Below is an example graph of what you should be hoping to achieve with your marketing strategy.
This is not an exact science & many factors can influence the growth of your brand, but this graph shows an example of what you should be trying to achieve.
When launching a brand, it is not as simple as just making good product, creating a website & turning on advertising & seeing sales & direct return on investment.
First & foremost you are building a brand. A bi-product of creating your brand is the sale of your products. It your case this happens to be the sale of clothing, but it could be anything, from computers to toothbrushes, from dog food to soft drinks.
Marketing is the key, not necessarily the product!
What you are trying to achieve with your marketing is to initially drive consumer awareness, followed by consumer engagement & ultimately sales conversions. Subsequent repeat business from existing consumers helps contribute towards your average ‘customer lifetime value’.
This graph is to try to illustrate the overheads (i.e. cost of goods + marketing & other overheads) vs. the revenue (i.e. sales)
Initially there will likely be high overhead investment into product & marketing, over time the sales will start to increase eventually overtaking the overheads, repaying the investment & turning into profit.
The speed at which this happens is subject to many factors, not least the speed at which the marketing budget can be applied, the design & quality of the product & the ‘X-factor’ of when the brand takes hold of the consumers imagination.
The X-axis denotes time & the scale changes from months to years (condensing the data).
The Y-axis denotes cost/revenue & the scale changes from /£10k, to /£100K to /£1m , to /£5m (condensing the data).
As you can see from this graph, there is initially investment into product (red) + marketing & other overheads (navy).
As the brand starts to gain traction, the sales revenue (blue) starts to increase. Slowly at first (as you drive brand awareness), then it should start to speed up significantly (as consumers start to convert & your average ‘consumer lifetime value’ starts to increase), then it should hopefully start to rocket (as the brand takes hold on consumer imagination).
We would hope that by the C.18-24 month period the sales revenue starts to overtake the overheads & by year 3 the brand is into profit.
Below is the same graphic illustrating this.
Due to how the graph condenses time & cost / revenue you will see below that the ‘break even’ point should hopefully come around the 18-30 month stage & by the 36-42 month stage the brand will hopefully not only be in profit but have re-paid any previous investment as well.
Given a long enough time scale we’d hope to see something like this (with a bell-curve). How high that bell-curve might go is anyone’s guess!