Do You Have a Marketing Plan? For many firms, the answer is no. According to a study by Marketo, slightly more than one-third of small businesses polled don’t have a marketing plan.
Many business owners and managers view marketing as a “luxury” … something to be done when things are going well. They perceive marketing as a cost rather than an investment. This stems from their inability to see immediate returns for their marketing expenditures.
So …why should a business have a marketing plan? What are the benefits of having such a plan and can it make a difference?
The Value of a Marketing Growth Plan
“If you fail to plan, you are planning to fail!” – Benjamin Franklin
It is not unusual to hear small business owners say they don’t do marketing because they get most of their business through referrals. And while referrals are a great source of new business, there is little control over when they come in. Despite the reliance on referrals and claims they are not marketers, small business owners still build websites, meet with people, pass out business cards, develop new products, make pricing decisions and seek ways to improve the experience they deliver to customers. These things are often done independently of one another and often don’t have any metrics or measures to determine if they are working or not.
Clearly, the term “Marketing” has an image problem. It is misunderstood by many and this contributes to a generally negative image. If we were to substitute the term “growth” for “marketing” it might gain greater acceptance and appreciation. For the purposes of this discussion, we will refer to a “marketing plan” as a “growth plan” because the bottom line for successful marketing is to grow the business.
There are many choices business owners can make to grow their business. In a resource-constrained environment, the challenge is to make the most cost-effective choices. A growth plan is a documented road map of data-driven, strategic and tactical choices with clearly defined metrics and measures to determine campaign impacts. This distinguishes a formalized plan from an ad hoc, seat of the pants “throw a lot of mud on the wall and see what sticks” approach. A killer growth plan is:
Build Your Plan on Data Not on Instinct
“Most of the world will make decisions by either guessing or using their gut. They will be either lucky or wrong.”- Suhail Doshi, CEO, Mixpanel
On the popular cable TV show, Bar Rescue, struggling bars are given advice and a solid plan to turn their business around, all in a one hour program. The show’s host, John Taffer is an expert, who has “rescued” hundreds of bars over the course of his career. He could easily rely on his intuition, experience and “gut feel” to develop strategies and tactics. However, Taffer also relies heavily on internal and external data to develop a customized rescue plan.
Like John Taffer, you should also use internal and external data to build your growth plan. But what is internal and external data and where do you get it?
Internal Data Sources for Growth Planning
Internal data is data that is compiled and collected from inside your company that can be used in decision making to improve your operations. Internal data sources include:
- Accounting – Sales, cost and cash flows.
- Operations – Production, shipments, inventory, customer satisfaction ratings, service levels.
- Sales Force – customer reactions, competitive threats, sales by channel, price point, profit margin, geographic area, customer type, and salesperson.
- Marketing – lead generation, lead sources, web traffic, inbound call rates, social media activity, customer demographics, psychographics and buying behaviors.
Your internal customer data provides real-time insights about who your existing customers are in terms of:
- Long-term customers (Tenure, Satisfaction)
- Who buys (Demographics, Psychographics)
- What they are buying from you (Products, services)
- Where they are buying (Online, brick and mortar)
- Which marketing appeals had the most/least impact
- Your most effective sales channel(s) (Click, Call, Face)
- Their most frequently asked questions
Internal data is valuable because you own it and it is free. Successful businesses recognize this and are adopting Customer Relationship Management (CRM) systems to manage the data and keep it in a central repository where all members of the sales and marketing team can keep track of the company’s activities.
More importantly, internal data shows your strengths and weaknesses. It is easy to know what you are good at; however, businesses may minimize or refuse to acknowledge their weaknesses. Internal data can objectively point you to where improvements are needed.
External Data Sources for Marketing Planning
External data is data that comes from outside your organization. It helps you to better understand the size of the market, your share of the market and your competitors. External data sources are useful in assessing:
- Demographic/socio-cultural forces
- Political and legal forces
- Competitive forces
- Science/technology factors
Because external data comes from outside your organization, you have little to no control over what is collected and how it is reported. It requires some time and effort to determine which data is relevant and applicable to you. Fortunately, there is a ton of “free” external data from Federal, State and Local sources that can be used for marketing planning.
Data-driven decision making is essential in a hyper-competitive business environment. Applying your intuition and experience to analyze and interpret the data results in fact-based decisions that are tailored to your business situation.
Your Plan Must Be Actionable
“Vision Without Execution is Hallucination” – Thomas Edison
An “actionable” growth plan lays out:
- Who the actions will be focused on (target markets),
- What the actions are (inbound or outbound), and what they are expected to accomplish (specific goals)
- When the actions will occur (dates of execution)
- Where the actions will take place (social media platforms, geographic areas, etc.)
- How much each action is expected to cost (budget)
It is critical that everyone in the organization is aware of and familiar with the growth plan, especially customer-facing employees and support staff. It is a mistake for the organization to assume that sales and marketing functions have sole responsibility for growing the business.
Ultimately, the degree to which the plan is successful is a function of the discipline used in its execution. Without enterprise-wide commitment and discipline to executing the plan the likelihood of success will be compromised.
“The greatest danger in times of turbulence is not the turbulence—it is to act with yesterday’s logic.”- Peter Drucker
One of the constants in business is change. Therefore, in executing your plan you must be flexible and prepared to accommodate unanticipated changes in the marketplace. Let’s face it, stuff happens and new developments could occur that renders some planned action items irrelevant and the need to make changes or adjustments. Even though the growth plan is documented on paper, it is not written in stone.
This does not mean that every new change leads to a new tactic. Instead, this is where a growth plan serves as a decision-making filter to compare alternatives, judge trade-offs and decide on the best approach. If and when new developments occur and a new action appears warranted, you can refer to the plan and make an informed choice about it. The new action should yield equal or better results than what it has replaced, otherwise, the plan remains unchanged. This approach brings discipline to what can be an emotionally driven response to new developments in the marketplace.
“What gets measured, gets done” – Peter Drucker
A key component of a growth plan are its goals and objectives. During the year, you measure progress to determine where you are having an impact. Key marketing metrics include:
- Number of qualified leads generated
- Number of comments generated by social media marketing tactics
- Amount of content shared
- Customer acquisition cost
- Conversion Rate
- Return on investment
Key sales metrics include:
- Time spent selling
- Lead response time
- Marketing collateral usage
- Sales closing rates
- Average deal size
- Sales volume by location channel or territory
Sales and marketing managers must meet regularly to review results and determine what is working and not working in the plan. Corrective actions can then be taken to ensure that the growth plan goals are being met.
A killer growth plan provides a level of control over the success of your business that cannot be achieved by simply relying on referrals alone. It is built on a set of data-driven actions that are continuously measured and monitored. Sales and marketing managers must be flexible in their approach to the marketplace and use the growth plan as a tool to guide their decision making when addressing changes in the marketplace.
While it is unrealistic to expect to complete 100% of your growth plan, a commitment and discipline in executing the growth plan is essential for its success. This is more likely to happen when the entire organization is aware of the plan and understands that everyone has a stake in growing the business.
What are your thoughts on having a marketing/growth plan? Are they effective, what other ways can they be improved? We look forward to reading your feedback and perspectives, via comments below, or let’s connect on LinkedIn for further discussion.
gL Marketing Consultants develops inbound and outbound marketing plans and specializes in digital marketing strategy development, implementation.