How to Get Exponential Growth in Marketing

Compound growth is the 8th wonder of the world.

Warren Buffet was a big fan of this quote by Einstein, and he used to share an anecdote with everyone he met:

In 1626, the Colonizers bought the island of Manhattan from the Chief of a Native American tribe that was, at that time, roaming that plot of land with a trinket that was worth around $24 back then. (a couple thousand dollars in today’s money)

So here’s Warren Buffet’s excitement:

IF the Chief would have invested his $24 into the S&P 500 back then (obviously, it didn’t exist back then but let’s assume that it did), and he would have compounded that $24 at an annual rate of 8% on average (roughly what you can expect from the S&P 500), then…

In 2022, roughly 400 years later, the Chief would have enough money to buy back the whole island of Manhattan, all of New York City, and everything within it: all the buildings, companies, and banks.

Because $24 compounded 8% per year over 400 years is around $400 trillion. That’s roughly 20 times the GDP of the United States in 2021.

And compound growth applies to marketing too.

But most marketing teams constantly chase the magic pill: the magical channel where they will go viral, and everything will just explode. And customers will be knocking at their door 24/7.

And if it doesn’t turn into leads after month 1, they move on and try the next thing.

For example, they will write some blog posts on their website, and nothing happens. So, they stop doing blog posts and switch to podcasts.

And after a couple of episodes, they realize it is a lot of work to produce a podcast and find guests weekly, and there are no leads, so they move on.

Then they write some LinkedIn posts because they saw some people go viral on the platform.

And in the first month of posting, they get a few likes on their posts and continue posting for another month, so after a couple of months, they move on and try the next thing, because they didn’t “go viral”

The problem is that they never benefit from compound growth. Because that’s how compounding works: it’s very slow in the beginning, and it takes a while until you realize that it’s working.

So, companies and marketing teams need to start thinking about committing to an activity build a foundation.

Otherwise, they will never benefit from the fruits of compound growth.