Applying Dollar-Cost Averaging to Your Marketing Strategy

I’ve been really intrigued by economic cycles and how money systems work over the past couple of years, and I think there are some fascinating parallels we can draw to the world of marketing.

What Is a Dollar-Cost Averaging Investment Strategy?

Essentially, it means consistently investing a fixed amount of money at regular intervals, regardless of market conditions. Whether the market is soaring or plummeting, you keep putting that same 20% (or whatever percentage you’ve determined) of your income into a low-cost index fund each month. You don’t need a broker to get started and many investment firms have them. It costs next to nothing in transaction or management fees, whereas if you wanted to pay a financial advisor, you’d pay a huge amount of money just for them to do that. 

Housel talks about Charlie Munger, who’s Warren Buffett’s partner in Berkshire Hathaway. Munger said that if low-cost index funds were around when he first got into investing, he probably wouldn’t have even bothered. You know all those big gains you could make by finding a really undervalued company, investing in it, and then selling when it hit its proper value? Those opportunities are pretty much gone now. And when they do show up, it’s kind of just a fluke.

Munger has said that trying to pick individual stocks isn’t really something us mere mortals should do — and even he said he wouldn’t do it himself these days. He’d stick to the consistent, methodical approach that is dollar-cost averaging in a low-cost index fund. 

By the way, you don’t need a broker or anything fancy for these low-cost index funds; places like Vanguard and Schwab have them. They’re funds that cover the whole market, so you’re getting a bit of everything. And while it’s not super exciting day-to-day or month-to-month, it moves along. More good news? These funds cost almost nothing: the fees are tiny, less than 1%. Compare that to paying a financial advisor, where you’d be shelling out a ton of money. Munger says that even financial pros don’t really know what they’re doing and can’t beat the market anyway. So you’re better off sticking with the index fund than paying someone to try and outsmart the market for you.

Bottom line: Dollar-cost averaging, low-cost index funds end up outperforming more active investment strategies. The consistent investment — no matter what — builds a foundation of stability and, ultimately, wealth.

How Does This Finance Strategy Mesh With Your Marketing?

This dollar cost averaging idea is exactly how it works with marketing: Consistently applying a strategic effort to your marketing yields better returns in the long run.  When you’re really busy, you market, when you’re really slow, you market. You say, okay, we’re going to dedicate this amount of energy, this amount of revenue to marketing. You can apply this amount of effort week in, week out, month in, month out — whatever you choose that is consistent, to make sure you’re always keeping the pipeline running. 

And that is exactly how it works: The people who really struggle with marketing, the ones who only get to it when times are hard — and at the moment, times are hard for a lot of people — it doesn’t turn out well for them. To really see success in your marketing, you want to keep applying effort no matter what, through the highs and the lows. When you’re super busy, when you’re super slow, when you have a lot of cash, when you don’t have a lot of cash, you just keep on applying the same effort to your marketing. 

I spoke with the executive director of a prominent organization of digital agencies recently, and I asked, what were they seeing happen in the industry. And they said the firms that take marketing seriously as a core value of their organization are much more resilient. It takes longer for a downturn to impact them, and they recover faster. This is because they’ve built a strong foundation, an audience that knows, trusts, listens to, and relies on them. They’ve been out there in the market, being genuinely helpful and educational for a long period of time and slowly built that great audience (read: referral networks). Their marketing flywheel gets spinning and all good things happen. 

Commit to a regular, consistent marketing cadence, whether weekly or monthly (though I’d recommend twice a month to see measurable results). Invest in building awareness, trust, and relationships with your audience. And trust that this disciplined approach will pay off in the form of a more resilient, prosperous agency over time. They say anytime is a good time to start investing — and the same applies here. Today’s the best day to begin dollar-cost averaging your marketing.

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