How a Well Thought Strategy Saves You Money
For the first time last week I heard a phrase from a friend called “machine gun marketing” and I thought it really hit the nail on the head to describe how some businesses go about utilising their marketing dollars.
The premise of machine gun marketing is when a business haphazardly spends money on marketing activities with the idea that any marketing activity will hit a bullseye and bring in money. There didn’t appear to be much thought around why the activity would bring more revenue.
There are some questions businesses should ask themselves when they are considering where to put their marketing dollars when building a solid strategy.
Question 1 – What is the entire process involved with each activity?
When you are approached by a business development manager who wants you to invest in their service, be sure to ask them exactly what is involved.
For example, you’ve just bought a space in an industry magazine and you’ll feature in the next edition. Besides the cost of the advertising space, what other associated costs are included? Do you need to provide the advertisement itself? That means images, copy and graphic design to put it all together in a way that looks good and is the right file size for the publication.
So now we have the cost to either use a photographer or buy a stock image. As well you also need to consider what to say and how to say it? What’s your pitch?
Do you have all the suppliers you need to create this advertisement? Where would you start looking?
Now it’s not just the cost of the space for the advertisement, it’s the photographer or stock shot, copywriter and graphic designer. Often there are more costs associated with the activity you’ve just bought.
Question 2 – What are the anticipated financial returns for you invested marketing dollar?
Can the supplier of the marketing or advertising service tell you on average what sort of business return their clients receive? Every business operates differently and has different expectations. For example a large corporation may anticipate a 2%-4% take up for a direct marketing campaign which is acceptable because their large number of clients means the return on investment is high.
This kind of take up for a smaller business may not be feasible. It is important to ask some questions around average returns businesses may gain from participating in a particular marketing activity.
Question 3 – When should I do a marketing activity?
Businesses often have an annual cycle. There are peaks and troughs throughout the year so when is a good time to do marketing activities? During the peak times you may want to maximise the opportunity by placing an ad or making an offer but conversely some activities may really help the troughs in your calendar year to make it more bearable.
It’s a good idea to create a 12 month calendar and plot in when you would complete marketing activities. This means you can set your budget and have finances ready to go and it helps with anticipating cash flow.
Question 4 – If I’m doing a new activity should I go all out or maybe sample it first?
A lot of large organisations will run a test campaign to iron out any teething problems with a new marketing activity. I remember one organisation I worked for referred to the recipient of a direct marketing campaign by their first name and the take up was poor as a result.
Using the feedback from the call centre they realised this problem and rectified it. The take up changed from 6 new clients per week to over 200 per week as soon as small changes were made to how the customer was spoken to.
Testing the market with a new activity will show whether or not it’s something worthwhile continuing with, axing it or making some slight alterations.
A well thought out marketing strategy can save businesses a lot of money and pain. Throwing marketing dollars in a “machine gun” approach generally means a lot of money is spent unnecessarily into activities that produce little or no financial results.
Think through the whole process and look at the year ahead. It’s a great way to set budgets and set up expectations.
You’ll find your results compared to what you planned will probably be close.
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