A photographer once told me about a recent wedding fair they had exhibited at. I asked them how much they’d spent on doing it (in region of £1,500) and how many bookings they got from it (one booking for £1,500). To my surprise they seemed very pleased. “I booked a wedding from it so it was worth doing” they proudly said to me. Because they’d “covered their costs” they felt it had been a success.
Without even taking the huge amount of time that fair would have taken to plan for and then be at (and the opportunity cost of that), this was not a success because ‘return on investment’ (ROI) needs to be looked at with a different lens via a a more telling metric ‘cost per booking.’
In this instance this photographer had got got a £1,500 return on £1,500 spent – £1 for £1 spent. But their cost per booking was £1,500. If they did that for every booking they would run a business with zero profit.
ROI in wedding photography businesses is crucial and it’s why I will only spend when I can see a fruitful ROI. It’s important to be single-minded and very critical of anything you’re spending on to ensure it pays back.
Let’s say someone offers you a blog advert for £500 a year. If you get one booking that’s £500 cost per booking – which in my book is way too high. If you spend £500 and get 10 bookings a year at £50 per booking that’s not a bad ROI and I would say that is a good investment (and one to continue with).
A good approach is to lay out all your marketing activity and then work out how many bookings came from each area, and the total spent on each. You’ll then have a clear picture (excuse the pun) of what activity gives you the best ROI in terms of cost per booking (and what you should continue to focus on or stop doing).
I will stick my neck out and say you’ll most likely see that word of mouth comes out on top (given it’s free) and that’s why I recommend all small businesses put advocacy at the top of their marketing plans. More on that coming up!