Content creation is an investment, not a marketing expense
Updated: Apr 27, 2020
He echoes my belief that content creation cannot be looked at the same way as other marketing expenses like advertising, trade show booths, agency retainers and printing. David believes we have to “Stop thinking of content creation as a marketing expense” as this way of thinking will always lead you to under-spend.
He goes on to explain that, if you spent $5,000 a month on a Google AdWords campaign, the only thing you bought was the ads appearing in the search results and the resulting clicks on your ads. But as soon as you stop paying, your advertising and clicks completely stop. This is a classic example of a marketing expense. You pay for something and when you stop paying, it immediately goes away. However, if you spent the same money for a journalist to write a series of interesting blog posts, that content will live on beyond that month. It will drive people from the search engines to your web site, FOR FREE, for years to come. The content will retain its value for many years after it has been paid for.
Investment in content is not a short-term advertising expense but the creation of a long-term asset. David believes that Blogs and YouTube channels should find a home on our balance sheets and should be valued the same way as patents, trademarks or brands.
And he proposes a metric to do so: “AdWords Value Equivalency”. If the content you invested in has you ranked high for a search term organically, simply calculate how much you would have paid for that search term: the maximum AdWords price you would have to pay times the number of searches or clicks. He argues that, over time, that could be worth hundreds of thousands of dollars.
In terms of video, it may be harder to have such a straightforward calculation, but not impossible. One of our clients has three HR people combing through 1000 résumé's PER job opening. A candidate of this quality will have multiple offers on the table. Over the lifetime of your business, what is the value of reusable content that will compel them to want to join your company, based on a clear articulation of YOUR WHY? What is the value of stories that make current employees prouder of where they work, thereby increasing their level of engagement, which is proven to improve customer service? What is the value of the social approval and social imitation generated in prospects, who will be inspired to engage with you based on heartfelt testimonials about your unique customer experience from raving fans?
It’s not hard to see that content is a lasting investment and needs to be weighed differently, given how its value can greatly outweigh the original investment.