Is it worth paying for advertising?

I've not written a businessy-type blog post for ages. I guess that's because the rate at which I'm learning things (and therefore have new things to share) is slowing down now my business is more established. I've been thinking about advertising again recently though, so thought I'd share my thoughts.

If you run a small business or sell your handmade products this is probably a question you've asked yourself at some point - is it worth paying for advertising? Or, more precisely, is it worth paying for this particular bit of advertising that I'm considering?

Until you have tried a particular channel of advertising it is very hard to know if it will bring you any additional sales. This is something that I have learnt to accept. Sometimes you just have to spend a little bit of money to try things out, and then change track if it's not working. But I like to at least be able to evaluate an advertising opportunity and see if I think it might be worth it financially.

So I thought I'd share how I consider a paid advertising channel. This is just really from a financial perspective - of course you will also need to think about whether the advertising will reach your target customer and is in line with your brand.

I hope that's helpful. Sometimes this helps me see that I should definitely pay for a piece of advertising, and other times it helps me realise that I would never make my money back. A very tempting advertising offer can suddenly seem not so appealing when you work out how many items you would have to sell to make it worth while!

You can use this method for free advertising too, by converting your time into a financial cost. If it will take you an hour a week to maintain a certain advertising channel, change this into a monetary cost by using the hourly wage you want to be paid. Then you can use the above calculation to see if it's worth the time investment.