As 2010 draws to a close, it’s time to finalize your marketing plan and budget for 2011. For next year, wouldn’t it be great to save money on your marketing efforts while not reducing their effectiveness?
I’ve found that almost every marketing budget carries some unneeded fat. An easy way to increase profitability is to make cuts where they won’t hurt.
Follow these four steps to cut costs, not effectiveness:
- Make a list of all marketing activities your business undertakes in a year: trade shows, public relations, advertising, sales trips, customer service training, etc.
- Write down how much money you spent on each item in the last year.
- Now write down how much revenue you can attribute to each activity.
- Do more of those activities that made money and less of those that lose money. Usually, this step is harder than it seems because our marketing plans are full of activities that we do from habit or to satisfy certain people in our businesses. But, for instance, if you lost money on trade shows, you shouldn’t keep investing in them, regardless of a perceived loss of reputation or “getting your name out there.”
This four-step process is simple, if you’re able to track the results of your marketing efforts. But do you have difficulty attributing revenue to each item? Here are some tips to track the effectiveness of your marketing channels in the future.
- Unique toll-free numbers. There are services available to provide different toll-free numbers and track the calls you receive from each. Assign a different number to each advertising channel: radio, print and web. For more granularity, assign a different number to each campaign type.
- Website analytics. If you haven’t already, install Google’s free Analytics on your web site. You can track the effectiveness of your pay per click advertising, other sites referring to your site, search terms visitors use to find your site, the geographical location of visitors and more.
- Ask your advertisers. Advertisers should be able to provide results from your campaigns. Ask them about it.
- Coupon codes. For any special offer you provide customers, use a unique coupon code you can use to track redemptions.
- Lead tracking. When you record a new contact, track where the lead came from. Usually people don’t mind being asked, “How did you hear about us?” Store this information on a spreadsheet, contact application or lead manager like salesforce.com.
Some marketing efforts don’t have a clear return on investment, like training your receptionist to help customers find information or encouraging your sales staff to develop better relationships with customers. Fortunately, most efforts that have an unclear ROI also cost the least. And personal interactions have the biggest impact with your customers because customers will remember a phone call with a member of your team more than they will remember an advertisement they saw in the newspaper. When planning your marketing budget for 2011, cut costs, not effectiveness and promote interactions over impressions.