What’s the best way to do effective marketing?

Bill Gurley (General Partner at Benchmark Capital)
The Dangerous Seduction of the Lifetime Value (LTV) Formula | Above the Crowd | By Bill Gurley

Marketing executives like big budgets, as big budgets make it easier to grow the top line. The LTV formula “relaxes” the need for near term profitability and “justifies” the ability to play it forward – to spend today for benefits that are postponed into the future. Consider that most companies limit any “affiliate fee” they would be willing to spend to 5-10% of sales. Yet when they are marketing, they use different math. They use LTV math, and a… (read more)