Posted by James Cooper
How to increase your marketing ROI by recording and reporting on quality information. Then selecting the best small business marketing techniques...
Marketing has got to be right at the top of the 'wish we could get better results list' for many small businesses and their MDs. News flash... marketing is about ROI (return on investment)! If your marketing techniques do not provide you with a return on your investment, they are crap!
For SMEs it is vital that marketing techniques deliver return on investment almost immediately, because without results in month 1, 2 or 3... you will not have any money to invest in further marketing. So, I ask you...
- What is your ROI from your marketing overall?
- What is your ROI from each of your individual marketing techniques?
- What is your acquisition cost per new client or sale overall?
- What is your acquisition cost per new client or sale for each individual marketing technique?
- What is your acquisition cost per new lead or enquiry overall?
- What is your acquisition cost per new lead or enquiry for each individual marketing technique?
Don't know the answers to these questions? ... Then how the heck can you expect to get better results? Magic beans won't help.
Hey, I understand it's tough... you're running a business, you're flat out as it is, you wear 5 different hats as it is. This is just another task to add to the to do list, or the nice to have list, right?
Well, no. It is now much much easier for small business to measure return on marketing investment. There is an army of savvy people and tools out there that solve this very issue. And that in turn will lead you to much better marketing results by selecting the best performing strategies and techniques. You see, what we are after is the right information.
Why Information is the Key
If you've been in business for more than a few years it's highly likely that you've heard the old saying.. "you can't manage what you don't measure". Now, most people nod their heads in agreement, but very few have all the information they need across all areas of the business. 'Knowledge is Power', another well known saying... for business owners and MDs quality (or the right) knowledge is the key to success. Quality knowledge comes from the right information.
The better the quality of the information, the better your knowledge is, the better your decisions are, the better your actions are, the better your results, the happier everyone in your team and life will be.
I found out a long time ago that if you want to deliver better performance in any area the easiest and first place to start is by recording and reporting on it. This instantly brings no bull facts to the table and draws the attention of everyone involved to deliver better results. This simple action alone has got to be my number 1 marketing or sales technique... Implement a Recording and Reporting System.
Small business marketing techniques
There is no magic list of small business marketing techniques which work for every small business wanting to get the maximum ROI. Each business should be unique and so you'll need to develop your own "[insert your company name] Marketing System" where you select the best strategies, tactics & techniques for your business. However, I'm not a huge fan of the typical marketing consultant / business coach or consultant default cover my butt speak like "well you have to test and measure". It makes me want to say... "Ummm, what about I take £20,000 or $20,000 from your bottom line net profit and tell you its all good because we are testing and measuring?"... This is mad, why don't we learn from others all around us that are doing well and thus we minimise the expense of 'test'. So... in this spirit, here are the top techniques I currently use myself and with clients to get RESULTS and max ROI;
- Marketing Fundamentals
- Positioning Statement and USP
- Lead Generation Offers (No Risk & High Value Offer that has the potential customer providing their contact details in exchange for something of value to them and permission to communicate with them)
- eBook
- Case Studies
- Kit
- Report
- Online Video
- Whitepaper
- Events
- Archived Webinars
- Live Seminars
- Live Webinars
- Experience Days / Evenings
- Lead Nurturing Offers (Engage the Lead in your content, company, and the experience your company/product/service is about so that they)
- As per lead generation offer types listed above.
- Outbound Marketing
- Direct Methods
- Direct to Target Market (Only to high value very targeted suspect list)
- Cold Calling
- Direct Mail
- Direct eMail
- Phone, eMail, Phone
- Phone, Mail, Phone
- Telemarketing
- Strategic Partners or Referral Partners (Only to those with high direct influence with your target market, or those able to directly provide plenty of repeat business)
- Cold Calling
- Specifically approach at Networking Event
- Mass Advertising Methods
- Public Relations
- Networking Events
- Inbound Marketing
- Website Enhancement
- Landing Pages and Conversion Pages
- SEO (Search Engine Optimisation)
- SEM (Search Engine Marketing)
- Blogging
- Social Media
- Permission Marketing
- Newsletter (eMail and/or Print)
- Direct Mail
- Direct eMail
WARNING! This list is almost worthless! That is, unless you do 3 vital things;
- IMPLEMENT it,
- Implement it well (there can be a world of difference between how you execute different campaigns using the same basic marketing technique, get it right or wrong...the results will show up in your ROI. You must use best practice to produce the best results), and
- have a Recording and Reporting System to see where to focus your limited resources (your time, your staffs time, your marketing budget).
