Watch out for this marketing fraud by Laura Betterly
I had a potential client come to me about two weeks ago and said he found a company that could get him on the front page of Google for $400.00 a month. Knowing what I know about Google, and all the years of experience in the area it sounded too good to be true. It was.
We called this company to figure out what they were doing. They were calling there service Search Engine Placement. We asked if this was Google AdWords and they guy kept saying (as if we didn’t understand such things) “ hmm The Google Algorithm, The Google Algorithm…”
Well, what we found out is this: it was Google AdWords and what he was doing was buying one specific keyword like “dentist Kalamazoo Michigan” that didn’t get searched often. The problem with this is although he wasn’t technically lying, how does this benefit the client? It doesn’t, unless those specific strings of words are actually searched. It’s just another way some unscrupulous people are making a bad name for the industry. I wanted you to know.
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February 21st, 2006 at 9:47 am
Every company is different. I've noticed that the companies I have worked for spend approx 20% revenue on marketing and advertising. So if you make 1 Million in Revenue they'd spend about $200,000 on marketing/advertising. but it all depends on profitability. if most of your revenue is going back into your overhead you'll have to spend less.
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spent my career in marketing/advertising.
March 25th, 2006 at 12:51 pm
This is a very broad scoping question. Each specific industry will spend a different percentage of gross revenue on advertising. If a company has good exposure to a physical location, lets say they are located on a busy street and they are a retailer, they don't need a large budget for advertising. Furthermore, product specific companies will fluxuate advertising costs based on where they are in the product life cycle (Educational advertising costs may be larger than other costs).
There are two primary ways that a company can decide budgets for advertising; top-down and bottom-up. Imagine upper management on top and marketers on bottom. In a bottom up situation, the marketers will design the budget and propose it to management. In a top-down approach, the management will give marketers a budget cap. From here, it gets more intricate and complex as to how actual figures are determined, but they are mainly determined by an analysis of your target market and the eficacy of different advertising channels in communicating the marketing message to said audiences.
Overall, advertising is normally one of the largest expenditures that a company makes. Consumer electronics companies like Sony and Panasonic spend a large amount on marketing. Advertising is a part of marketing and represents a large portion of the marketing budget. But, again, it all depends on the specific company and its current exposure and what point on the PLC you are talking about. Answer those questions and you should be able to find a more specific answer via your resources.
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