Understanding And Mastering The Time Value Of Marketing

marketing strategy

Those familiar with the financial markets will be familiar with the time value of money – TVM. As Investopedia explains, this concept asserts that money held today will be more valuable than money in the future due to its earning potential. Put simply, if you hold onto a dollar today, and do nothing with it, it’ll be worth less a month later, as competitors put their own funds into investments and grow them. Applying this principle to other areas of professional life is a handy way to consider effort made today, and marketers in particular can benefit from embracing time value in their efforts.

Understanding time value marketing

A straightforward way to understand TMV is by using a time value of money calculator. At the minimum, it shows how comparing interest rates against inflation will increase the spending power of one dollar today at any point in the future. How does this convert into marketing terms? Consider the customer journey of any one person engaged with your service or product. The sooner you can build a relationship and start engaging with them, the sooner you can start to understand their needs, how their priorities will develop, and how to keep your services moving to the market needs. As Forbes highlights, this is exactly how the time value of marketing operates – you invest in relationships today, rather than waiting, and as a result capture the maximum possible growth.

Putting it into action

To make a proper plan of how the time value of marketing operates, it’s also necessary to consider customer lifetime value (CTV). This is the process of identifying key customers and estimating what their lifetime contribution to your business will be. According to McKinsey, identifying and settling in these relationships takes three steps, the most important of which is investment. Money should be pushed into marketing efforts that target the correct sections of your customer base; understanding which customers are likely to spend the most over the lifetime of their service is key.

High quality interactions

Of course, the way to achieve this is through high quality interactions. Organic marketing is the way forward; natural link placement, accurate and honest SEO, and video content on social media to engage directly with audiences. This will help you to find the most well-suited customers for long-term growth, and ensure quality relationships are built with them. Your marketing should be deployed, quickly, too, to properly harness the time value of marketing. Quick, honest, and high quality marketing campaigns – these are the bedrock to securing great, lifetime customers, and maximizing their CTV.

This can be hard to grasp in the short-term. The world of business is so high-pressure right now, with so much competition, that it can be hard to look beyond quick wins. Marketing in a rapid and flexible manne will secure those quick wins, but try to keep the quality up; this will build your base, and keep maximizing the chance of securing peak CTV.

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