Successful implementation is ALWAYS the hurdle that stops small businesses improving results with marketing, but one of the key ingredients to overcoming this hurdle is to have quality information and your eye focused on it. This comes by way of a recording and reporting system...
Setting up Recording & Reporting for Marketing Return on Investment (ROI)
You can do this using a range of methods to suit any budget and level of sophistication required;
- Paper base manual daily/weekly/monthly marketing & sales recording sheets. Then reporting sheet.
- Excel spreadsheet
- Accounting software
- CRM software
- Marketing software
What should you record & report?
- The Profit Funnel - # of Suspects/Visits, conversion rate 1, # of Leads, conversion rate 2, # of Opportunities, conversion rate 3, # of customers/sales, total value of customers/sales, average sale value, total gross profit, average gross profit per sale.
- Marketing ROI, Overall - direct revenue from marketing campaigns, direct gross profit from campaigns, marketing expense, ROI (gross profit - marketing expense), ROI%, acquisition cost per lead, acquisition cost per opportunity, acquisition cost per sale.
- Marketing ROI, Tactic 1 - direct revenue from marketing campaigns in tactic 1, direct gross profit from campaigns in tactic 1, tactic 1 marketing expense, tactics 1 ROI (gross profit - marketing expense), ROI%, tactic 1 acquisition cost per lead, tactic 1 acquisition cost per opportunity, tactic 1 acquisition cost per sale.
- Marketing ROI, Tactic 2 - etc
Action Points
All of this above is just a part of what makes up what should be a clear map or system for how you conduct your marketing, an Integrated Marketing & Sales System. But, if you start with this simple tactic... start recording and reporting on your marketing information, you'll get better results immediately!
Posted by James Cooper
Making Business Systematization Initiatives Stick
How to ensure that your efforts to systematize your business (so that it is more self sustaining and automated to be less reliant on you) don't fade...
Phase 6, the last phase of the mimosaPLANETTMSystematization Process is; Making it Happen. This is completely about making sure that this systematization process is not just a one or two week initiative. It is about putting in place a structure that will see it through to completion of a first run through the entire process and place value on business development in perpetuity. This is where I have seen countless business owners get frustrated. Learn how to keep the momentum going, momentum that leads to critical mass, critical mass that supports change and produces results...
What are the strategies used in this Phase?
The Making it Happen phase is all to do with taking action or activity... but the key point to remember is activity must be justified, it must be worthwhile... activity for activity sake leads you and your team to doing pointless tasks or doing the tasks that are unimportant first and leaving the truly important tasks that aren't urgent never to be completed. To make sure activity and busyness is worthwhile we must do two vital things .... Record & Report! We must highlight the Key Performance Indicators (KPIs) for each area (and/or role) in your business. If you and your team then know what it is that truly matters, and these KPIs are recorded and reported on, you and your team will instantly find your activity and behavior (the decisions and actions) you take on a daily basis will instantly be more effective.
Once you and your team have a good understanding of what is important (the KPIs), then you can set a course of action to improve them, ‘action' points or ‘doing' points if you like. Below are the basic strategies I recommend that will yield fast results in the short term and... continued growth & automation (business systematization so you as the business owners aren't needed as much) in the long term. This long term (by long-term why not 6mths or 12mths instead of 5 years, what's stopping you?) automation goal comes about only if a regular schedule is adhered to, too many business owners will set weekly development meetings, they happen once or twice then two people are away the next week so it doesn't happen, then the week after "we are busy and have no time"... or some other lame excuse (admittedly, excuses that I've in the past used). The point is when something is set as just part of the routine, like dinner ... it always happens!!! While we are on meetings...the second point to make is; meetings don't work! Huh, meetings are crap time wasters... well they are for most people unless you and everyone in that meeting leaves with a clear list of decisions, and actions points to be achieved by who & by when.... Oh, then it's vital they actually do them and are held to account at the next meeting. Here are those strategies in phase 6;
6) MAKING IT HAPPEN
The Basics
- Weekly Role Based KPI Dashboard (Activity and Results)
- Weekly Team Business Development Meetings (Not WIP (Work In Progress) Meetings)
- Monthly KPI Reports (Executive KPIs, Marketing KPIs, Sales KPIs, Operations KPIs, Finance KPIs, HR KPIs)
- Monthly Directors Meetings (KPI Target vs Actual review, Actions as a Result of)
More ...
