How Billion-Dollar Companies Do Marketing

The Divergent Marketing Strategies of Small and Billion-Dollar Companies

There’s a big difference between how small companies market and how billion-dollar companies do their marketing.

And it’s such a big difference that it gives billion-dollar companies a massive edge and keeps them at the top, while smaller companies are stuck in this rut, competing with each other just to maintain the same level of sales, month after month after month.

I don’t care if a smaller company is doing $1 million a year, or 10, or 30, or $50 million a year; most of them still fall into this category (not all of them), but definitely most of them, and the moment you understand this and shift your focus, your revenue, and your profit, your ability to scale up, grows massively.

It’s simply this…

When a small company thinks about growing, they normally look at their products or services and try to figure out how to market them in a bigger, better way.

Which might mean using Google ads, Facebook ads, Tabouleh, or Outbrain, or influencer marketing, radio, TV, or one of the hundreds of other ways to market those products or services.

Then they get caught in this loop of constantly looking for higher-converting ads on those platforms, better agencies to run those ads for them, and other ways to keep their cost per acquisition as low as possible, so they could... hopefully, maybe, possibly, be ROI-positive on the first day of the purchase.

Meaning they make back the money they spent on those ads as close to day 1 as possible, so if they spend $1000 today, they make at least $1000 back today.

And for most companies, it’s not that fast. Often, they need to wait a few days or a few weeks before that money comes back to them, but the challenge is always to find cheaper ways to advertise in a way that generates profits from that ad spend as quickly as possible.

And that’s how most smaller companies do their marketing. They look for more or better ways to market their products and services, and they hope to be profitable soon after acquiring each one of their customers.

And if they’re smart (and BTW, it’s very difficult to get to the 10, 25, or 40 million dollar mark or beyond without at least being smart about this part), then they look at not just the cost to acquire a new customer, but they also look at the average order value of that customer and the lifetime value of that customer as well, and then they automate the entire process of locating, attracting, converting, onboarding, and managing that customer for a long period of time.

The Approach of Billion-Dollar Companies

Billion-dollar companies look at this completely differently. And because they look at it differently, they scale far faster.

And I learned this years ago while having dinner with one of the vice presidents of a company that makes billions of dollars a week in sales. And what he said was that the great majority of the time and money that they invest in business is not spent marketing their products or services.

I want you to hear that again because every single guru out there will always tell you the number 1 thing you need to focus on is marketing or sales. And that’s exactly the opposite of what this guy was telling me.

He said the number one use of their time and money is to grow their reach. meaning how large an audience looks to them as the expert when they’re looking for a specific product or service.

The way I explain this to my team is, "When you’re on top of the mountain shouting your message, how many people hear you? More specifically, how many of our target market members hear us?”

So, when a company like Apple, as an example, comes out with any product, instead of spending a lot of money marketing it to the masses, they simply put it out there in front of their massive audience, who already know, like, and trust them.

My Experience

I remember when I started my first online business back in 2003. I had a group of friends who were all starting around the same time. And we used to brainstorm different ways to sell more products.

We each had eBooks that we were selling online, and everyone in that group was spending a lot of money on things like SEO, Google Ads, and affiliate marketing.

And most of them were netting a very small amount of money at the end of every month. Even the biggest guy there, who was making over $1,000,000 a year in gross sales (which was a lot for any of us at the time), was spending over $900,000 to make that million.

Certainly, times have changed, and most of the people in that group are making considerably more than that right now, but back then, even just $100,000 at the end of a year was still good because we were all just getting started online.

But there was one consistent thing with all of these companies, including mine.

And that's that the majority of our net revenue came from the money we made through our email list, not from actually selling our product through our ads, but rather through the emails we were sending people on our email list.

So rather than spending hundreds of thousands or millions of dollars in Google ads, SEO, or paying off affiliates, I looked for ways to increase the number of people we reached with our message.

If you watch my past YouTube videos or follow me on any social media platform, you'll see that my companies have done a lot of things to put our brands in front of large audiences and increase the number of people we reach with our message.

Everything from unique joint ventures to local radio ads, billboards on the side of the road, creative NASCAR advertising, and a whole lot of other outside-the-box ways of getting our word out.

And most of those didn't cost us nearly the amount that all my friends were spending on more traditional ads. And while they were all fighting for the same customers on the same platforms, trying to sell to all of those people as soon as they went to their websites, my company used more creative ways to get our message out to far larger audiences, and we drove people to websites that offered them things for free (if they joined our email list).

And because the great majority of net revenue (meaning profit) came from our email list, while my friends were making about 10% net, my company, back then, was making 70 to 80% net. And while they were proud to have email lists with about 100,000 subscribers, my email list had over 3 million.

So there's a big difference between small companies that fight each other for sales and larger companies that constantly seek new ways to increase their reach, or the number of targeted people who hear their message.

Now, I'm not suggesting that you switch from whatever marketing is working for you today, but I am suggesting that you put at least 10% of your marketing budget towards new ways to increase your reach.

If you do it right, then by next quarter, you should be far less reliant on the one or two platforms that are feeding you most of your sales, and you’ll grow far faster than your competitors, who are all fighting for the same handful of customers on the same platforms.