In marketing, as with all other aspects of business, your competitors get a say. It should come as no surprise that business is a constant competition. Just like in any race, your competitors influence the marketing landscape, impacting your business outcomes.
A Case Study: Gaining Ground in St. George, UT
One of our clients, a local service business in St. George, UT, was ready to "take over" their market. Their business thrives during a 4-5 month busy season, with the rest of the year spent scraping for revenue.
We started working with them just before their busy season kicked off, and they saw immediate results. They had a record year with a Return on Ad Spend (ROAS) of 1000%, generating $10 for every $1 spent on marketing. This success allowed them to more than double their staff.
Confident in their growth, they increased their marketing budget, aiming to double their revenue from the previous year. But something strange happened: despite increasing their revenue, their ROAS stayed around 1000%.
Why?
Marketing is a Long-Term Investment: If throwing money at marketing could consistently double or triple results, everyone would do it. Real growth requires long-term investment and patience. Short-term gains are possible, but sustainable success demands a longer view.
The Competition Has a Say: Our client's industry is highly competitive, with at least half a dozen other businesses vying for the same customers. As our client increased their ad spend and won more market share, competitors noticed and responded by upping their own marketing investments. This bidding war drove up ad costs, keeping our client's ROAS stable but preventing the exponential growth they hoped for.
Next Steps: Building a Resilient Brand
While our client's performance marketing remained profitable, it became clear they needed to focus on more than just ads to achieve their growth goals. The next step was to invest in their brand.
Building a brand is a long-term endeavor, but it's worth it. According to Harvard Business Review, businesses with a brand strategy see 10-20% more growth than those without one.
Conclusion
Marketing is challenging. With shifting consumer behavior, numerous channels, and a tough economic climate, maintaining momentum is hard. But one constant remains: your competitors will always have a say. Their actions influence the market as much as yours do, and understanding this dynamic is crucial for long-term success.
To stay ahead, diversify your marketing efforts. While performance marketing can yield impressive short-term results, relying solely on it leaves you vulnerable to competitive pressures and market fluctuations. A strong, recognizable brand can buffer against these challenges, creating a loyal customer base and providing a competitive edge.
If you have questions about marketing or want to chat, shoot us an email at justin@jsxmarketing.com. We're here to help you navigate the competitive landscape and achieve your business goals.
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