Business owners always ask me how big their marketing budgets should be. I usually reply that a successful marketing campaign does not depend on how much money you spend, but how well you spend what you have.
If you want to make good decisions about how much money to spend on marketing (and more importantly where and when to spend), you should begin with a business analysis. Ask yourself:
- How many existing clients do you have?
- How many new ones do you want to add?
- In what time period?
- What is an individual customer worth?
If you have a solid base of existing clients, marketing funds directed toward loyalty, repurchase incentives and referral programs will be important. If you hope to expand your client list, acquisition activities such as cold calling, direct mail or even advertising might need to be in your budget.
Regardless of your objective, successful marketing is not just a slick campaign, but a well thought-out strategy which brings together the 3Ms: Market, Message and Media
Market:It doesn’t matter how big your business is, you cannot sell to everyone. Even if you could reach the entire population, the reality is some people are more likely to buy than others. So begin by focusing on a segment of the market. Select a profitable niche and exceed their expectations. Instead of trying to reach every household in their community, a small café grew their business by promoting their location as a haven for moms, a place to come with your friends when the kids are in school. Hosting book clubs, discussion groups and non-profit boards filled the tiny café daily.
Message:Now that you have identified your customer, what do you say to get their attention? Think about what is important to your customer, what keeps them up at night. Craft a message which addresses their concerns, not what you want to sell. I once had a financial planner tell me what his customer wanted choices. I had a hard time imagining many consumers laying awake at night worrying about not having enough choices. This was an important element to him, but not his clients. What really kept his clients awake were worries about retirement and college tuition. My advice to him was to stop talking about choices until you have their attention!
Media:In marketing, it is not just what you say, but where you say it. Ask yourself: Where are your customers going for information? Select your media based on its ability to reach a large concentration of your target. It doesn’t matter if the newspaper has cheap ads if your target is consuming their news online.
Once your 3Ms are in alignment, you are ready to start spending money. Go out and spend well!
About the Guest Author
As Creative Director, Lorraine is typically at the center of the managed chaos that is Roundpeg. With more than thirty years as a marketing professional (lie, tell her she doesn’t look that old) Lorraine keeps Roundpeg popping with a never-ending stream of new ideas.
A native New Yorker, Lorraine is a Hoosier by choice, and is committed to fostering growth and entrepreneurship in her adopted city. Recognized by the Indianapolis Business Journal as one of the Most Influential Women in Indianapolis, she is an active member of the local Indianapolis business community.
When not at Roundpeg, Lorraine can be found sharing what she knows in seminars and presentations around the country. She has a BA from Queens College, City University of NY, and an MBA from the University of Texas at Dallas.
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