“Sell more stuff” isn’t a marketing strategy – and won’t get the results you want

when marketing goals are hazy, results can't happen

when marketing goals are hazy, results can't happen

Marketing can’t deliver results if you don’t know what those results should be

The other day I had a conversation with a new client. He wants to grow his business aggressively (from $1.5 million to $5 million in revenue) in the next couple of years, and knows he needs marketing support to do it. But he hasn’t done a lot of marketing so far, and while he’s an expert in his field, he hasn’t had much experience in sales and marketing.

Here is part of our exchange:

ME: “Can you tell me a little more about your sales goals for the next 6-12 months?”

HIM: “I told you. I want to grow the business.”

ME: “Yes, but as we’ve discussed you’ve got a wide range of products and services. Which ones do you want to focus on?

HIM: “All of them. We need to sell more of everything.”

ME: “What does your business plan look like? Where do you see the bulk of your revenue coming from in the next 6-12 months?”

HIM: “We need to double our revenue by next year.”

ME: “Where do you see the incremental revenue coming from? What’s making you the most money right now?”

HIM: “Everything. We need to sell more of everything.”

ME: “But you said you didn’t want to spend more than $2500 a month, right?”

 

It’s hard to achieve goals if no one knows what they are

Many – maybe most – small businesses are afraid to get too specific with their sales and revenue goals: “If we concentrate too much on one area,” they fear, “we’ll miss opportunities in other areas.”

And it’s true that the nimbleness of small businesses – their ability to respond to changes in the marketplace and adapt their service offerings accordingly – can be a tremendous advantage.

However, when it comes to marketing, this strategy usually just results in chaos, overspending, and an inability to judge whether a particular marketing initiative has been effective.

Marketing isn’t like accounting. But you have to at least try to make the columns add up.

Look, I’ll be the first to admit that marketing is often more art than science – and even the science bit is often alchemy. It’s tough to draw a straight line from $1 spent on marketing to $5 in revenue.

Big-data types can talk all they want about profiles and predictive modeling and one-to-one targeting, but until they figure out that I don’t actually live in Ottawa and that I am not interested in hiring a painting contractor in Virginia and that I am definitely not buying anything from Zulily, I am going to continue to believe that successful marketing consists of gathering all the information you can, then making some choices.

6 steps to setting marketing goals that are more likely to get results

1. Pull your actual sales data so you know exactly what you sold. Anecdotal sales stories about that one time you sold a whole bunch of random stuff to that healthcare center in Boston aren’t good enough. Most of the time, your sales data will tell you that, in fact, your best, easiest sales are of your top 3-4 product/services.

2. Figure out what’s driving customer acquisition. This is, in my experience, the biggest unknown for small businesses – and yet it can be the greatest source of information for marketing purposes. If 90% of your customers are referrals from other customers, then you should probably use marketing to encourage more referrals, instead of spending a zillion dollars on a fancy website that no one visits anyway.

3. Segment your customers. Again, stop relying on anecdotal information and look at the list of people/businesses who’ve actually bought stuff from you in the past 12-24 months. You’ll almost always discover that 85% (or more) of them fall into 2-3 easily identifiable categories (same industry, same function, same location, etc.).

4. Identify your high-margin products/services. It’s (usually) more profitable to sell $50k worth of stuff at a 50% margin than $200k of stuff at a 5% margin. So why focus marketing efforts on both?

5. Articulate the business goals – and be specific. Yeah, okay, you want to sell more stuff. But why? And what? Maybe you want to drive gross revenue because you’re looking at an exit strategy; maybe you want big profits because you want to give your employees a raise; maybe you want to push a monthly service because you want to stabilize cashflow; maybe you want to build the brand to attract investors. The more you know about your business goals, the better you’ll be able to determine what your marketing should focus on, how much to spend – and what marketing tactics will get you there.

6. Go after the low-hanging fruit first. Seems obvious, right?  Except, like I said, most small business owners fear that if they focus on the obvious, they’ll miss out on the mystical unicorns of untapped customers. But here’s the thing: I promise that if you spend 12 months focusing on the low-hanging fruit, the mystical unicorns will magically appear. Business is funny that way: The more successful you are selling your core products and services to your core target markets, the more likely it is that you’ll start selling to everyone else, too. Plus, you’ll be so profitable that you won’t have to go chasing unicorns any more!

 

I know, I know – all this talk of business analysis and goal setting means I’m taking all the fun out of marketing, which is supposed to be about Big Ideas and cool websites and getting a YouTube celebrity to endorse your product. It can be like that – as long as you’ve done your homework first.