- Quarterly KPI Reports & Individual Evaluations
- Quarterly 2 Page "DOING" Plan (KPI Targets, Strategy Selection)
- Yearly Plan (Directions, Goal, KPI Targets, Quarterly Milestones, Initiatives/Projects)
For KPI examples see Record & Report
It's that simple...
It's too easy to over complicate things, so keep it simple...
"Everyone, here's a visual representation of our team, it's called an organizational chart.... Bob this is you, and these are the two points that are important in your role, they are called key performance indicators or KPIs, they let you and everyone else know if you are doing a good job, a crappy job, or an excellent job . If we focus on making sure you all improve your specific KPIs we can all have a lot more fun. Here's an example of one of Bob's KPIs.... This is what we are going to do to improve results in this area...."
There are much better methods to ‘train' people, than telling, but the above statement is the basic message you want to get across. Better training methods include asking specific questions to get them to come up with the answer rather than just telling them... which doesn't get your team to use their own brain.... Oh, this is a huge point, if you tell your team how to do everything, how can you EVER expect your business to be systematized?! To automate your business so that it runs without you, you must setup systems and empower your team to make decisions by trusting them, mistakes cost way less than you might think to fix.
This week's Action Points...
The key is one; your belief and resolve, and two; the schedule.... I talk with clients weekly at the same time, we finish with a list of action points... we move forward. Set a schedule for your internal report completion and for meetings... then stick with it!
Posted by James Cooper
How Do You Know How Well; People, Processes, Departments, & Everything In Your Business... Are Performing?
Find out how you can take an ‘R&R' approach to your business and reduce its reliance on you dramatically!
"And just how can ‘R&R' get me there", I hear you mutter. Well, stop thinking Rest & Recuperation, and start thinking Record & Report!
In Part 3 of 4, of systems, we learn how Recording & Reporting gives you huge gains toward a more self reliant business and a less ‘you' dependant business. Plus you'll learn the top 2 things you should be recording right now and how to get started right away...
Why have you missed the boat in the ‘Information Age'? ... Where's your information?
Knowledge is power. You can't manager what you don't measure. If you don't know the numbers how can you improve the numbers? .... I'll tell you what, I'm sick of repeating these well known phrases. Why? Well, I truly believe 99% of people understand and agree with the logic behind having access to and understanding what is performing well, and what is not, so you can affect change for better results. I mean, the more accurate the information you have, the better decisions you can make, right? ... I don't think anyone would argue with that fact. So what is missing? Why, do equally about 99% of business owners, not arm themselves with the tools, I repeat ‘the tools', to truly know what the hell is going on in their business!
I've got a theory and you may not like it...
It's not, "I just don't have time for that sort of stuff, I'm just too busy". That is bull! We are all busy, absolutely, even next week on holiday I'll be busy, at the beach slowly reading a book, I'll be busy. The point is we all get to CHOOSE how we allocate our time... time to what activity. How do we make that choice?... It's based on what activities you value the most, what activities you believe will get you the results you're after, and for some of you it's also based on your skills and/or habits. If that's the case, you understand Recording & Reporting in your business is important and would be of value, but you choose not to create and implement Recording & Reporting systems and processes because... why... well, you simply don't value it enough to do it!
Start realising the true value....
We are not reporting just for the information to help you know what's going on. We are reporting so that everyone in your team knows if they personally are doing a great job at each of the tasks that make up what they do. We are also reporting to increase the understanding of how those results of each tasks impact on everyone else in the business and what steps we can take to improve performance in each of those tasks. You see, take the subjective ‘are we doing well feeling' out and replace it with ‘hard tangible facts'!
