Most businesses can’t succeed in online marketing because they don’t understand this strange effect in marketing, as shown in the attached graph.

The blue line represents people’s expectations when it comes to marketing. They think that if they 2x their ad budget, they’ll get 2x the results.

BUT… That’s not what really happens. 😱

The red line represents reality. As the ad budget increases, the results grow exponentially. A 2x budget increase causes an x^2 result increase!

Not understanding this is why most small businesses don’t succeed in digital marketing.

They think that they can start out with a very low ad budget, wait until they get results, THEN increase the ad budget. But it doesn’t work like that.

People that do this (and I’ve been there myself) typically get no results at all, then proclaim “online marketing doesn’t work” (meanwhile large businesses dropping millions like it’s nothing).

Why is it that lower ad budgets cause failure, whereas higher budgets give you exponential results?

Lower ad budgets prevent you from testing variation (different images, text, etc.), collecting data faster (to properly update the strategy), and you also get less exposure.

The last one is quite important- only so many people buy the first time they see your ad. Most people typically need to see your ads a few times before they buy.

There are a few other reasons I won’t explain now as they’re complicated high-level marketing stuff (custom audiences, lookalike audiences, stuff like this for those that know these terms).

The important thing you need to take away here is if you own a business you should wait to run ads until you can properly invest in them.

The less you can spend initially, the more likely you are to fail. It’s kind of ironic actually- the fear of losing money causes you to spend less, thus making you more likely to fail!

I’ve turned away potential clients for this reason actually. You need to have a little courage, OR save up for a proper marketing campaign if you hope to get anywhere.

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