Marketing – a staple or a luxury?

As many parents know, kids can gaze into the pantry or fridge and categorically state there is nothing to eat, even when they are well stocked with the staples such as eggs, bread and milk. Much to the disgust of our kids, when it comes to managing rising food costs, putting balanced and affordable meals on the table is what keeps the family running – not expensive packets of chips and biscuits! In business it is also helpful to remember the ‘staple’ roles, processes, and tasks needed to keep a business afloat. It’s about focusing on the areas that make the most difference to the bottom line. 

The most obvious ‘business staple’ is marketing: without customers no amount of product wizardry or visionary strategy can keep a business afloat. As Peter Drucker famously said, ‘the purpose of a business is to create and keep a customer’.  A recession or economic downturn is not the time to stop investing in marketing to your customers – indeed there is an argument to increase investment.

However, it is also important to ensure the marketing that you do, is as effective as possible. Here’s my top 5 strategies and tactics for marketing efficacy: 

#1. Get to know your best customers.

Ensure you have a formula for ranking customer value (high to low) which at a minimum includes a financial / sales measure (recency, frequency, monetary), propensity to refer business, brand engagement and brand alignment. Relative value is the foundation for finding more high value customers and for ‘Dear John-ing’ customers that cost the business.

#2. Use targeted, measurable communications.

A communication that speaks directly to your best customers / prospects, rather than the mass market will generate better quality leads and more engagement. This is where digital communications come into their own with their ability to have a one-to-one conversation that is both personalised, relevant, and measurable. Of course, this needs to be driven from a robust, accurate customer database and sales pipeline.

#3. Business objectives should drive your marketing.

This sounds obvious but this first step in developing any marketing plan or communications is often overlooked. You must clarify the business objectives so you can formulate the right strategies and measure the impact they have. For example, if the business objective is to maintain profitability in a slowing economy, an appropriate marketing strategy may be to analyse the profitability of each product line and shelve or reconfigure those products with low margin and promote those with a high margin.

#4. Have a strategy for each customer segment.

We know that not all customers are equal, and it costs a lot less to retain existing customers than acquire new ones. Using your customer value model, you can decide which customers need to be nurtured, which can be grown, which should be maintained, and which should be exited. You can also assess your exposure to risk, if, for example you have a small group of customers that generate the bulk of your income.

#5. Use integrated technology.

You will get the best bang for you buck if your marketing software talks to your sales software and that talks to your operational software, which – you guessed it - needs to talk to your accounting software. This reduces errors and labour and often provides a better customer experience. If you are looking at your options ensure integration is at the top of your list, followed by scalability, automation features, user experience, security, stability, and platform (desktop vs cloud).

So now it’s over to you to have a look in your business pantry. What are your staple items and what are your luxury items? Which marketing efficacy tips resonate with you and what do you need to do to act on them? Why not start by taking our complimentary online marketing diagnostic (click here) or give Kirsty Grant a call on 09 430 4888.