January 7

Unlimited budgets for ads that work

Advertising budgets. The bane of any account person’s existence. But why do we have them?

Immediate excuses that pop into mind include: “because we have to our numbers for the quarter”, “the recession means we have to curtail our spending” and “cause my boss said so.” But Seth Godin sees it differently.

When Amazon was at its key growth peak, the mantra there was $33. They would buy unlimited ads, of any kind, as long as they generated new customers for $33 or less each. There was a risk that $33 was too high a number for the business to sustain, but the ads were no risk at all. As long as they came in under that number, there was unlimited money to buy them.

Read his smart article on ad budgets here.

Source: Seth Godin