Stop competing on price! Learn how to combat commoditization — exemplified by the Makino’s effect on the manufacturing industry.
How to maximize your marketing budget (whatever it is)
At Kinesis, we work with businesses of many shapes, sizes, and growth stages. Some have humble beginnings with modest goals (such as steady 10 percent growth each year), while another just achieved their insanely-aggressive goal of nearly 1,000 percent year-over-year growth.
But perhaps the most important question is one that faces not just marketing, but every business unit: Whatever my budget, how do I maximize return on investment?
While there is no one-size-fits all, we’ve identified some common truths about creating a marketing budget. Below is our easy-to-understand guide to help you make the most of your marketing budget (regardless of how big it is).
How to maximize ROI with almost no marketing budget
In the early stages of a company’s growth, many businesses have not allocated a formal marketing budget (most companies at this phase of development have "hidden" marketing costs that aren't seen on the P&L, but are incurred through DIY efforts by staff and owners). These companies typically fall into one or more of these buckets:
- Generate less than $2mm in annual sales
- Focus more on maintaining the status quo or organic, slow growth
- Do not have the experience in planning and budgeting for marketing and simply “do marketing” as it comes up.
Jump-start your marketing efforts
Your motto: Pluck the low-hanging fruit. Even with little-to-no marketing budget, there are some bare-bones basics you can implement. These are building blocks that will help you scale your marketing efforts, lead generation, and sales.
- Implement a Customer Relationship Management (CRM) software: This is an important first step in tracking your leads and new customers (and where they’re being generated), as well as any trends related to your sales funnel. At Kinesis, we use Base CRM — but there are many options available depending on your needs.
- Improve your customer experience: This probably sounds like a no-brainer — but did you know that by reducing client defections by just 5%, you can increase profitability by up to 95%? Find opportunities to enhance relationships with existing customers to boost retention. (Not sure where to start? Create a customer satisfaction survey using a free tool like SurveyMonkey to determine areas that need improvement.)
- Develop a referral program: Note that this comes after improving your customer experience — don’t go asking unhappy customers for referrals! Once your client relationships are shored up, word-of-mouth marketing is an inexpensive way to grow your business. Ask your existing clients, vendors, partners, and friends whether they know anyone who could benefit from your services. Consider utilizing a reward system to recognize and encourage referrers. Track referrers and referrals in your CRM.
- Network: Event marketing — such as trade shows, conferences, or general networking — can quickly get your business in front of people and generate new leads. If possible, try to obtain an attendee list ahead of time and plan who you’d like to connect with. Be sure to have updated business cards and a follow-up strategy in place.
- Build out your LinkedIn presence: Linkedin is a powerful social platform for making business connections. Start by developing your company LinkedIn page, then move onto the profiles of your team. Then, work to grow your company’s network on LinkedIn, and boost visibility with regular updates such as links to relevant articles or industry publications.
How to maximize ROI on a modest marketing budget
Perhaps your company has just recently decided to make marketing a formal function of the business — and you’re operating with an exciting (but modest) budget. Congratulations! This is a major milestone for any small business, and it opens the door to immense possibility. The US Small Business Administration considers an allocation of 3–5 percent to be typical in this phase. These companies usually:
- Generate between $2–$5mm in annual sales
- Have conservative-to-moderate growth goals
- Are starting to make marketing a higher priority, as part of an overall growth strategy
Propel your marketing forward
Your motto: Aim for medium effort, high impact. Even with a minimal investment in certain marketing activities, your business will be well-positioned for sustainable growth. In turn, you can expect a reliable stream of incoming leads. Leverage your marketing efforts to establish brand presence, grow exposure, and nurture long-term relationships with prospects and clients.
- Build a memorable and engaging brand: This means more than just a new logo — it means identifying who you are as a company, articulating your remarkability, and shouting it from the rooftops in a meaningful and strategic way. An important aspect of this is crafting a cohesive brand story, tailoring messaging to your unique audience, and enhancing your overall visual identity: the look and feel of both printed and digital assets, with well-defined brand standards for your color palette, fonts, styles, and photography.
- Invest in a good website: Your website should act as your brand’s online hub, and your company’s only 24-hour salesperson. A good website is easy to navigate, and leads users down an intentional path — introducing your business, educating them about your services, and inspiring them to take action. A great website is also optimized for search engines, designed well, and built to showcase your expertise with your brand story, case studies, a blog, or downloadable resources.
- Develop an email-marketing plan: Email marketing is a straightforward and effective way to stay in front of your network, and to keep your business top-of-mind for clients, prospects, and referrers. Build a plan that lands you in inboxes no less than once a month, and send relevant valuable content to your list (like blog posts, industry articles, or other resources).
- Elevate your sales and marketing materials: Increased marketing sophistication is also a great opportunity to align sales and marketing messaging — which can include the tools your sales team brings with them to prospect appointments. Fill that toolbox with a well-written value proposition and persuasive leave-behinds.
How to maximize ROI on a robust marketing budget
Perhaps you’re farther along the maturity curve and ready to take your marketing budget and systems to the next level. Bravo! Smart investments in long-term marketing strategies can be the catalyst for profound business growth, and you’re already well on your way. In this phase, companies often allocate 5–11 percent of gross revenues to marketing, and generally:
- Generate more than $5mm in annual sales
- Have aggressive three-to-five-year growth goals
- Commit to sophisticated, systematized marketing efforts with KPI measurements in place
Take your marketing to the moon
Your motto: Amplify the brand and gain market share. At this level, you are focused on both inbound marketing (wherein your vast reputation and expertise draw people to your door), as well as outbound strategies (direct marketing outreach to prospects).
- Become a thought leader: Thought leadership is the art of positioning your company as an authority in your field — a trusted source for innovative ideas and subject matter expertise. Content is one way to achieve this — through activities such as posting articles to your own blog, of course, but also being featured in external publications, creating a library of downloadable assets on your website, or even writing a book. You can also showcase your expertise by hosting workshops or webinars, or speaking at industry events.
- Execute lead-generation campaigns: Broadly speaking, lead generation is the act of getting in front of potential buyers and enticing them to do business with you. This could be through a particular offer, asset, or value-add, and through a number of channels including email, direct mail, or advertising. Done right, campaigns incorporate several different channels with the intent of maximizing customer touchpoints, increasing the likelihood of conversion.
- Implement marketing automation: A broad array of software is available to businesses seeking to elevate and automate their marketing program — giving companies visibility into website user or subscriber behavior, A/B testing calls-to-action, and more. For those with more vigorous marketing activity goals (such as complex list segmentation, multiple campaigns, conditional outreach logic, etc.), marketing automation can enable more efficient communication and a wealth of intelligence about your customers.
- Explore diverse mediums: The right marketing resources can also make way for interesting new media such as video or interactive digital, which are often a greater investment upfront, but tend to have higher engagement levels, and provide a reusable marketing asset to leverage in a variety of ways.
Define, execute, and measure, measure, measure
While not all strategies on this list will be a perfect fit for all businesses and budget sizes, one recommendation rings true for all: Be vigilant about tracking progress and monitoring the success of all initiatives. If something doesn’t work, change it. If something does work, try to figure out why and consider how to magnify it. Experiment, measure KPIs, and reassess regularly… and get ready for marketing to turn from a tactical afterthought into an engine for growth.
At Kinesis, we’ve helped many companies get clarity on the best way to deploy marketing dollars. Some have become Kinesis clients, but our #1 focus is providing help and value to our fellow businesses. To learn more about what marketing solutions might be right for you, drop us a line! We’re happy to point you in the right direction.