90% of businesses want more sales….. and for the vast majority of these businesses – this is exactly what they need. Many businesses can make a better margin out of their existing sales, but overall a greater level of sales is what is required to allow a meaningful increase to the bottom line.
Effective marketing is the ultimate answer for increased sales opportunity, with many different marketing methods available, BUT….. a critical aspect which is frequently overlooked in the assessment of marketing effectiveness is the time and cost of the activity.
If left unchecked, not only could the marketing activity be yielding little benefit, but it could be milking valuable cash from the business at the same time. To highlight how this can occur, I have listed below a few common marketing activities which will lighten your pocket if not controlled.
The do it myself
A business owner’s time is finite, so the “do it yourself” approach in an area in which you are unfamiliar will normally be a false economy. It will draw considerable labour dollars, direct time away from core activities (often billable hours) and generally deliver a poor quality result.
A classic example of this is a DIY Web Site build. Businesses will agonise over spending money on a website build before opting to “go for something cheaper” by building it themselves. Regrettably little or no consideration is given to the cost of their time to build the site – which can be considerable, let alone the actual quality of the site and its end performance.
Networking and Meetings
A significant amount of marketing time (and money) can be lost in the area of “network functions” and “meetings with contacts”.
Networking events need to be assessed like any other marketing spend, being a return on investment. Calculate the cost of your time and the fees to attend the event, with this representing your baseline. For a weekly meeting this could quickly represent a $10-15,000 per year investment. Taking your product suite and margin into consideration, reverse engineer this to calculate the sales volumes needed to break even and then recalculate to include your desired profit return from the activity. This type of calculation will quickly put networking into perspective and show that you must gain real sales activity from it. Naturally the same calculation applies for your staff who are attending “networking” on behalf of your business – and of course, at your cost.
Attend network events with the knowledge of the cost of attending and a clear objective of what you need to obtain from it.
Contact meetings are very similar to the networking groups in that you can spend many hours and dollars meeting “for a coffee”. To avoid the caffeine pit of despair, each of these meetings also needs to be optimised to ensure an appropriate return.
A few suggestions to improve these;
- Book the contact meeting for 30-45 minutes and not an hour.
2. Raise an invite confirming the relevant details to limit “no shows”.
- Set an agenda and include this in the invite. Every meeting should have an objective, so your agenda needs to be aligned to this. The clearer you can be on this, the more likely you will achieve it.
- Business is seldom completed on the first pass, so each meeting should simply be part of a wider pattern which you manage. Management includes setting the next meeting, following up on promised undertakings and actions. As with the networking groups, you need to regularly assess the physical margin return from this activity.
Generic Marketing Material
Marketing should also be aligned to your target market for optimal penetration as wide spread generic advertising tends to be hit and miss. A common item which seems to deliver hit and miss results is the humble junk mail article. Whist these may work for some of the big retainers with the larger multi page catalogues; businesses tell me that the smaller brochures provide very little return. If you are using this tool, then critically track the success of your next campaign to make sure is it financially viable and delivers the required return.
The time spent managing a social media campaign, with blogs, tweets, posts etc can be a time consuming process for the uninitiated. As with the web site comment above, if you are not familiar with this technology, then it may be more effective to outsource this to someone who is. Technology aside, it is important that you have a clear understanding of what you are trying to accomplishment with your social media; is it brand building, product awareness, a soft sale pitch, a client value add or a prospect nurturing campaign? The objective of your campaign will naturally dictate the format and content of your message. Remember, a campaign with no direction is likely to achieve exactly that result.
The Whole Package
A common aspect with many small businesses, is they spend hard earned cash on only one part of a campaign – which unfortunately results in a very poor result. The most common example of this is paying for a new website, but then doing no SEO or AdWords to drive people to it. Frequently I see some really good looking web sites, but the traffic landing on it is simply too low.
To avoid this type of issue – budget for all of the relevant aspects. Often the best plan if you don’t have a real budget, is to wait for a while, generate the cash and then execute the campaign correctly.
With all forms of marketing – the core measure of “what it delivers” in hard dollars and cents is my default measure. Every program should be regularly assessed against required performance targets and if they are not delivering, then change them.