Facts let you, and everyone in your team, know whether or not each area is performing or not. Consider this... you own a business with eight (mainly operations or admin based) staff, where you personally as the owner also wear the Marketing Manager and Sales Manager hats on top of the General Managers hat. Now consider if you were to keep only the General Managers hat and you replaced yourself as the Marketing Manager & Sales Manager with a new employee in charge of both roles. This is the million dollar question... "How do you know if that person is doing their job/role a) as expected, b) badly, or c) excellently?"
The only way to know is not, "more sales and more profit (money)", yes maybe, but to truly step away from the business, an owner and each team member must understand what key indicators lead to the desired result. It is not higher Sales that is the key indicator of success for a marketing manager (yes Sales is the result, and the result we strive for), but the true indicator, that in turn can lead to more sales, is in fact the number of enquiries or leads or opportunities to make a sale.
If you want to get leverage in your life, you need systems. Great systems come from great business processes. But if you come up with the greatest system and business process in the world it will still need human input at some stage. In order for someone to truly perform they need to understand what is a good result, a bad result, and a great result. To do this we need to 1) RECORD vital information and 2) REPORT on a regular schedule of communication in a simple manner so we can TUNE / TRAIN / IMPROVE the system or the person.
Here what you should be Recording & Reporting on?
1) Monthly Directors Financial Report:
I always recommend reviewing the following Financial Statements on a monthly basis;
- i)The overall tread over the last year by looking at a Multi-Period Profit & Loss (Statement of Financial Performance) Spreadsheet (i.e. Oct'06-Sep'07).
- ii)Last Year's Month (i.e. Sep'06) against This Current Past Month directly (i.e. Sep'07) (or Last Year's Quarter (i.e. Jul/Aug/Sep'06) vs Current Past Quarter (i.e. Jul/Aug/Sep'07), as some businesses will fluctuate their purchases from month to month and depending on recording methods Quarterly reviews can smooth this out for reviewing).
- iii)Multi-Period Balance Sheet Spreadsheet (Statement of Financial Performance)
2) Monthly {Role Specific} KPI (Key Performance Indicator) Report:
This following KPIs could be slightly different of course depending on industry, but it's a good place to start...
-
i) General Manager: Net Profit $, Net Profit Margin %, Gross Profit Margin %, Gross Profit $. Shareholders Value.
-
ii) Marketing Manager: New Enquiries/Leads/Opportunities to make a sale. Lead Acquisition Cost. Campaign Return on Investment. Returning/repeat Business.
-
iii) Sales Manager: Conversion Rates from Enquiry to Lead, From Lead to Opportunity, From Opportunity to Sale. Average Sale Value.
-
iv) Operations Manager: Quantity Measure vs Quality Measure, Inventory Days, Work In Progress Days. Budget vs Actual Billable Hours, Budget vs Actual Widget produced. Customer complaints.
-
v) Finance Manager: Accounts Receivable Average Days. Government Compliance On Time. Net Assets. Bank Account Balance. Accounts Payable Days.
-
vi) Human Resources Manager: Staff turnover rate. Return on training.
Don't hide from the facts, take the no bull approach to business, recording and reporting can be easily done today with the addition of technology, or through your current resources both in-house (the resident MS Excel/IT person) and out sourced (Accountants, Coaches, etc).
If you don't create a system that captures the key information about whether or not each job (role/task) is being done well or not, you will always be needed in your business. If you find yourself saying "the business always needs me, I'm the only one who knows how to do everything", then think.... is this phase really serving me well... or am I serving my ego! .... STOP, think about it!
This week's action points...
If you really don't want to say that phase anymore, start by getting your team to write out there KPIs, plus what is a good, bad and great result for each KPI.
Posted by James Cooper
Boosting Your Profits... 
