Marketing advice for SMEs – 4 questions you should answer to kickstart your campaigns
They say advice is often hard to come by. But not in the world of marketing. Here’s 4 questions you should be asking before you even consider doing any marketing.
They say advice is often hard to come by. But not in the world of marketing.
Head over to Google; after you’ve read this or in a new tab, type in “marketing for small businesses”. Abracadabra, 2,600,000,000 results popped up with Ads and suggested questions. Booyah! Could these search results mean this is the world’s shortest blog?
Because I’m about to go a little more specific. As many marketing and creative agencies will tell you, “we have a diverse range of clients”. I’d say 50% though have come to us with two things.
- Strong growth in the last few years due to having a great product/service, with a turnover of circa £1,000,000
- No marketing function/person in-house
The first statement I usually hear is, “we’ve never done anything like this before but know that now is the time to invest in marketing”.
And do you know what my reply is to that? You’re about to find out.
Here are my four questions that you need to ask yourself before starting any marketing.
Question 1: Do you have a business plan?
Yes, a business plan (sing it like the Muffin Man song if you want). It’s a serious question that requires two things. 1. A serious answer, and 2. An actual business plan.
But why does your marketing need to tie into it?
You can have THE best looking creative, photography and digital campaign in THE WORLD. If it isn’t aligned to the goals of your business, well, it’s not going to work like it should do or say what it needs to.
When your marketing links with your vision, it gives it the direction it needs.
If your focus is market penetration, then you need a marketing message that supports it. If the strategy is to make gains from competitors, use comparable campaigns that put the others to shame. If the plan is to sweat the asset, then any promotion needs to be subtle and reassuring.
They’re three examples, and I hope they clarify why your business plan is essential.
Question 2: Do you have a target market you want to attract/attack?
If I had a pound for every time a CEO or business owner said, “our customer is kinda everyone”, I’d have at least £239.
YOUR. TARGET. MARKET. IS. NOT. EVERYONE!
Because if it is, your budget definitely isn’t big enough. Do you think Coca-Cola targets everyone? