by Bernadette Peters, Natural Marketing Services, LLC
It’s the new year again. We’ve all been working on budgets, evaluating our financial strength and setting goals for the new year. One of the biggest challenges for any business owner or manager is creating a marketing plan. There’s a misnomer out there that the plan requires several months of work and the final result is a large tabbed notebook of strategies and initiatives. But that’s not necessary to create a plan that you can implement in 2010.
As a marketing services provider and consulting firm, we have worked with a lot of small businesses. They all need a marketing plan, but didn’t necessarily have the budget or time to go through the full marketing planning process. So we developed a phased approach that any business can use to produce positive results in the short-term and over the long term.
It looks like this:
- Evaluation/Discovery
- Strategy Document
- Implementation Plan
Evaluation/Discovery: When a business is small, the owner or manager has a pretty good sense of where his or her customers are coming from, which marketing strategies are working or not working and the general areas that the business needs to focus on to grow. But as a business expands, owners and managers “wear fewer hats” and are more disconnected from the reality of their marketing effectiveness. The evaluation and discovery process provides real data to get the owner or manager back in the driver’s seat. Actionable data is the result of this process. During our client marketing strategy session, we go through a discovery process which looks like this . . .
- Financial – this discussion centers around revenues, profit margins (per product/service or customer group), average number of transactions, average transaction amount, growth goals for the following year.
- Target Market – we look at existing customer demographics, psychographics, buying behaviors, then combin the financial data with this information to determine adjustments to the desired target market, and products/services that go with that market.
- Database – since data is everything, we look at the types of data that the business maintains on their current customers, inactives, prospects and strategic/referral partners. We evaluate trends through reporting that will help shape our strategy phase of the plan. We also look at the marketing tracking – activites that lead to new sales, retention, or cross-sales to existing customers.
- Marketing activities and infrastructure – this is probably the most time-consuming part. We look at all marketing, communication and sales initiatives for the year, evaluate their effectiveness and prepare for the decisions we will make in the strategy phase of our plan.
And guess what? If you never get past the first phase, you’ll still have created something valuable to make a difference in your marketing. But if you want to go from “good” to “better,” move to the Strategy phase.
Strategy: This is where we take all the data from Discover/Evaluation and create ideas to improve on what’s working, make decisions to remove what is not working, and then reallocate funds or effort toward new marketing initiatives that we will test and track in the coming year. The result of this process can be a one-page marketing plan listing specific goals and high-level initiatives or a multi-page document with enough detail to get the process started.
At this point if you don’t have the time or resources to move into the implementation phase, you can use this document to move forward. We suggest going back through it to rank the initiatives in order of potential effectiveness (A, B, C), then list target dates for each initiative.
Implementation Plan: If you have a team to help you implement the marketing strategies, we highly suggest moving to this phase which will take your plan from “better” to “best.” This is where you put specific information to your plan. Each initiative will have associated tasks, resources needed to implement them, and time required for each step.
Although Microsoft Project may be more software than you need for this process, you may want to consider using it or something similar. One of the key features we use is the “predecessor” fields so if one step gets delayed or an initiative re-prioritized, you can easily change the target dates of all associated tasks for that particular project. You may want to use something as simple as an excel spreadsheet. Remember, for each marketing initiative, you will want to test and track its effectiveness, and possibly adjust the marketing channel or message in order to find the most effective approach.
Here are some metrics we recommend tracking. This works for direct response initiatives (promotional programs, events, mailing, advertising), but is not as effective for branding strategies.
Response rate – you will need to define what a response is for you. It could be a sale, an inquiry, the prospect giving you an email address, etc. Response Rate = # of responses/number of impressions (mailings sent out, number of ad copies, etc.). The goal is to increase responses.
Cost per Acquisition – what it costs the business to acquire a new customer. This can be tracked on a business level, customer group level or even a campaign level. The goal is to reduce it over time. On a business level, you can divide what you spent on marketing or sales and marketing by the number of new customers acquired for that year. That will be your baseline. We’ve had clients track it on their business customers separate from their consumer customers, or even by affinity group. On the campaign level, you can track what you spend on the campaign and divide by the number of new customers you acquire directly from that campaign.
Just remember that in everything, even marketing, there’s a good, better and best approach. Going through the evaluation and discovery process will provide you with a good sense of what needs to be done in the new year. The strategy phase will provide a better approach with identified initiatives, and the implementation phase offers the best approach toward achieving your growth goals in the new year.