At the end of watching your favourite sporting match, what is the one thing that is left in your mind; maybe for days, weeks, months, even years for some? Why, it's the result of course. If there is one thing you are likely to remember, it has got to be who won the game, right? Now...just picture this...Fast forward a little over 2 months from now, it's October the 21st, early on a Sunday morning you and the rest of the nation are watching the All Blacks play France in the Rugby World Cup Final (actual teams may vary). The match is a cliff hanger, it's an electric 26 all with 3 minutes to go, in the final stages the All Blacks build momentum and move to within 10 metres of the French Try line, surely they must score! The pass is thrown wide, to an unmarked Jerry Collins only 5 metres from All Black glory, his eyes widen, his heart races...he drops the ball. The All Blacks lose from a drop goal by the French in injury time.
What is remembered most? The final last minute handling error by one of the Cups consistently best players and of course the result, a loss. But wise players and spectators alike know that the result cannot be solely blamed on the one final error, in fact go a step further and ask someone who had not seen the game why they lost and they just wouldn't have a clue without more information.
In business, it is the same, just looking at the result, a win (a profit increase), a loss (a profit decrease), or the score 26 - 29 (profit amount vs budgeted or last year's amount [because you are really playing against yourself in business]), won't tell you how to massively improve. Sure getting stuck into your Yearly or Monthly Financials is vital to know how the score came about (Sales, COGS, Gross Profit, Expenses, Net Profit), and it gives you some great insight into what has happened and what could be done to improve. Just like knowing the score breakdown of Penalties, Tries, Conversions, and Drop Goals in a rugby match. But the real power to effect massive change is to know the other stats, like Possession, Territory, Lineouts, Scrums, Rucks, Mauls, Hitups, Linebreaks, Tackles, Turnovers, Errors, Penalties conceded.
Do you know what the Pre Key Performance Indicators are in your business?
This is by far the fastest, easiest and simplest way to increase your profits, just start recording and reporting (R&R) the number of occurrences on each of your activities (or steps) that lead towards getting a sale from an enquiry, on a daily, weekly and monthly bases. Doing this alone, and nothing else, will increase your results...why? Because now you're focusing on it, you know that you are recording you and your teams' activity in this area. You see, if you had to employ someone to be the sales manager in your business, how would you know if they were doing an good, bad or ok job. By using a Daily Sales Activity Report! Ok, so you could argue that increased sales or revenue is the ultimate score card, and yeah you are right, but if you're still reading this article it was likely that the headline drew you in, so you're looking to improve sales and if that is the case...by using the Daily Sales Activity Report we can assess what lead us to get that many sales and where the areas of opportunity lie so we can focus on them to improve.
So what sort of activities do you record?
This does depend on your business, do you prospect for business with phone calls? Do you get lots of phone calls requesting a quote? Do you tender? Is it repeat customers? Etc, etc . Simply flowchart the steps a customer goes through to purchase something off you (and / or) flowchart the steps you go through to find and make a sale to a prospect. Then open a excel spreadsheet (or create a hand written one if you like) write down the steps in the rows and in the next column have a tally box to record and in the next, a total box, simple! Example 1: # of Phone Enquiries, # of Onsite Quotes Booked, # of Onsite Quotes Attended, # of Proposals Sent, # of Call Backs, # of New Jobs Booked.
Start thinking of the Daily Sales Activity Report as a way you can really affect the bottom line profit in your company, because your conversion rate from Enquiry to Sale is probably not nearly as high as you might think, all enquiries/questions are opportunities. By recording and reporting on it you will consciously have it staring you in the face and if you are getting 10 enquiries a day, a week, an hour, you will want to ensure you do everything you can to maximise these opportunities, by improving your conversion rate to help people get what they need. If you had a conversion rate of 4 out of 10 (40%) and just increased it to 5 out of 10 by doing this simple strategy alone (R&R) you would increase your Gross Profit by 25%, without spending a cent on marketing or advertising. Have I got your attention now! Wouldn't the All Blacks be proud.
This week's action points...
Take out your Sales Process Flowchart from last week, because I know you did that right? Jump on the computer and into excel or word and create a Daily Sales Activity Report. Print out a week's worth, place on a clipboard and start recording. I realise "Creating" is the hard part, so better yet email me and I'll send you a template where 80% is done for you.
