3 Simple Ways to Maximize ROMI and Get the Most Out of Your Marketing Dollars

Let’s be real for a second: most marketing agencies charge an arm, a leg, and probably your first-born, promising a treasure chest of results. The problem? Experience bias. They frequently believe the solution to your revenue growth problem aligns with their very isolated experience in marketing. For example: If they have a background in Public Relations, they're going to solve your revenue problem with an expensive PR campaign. Therefore, even if you use marketing "experts" to implement your strategy, the strategy needs to be your own, and needs to focus on maximizing desired business outcomes while minimizing ad spend and costs.

The reason I love working with Small Business Owners is because they've already developed a product or service worth investing marketing dollars in. It allows me to introduce simple marketing strategies to drive growth, knowing they can handle client retention and advocacy, because that's what they're already built to do.

A lot of marketing dollars are spent by firms like Groupon, which had short term success but never established a long term strategy to establish customer retention. A full Groupon case study on why their strategy was bound to fail might be an interesting read, if I get 5 people to comment on this article, I'll do the research and write it up. On the other hand, Amazon Prime is all about building customer retention by truly understanding their customer and continually investing in the services they provide.

Case Study: Amazon Prime vs. Groupon

Amazon Prime focuses heavily on customer retention, investing in perks like free shipping, exclusive deals, and streaming services. This retention strategy keeps customers engaged and loyal, driving a high Customer Lifetime Value (CLV). Prime members tend to spend more frequently, leading to higher margins and sustained revenue growth with relatively low acquisition costs.

Groupon spends aggressively on new customer acquisition, offering deep discounts to attract first-time buyers. However, most Groupon customers only make purchases for the deals and rarely return, leading to low retention rates. As a result, Groupon’s high marketing spend constantly replaces lost customers, resulting in thinner profit margins compared to Amazon's retention-driven model.

Just like in The Hitchhiker's Guide to the Galaxy, where the answer to life, the universe, and everything is humorously “42,” the secret to successful marketing is far simpler than agencies want you to believe: focus on ROMI, invest wisely, and tell your story consistently.

1. How to Calculate ROMI Like a Pro

You’re spending money on marketing—awesome. But where’s it going? And is it actually working? Before you throw another dollar into that digital black hole, calculate your ROMI.

Step 1: Basic ROMI Calculation Here’s the simplest way to calculate ROMI:

• Example: You spent $1,000 on Facebook ads. You generated $5,000 in additional revenue from those ads.

• Translation? You made $4 for every $1 you spent. Not bad!

Step 2: Compare Different Channels

• Run the same calculation across multiple channels (email marketing, SEO, paid search, etc) to see which one is driving the most return.

Step 3: Long-Term Customer Value

• Don’t forget to factor in Lifetime Value (LTV). If you spend $1,000 but acquire customers who’ll stick around for years, that changes everything.

2. Where to Invest for the Biggest Bang

Now that you know your ROMI, let’s talk about where to park your marketing dollars. Spoiler: It's not always Meta or Paid Ads. I'll break down more use cases for Social Media, Print, and Billboards, along with Earned Media, Retargeting, Display and introduce Programmatic Advertising and the emergence of AI as a workforce augmentation tool for marketing strategists in upcoming articles.

Example 1: Paid Search (AdWords)

• Why: High-intent customers. People are searching for your product, so they’re already halfway there. You’re just showing up at the right time.
• Example: You spend $500 on AdWords and get $2,500 in revenue from those searches. That’s an easy win with a ROMI of 4x.

Option 2: Email Marketing

• Why: Cheapest, most consistent performer. You already have the customer’s attention—now, you just nurture them.
• Example: Spending $200/month on email marketing tools, bringing in $2,000/month from your list. That’s a 10x ROMI—better than most social media campaigns.

Option 3: SEO

• Why: Long-term, organic traffic = no more constant ad spend.
• Example: Investing $1,000 into content and SEO optimization. Over 6 months, your organic traffic generates $15,000 in revenue. A slow burn, but a huge payoff with a 15x return.

3. How to Align Your Strategy with the Customer Journey

You’ve calculated your ROMI, you’ve picked your channels—now it’s time to weave your brand story through the customer journey. This is the part where marketing agencies usually hand you a “brand voice doc” and charge you five figures. You can do better.

Start with Awareness:

• Message: Who are you? Why do you exist?
• Example: If you're a sustainable coffee brand, start with how your beans are sourced ethically, aligning with customer values.

Consideration:

• Message: What makes you better than the rest?
• Example: Case study of how your coffee subscription saves customers money, reduces waste, and is more convenient than store-bought brands. This message must directly connect with the customers values or specifically solves a problem in a cost efficient way.

Purchase:

• Message: Why should they take action now?
• Example: Some might use a limited-time discount code for first-time buyers, creating urgency while staying true to your brand story. I prefer to use incentives in the advocacy stage, but something that moves the customer from consideration to purchase.

Retention:

• Message: Reinforce your values.
• Example: Email campaigns that follow up with stories about your impact on coffee farmers or environmental sustainability.

Advocacy:

• Message: Encourage sharing.
• Example: Incentivize referrals by offering discounts to customers who bring in friends. Tell them they’re building a community, not just drinking coffee.

Case Study: Patagonia

Patagonia is the poster child for storytelling. From the moment you interact with their brand, it’s clear—they care about the planet. From their “Don’t Buy This Jacket” campaign to their ongoing commitment to sustainability, every touchpoint reinforces their values. This isn’t just advertising; it’s storytelling woven into the customer journey. Their message doesn’t change; it just adapts to where the customer is in their journey.

Disclaimer: Yes, I love Patagonia, it's my favorite brand story (click the link to check it out) because it's how brand stories should be, a story of engineering solutions for actual problems and standing for something important while you do it. I'm a little tired of the cash grab founder model (e.g. products sold through infomercials or flashy social media ads with huge discounts), it leads to extreme waste, excessive market interference, and the degradation of consumer trust.

If the wasted resources on cash grab ventures were reallocated to the consistent small business owners that deliver a sustainable product or service, we'd actually improve sustainable GDP growth, reduce environmental impact of freight and shipping products around the world, and provide SMB owners the livelihood they deserve for providing the essential products and services we need.

Setting Up Your Customer Journey Map

Once you’ve chosen where to invest your dollars, align it with a Customer Journey Map to make sure your message is consistent at every stage:

• Awareness: Paid search ads or blog posts that introduce your brand story.
• Consideration: Retargeting ads and email campaigns that provide more detailed info (case studies, testimonials).
• Purchase: A clear call to action (FWIW: I'm not usually a fan of incentives (discount, free shipping), but I recognize there are situations where they can generate trial).
• Retention: Follow-up emails and targeted content that reinforces your story.
• Advocacy: This is where I prefer to use incentives, something that encourage customers to share their experience with others.

Keep It Simple and Consistent

At the end of the day, marketing agencies love to overcomplicate things. But if you can track your ROMI, choose the right channels, and stay consistent with your brand story across the customer journey, you’ll outsmart the flashy ads every time. And hey, with AI tools in your corner, you might not even need those agencies much longer.

References:

• Building a StoryBrand by Donald Miller
• Contagious by Jonah Berger
• Made to Stick by Chip and Dan Heath
• The Hitchhiker's Guide to the Galaxy by Douglas Adams