publishing.
There are a couple of ways to put a value on a potential business investment. One is to estimate the NPV (net present value) of the free cash stream generated by the investment. Using our rough range guideline we established in the previous post for how many contacts you might generate with a given number of B2B blog posts, you would need to know your estimated conversion rates at each stage of your funnel, and the resulting revenue and average profit margins to work things back to an ROI based on a cost per blog to produce.
This is doable and it would be super interesting if some folks wanted to volunteer their data for a real life examination!
Another way to value a business asset is to look at potential replacement costs. Let’s assume that you’ve made the decision to grow your business by leveraging online lead generation, and now you are looking at the most cost-efficient way to get started.
A natural substitute for blog publishing is to run Adwords campaigns. Making the assumption that you would drive an equivalent quality of website traffic through either publishing content or buying adwords, you can draw some comparisons of which approach might produce the best value proposition.
One thing that you’d need to have a grasp on is what are Adwords clicks going to cost you. Wordstream estimates that clicks are averaging between $1 and $2 each which seems like a fair estimate. However, B2B companies can be in specific spaces where either what they do is pretty esoteric and the CPC (cost per click) can be less, or in some cases the terms they want to purchase can be much more. I’m evaluating one PPC (pay per click) campaign now, and the average CPC is $5.81. Whoa.
So using our ballpark range of potential traffic per post and some high and low estimates of CPC, you can estimate the replacement cost of publishing blogs vs buying clicks. Again, this is all predicated upon very small data sets, but it compares well with experience in a much larger number of HubSpot portals. If anyone has done or seen a more comprehensive and statistically reliable study please offer it up! If you want more sales leads, you need to be B2B blogging.
This is where we get to the ‘bank account that earns interest’.
When you buy Adwords, you are buying attention one click at a time. When the click event passes, conversion or not, that money is sunk. Blog posts have a long, and potentially very long shelf life. When you publish posts and they begin to draw visitors, they produce value far beyond the initial investment in resources. You can see the potential range of values of a post over 5 years in the column to the right. Knowing what it costs to produce a blog post, and having had experience as a VP across every demand generation tactic there is, there is no question that B2B blog publishing is the lowest CPL (cost per lead) option available to B2B marketers today.
This is why you’ll often hear me say, ‘if we’d had these capabilities when I was a VP Sales / Marketing I’d have been giddy’.
This is also why HubSpot has been wildly successful to date with SMBs. Because it provides the tools to be able to be successful with available internal resources and the best ROI of any online marketing option today.
As the platform becomes more robust and sophisticated, HubSpot is moving upmarket and encroaching on the turf of the Marketing Automation platforms that are considered to be ‘Enterprise’. Only HubSpot is geared to produce this type of business value however, so when you compare platforms as a MMB or Enterprise to Be, you can understand why HubSpot wins hands down and the migration to HubSpot from the other major players is accelerating.
You can also see why AMPED believes that your B2B marketing should start with an ‘Essential’ foundation. Get your Inbound Marketing house in order. Then we move you to ‘Growth’ where you augment Inbound with Content Amplification strategies that can increase your lead flow (often at a higher marginal CPL, but that doesn’t meant that these leads can’t be profitable). Your next step, ‘Enterprise to Be’ is where you connect the dots on your Pipeline Marketing Stack so that you can shrewdly allocate your marketing investments over time, and gain unprecedented visibility into the future of your business.
Inbound Marketing is bank.
WIth the right content strategy and consistent, high quality execution you can deliver ever increasing leads at ever decreasing CPL (Cost Per Lead). (Well, not really FOR-ever...more like an asymptotic curve that is steep at first then levels out at the lowest level CPL you will ever attain with any marketing strategy).
And the good news is, you can learn to do this yourself! We promise. Hey, if we did, you can for sure.
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