One of the most common pieces of advice to new investors is to “diversify your portfolio.” Essentially, this means investing in a wide range of different asset classes and getting exposure to many different markets at once. This way, you improve your resistance to risk and volatility, you minimize your potential losses in the wake of a catastrophe, and you may even increase your lifelong returns.
This approach can also be beneficial for your marketing strategies, especially as an emerging business.
What Does It Mean to Diversify Your Marketing Strategies?
Let’s start by reviewing some of the ways that you can diversify your marketing strategies.
- High-level tactics. It’s possible to use a mix of different high-level approaches. For example, do you want to win over customers with temporary but explosive, high-profile campaigns? Or would you rather put out a sustained, consistent stream of branding materials? Do you favor traditional marketing or more novel guerrilla marketing tactics? Well-diversified marketing portfolios use a mix of different tactics.
- Channels. One of the more obvious routes to diversification is to use a mix of different marketing channels and platforms. You can incorporate a number of complementary and differentiated strategies, such as search engine optimization (SEO), PPC advertising, podcasting, printed ads, and even billboards and radio ads. Additionally, you can invest in different platforms within those channels. For example, in the realm of PPC advertising, you can work with alternative ad networks outside of the traditional “Facebook and Google” continuum to reach more people and potentially see better results. This is the approach common to “multi-channel” or “omnichannel” marketers.
- Target audiences. Some brands have a focused, uncompromised target demographic. Most brands have multiple audiences, or are somewhat flexible in the people to whom they appeal. If you’re willing to bend your target audience slightly, or if you have multiple target audiences to work with initially, it’s advantageous to broaden the scope of your targeting as a form of diversification.
- Style of messaging. What is your overall style, and what kind of messaging do you want to include in your ads? You might have clear, consistent brand standards in place, but even within those constraints, you may have the flexibility to change up your messaging style. For example, you can include ads with simple, minimalistic, straightforward lists of benefits, and ads with more colorful, descriptive copy. You might even be able to include both in the same ad at times.
- Budget and investments. You also need to think about how you’re spending money. Do you want to invest in these tactics as aggressively as possible, reaching more people in a burst of activity? Or is this more of a marathon, requiring you to minimize your investments and commit to a long-term, steady engagement? It may be helpful to have many types of strategic investments available.
The Benefits of Diversification
Diversifying your marketing portfolio, if it can be called that, has many benefits for your brand:
- Broader appeal. For starters, you’ll win broader reach and appeal. Today, the internet is practically ubiquitous – but that doesn’t mean everybody uses the internet. There are still segments of the population that don’t spend much time online, so if you exclusively invest in digital marketing tactics, you’re never going to reach them. Investing in a wide range of different channels, and targeting multiple audiences will help you reach more people total – and get through to segments that might otherwise be lost.
- Higher awareness. It’s also possible to build more brand awareness through these diverse tactics. Studies show that repeated exposure to a brand leads to much higher familiarity and trust; that’s why so many ads rely on their repetitiveness to create effective messaging. If you’re dominating many channels at once, your customers will become more familiar with your brand much faster – and you might earn a better reputation as a result.
- Better customer relationships. You can also make the argument that more diversified marketing approaches can lead to better customer relationships. You’re able to reach more people in a wider range of different ways and onboard them more successfully as well.
- Steadier returns. Marketing channels don’t experience the same boom-bust cycles as, say, the real estate market, but you’re still going to experience seemingly random ups and downs with different channels. If you’re exclusively invested in one channel and it suffers a major decline, your entire branding efforts could be in jeopardy. If, instead, your marketing budget is spread out across a variety of channels, a major blow to any single channel won’t impact your overall results by much.
- More information. Getting exposure to different channels opens your potential to receive more varied and thorough information about your target audiences – and possibly about your competitors. Studying how your demographics behave across multiple channels allows you to kind of triangulate your perception of your average customer persona – and challenge biases and preconceived notions that might have been holding you back. This assumes that you’re tracking your marketing data well across all channels you’re currently utilizing.
- Competitive protection. Competition can be a threat in the marketing world; if a competitor is too aggressive in your channel of choice, it could drive up prices, force you to suffer losses, or even compel you to withdraw entirely. If your marketing portfolio is sufficiently diversified, however, a new competitor isn’t as big of an inconvenience; you can simply rebalance and move on.
The Case Against Diversification
The benefits of marketing diversification are impressive, but there’s also a case to be made against diversification. In some ways, marketing is a game of minimization and maximization. You’ll want to minimize your spending and effort in areas that don’t favor your brand and maximize your spending in effort in areas that do. Over time, that will maximize your ROI by reducing expenses and improving returns.
This approach practically necessitates cutting inferior strategies in favor of superior ones. For example, let’s say you’re making a lot of money from SEO; its ROI is higher than any of your other strategies and in terms of sheer impact, nothing else even comes close. You’re currently spending $5,000 per month on your SEO strategy, while spending $2,000 on social media ads and another $1,000 on printed advertising.
If SEO is your top performer by far, and there are no unique benefits to be found in the other areas, why shouldn’t you just pool together all $8,000 and spend it all on SEO, while cutting the other channels off completely? Wouldn’t you end up seeing a return that’s, overall, much higher?
Narrowing the scope of your marketing work also gives you an opportunity to specialize. If your top marketing experts are juggling many different strategies simultaneously, they automatically become generalists. If, instead, they focus exclusively on one or two categories, they’ll develop skills in those areas much faster – and have much stronger long-term potential.
Obviously, the real world is typically much more nuanced than this example would suggest. Suffice it to say, the case for diversification isn’t always clear and straightforward.
Tips for Using Marketing Strategy Diversification
If you want to get more out of your diversified marketing strategies, follow these important tips:
- Work with experts when possible. The better your team, the better your execution will be, regardless of which tactics are currently in your arsenal. Try to hire the best people possible in a variety of different disciplines, or work with marketing agencies to see better results.
- Feel free to specialize. While diversification is important, it’s also important to specialize in the areas most valuable to your business – and lean heavily toward them. Find the balance for your own business.
- Make decisions objectively. Rely on data and objective observations to make your decisions – not whims or intuitions.
- Rebalance periodically. Take the time to rebalance your marketing portfolio regularly, just as you would an investment portfolio.
There are countless ways to approach marketing and advertising, especially in today’s world of strategic and technological complexity. If you’re only using one strategy, or one group of strategies, you’ll be artificially limiting your potential. Use diversification to reach more people and see better results for your brand.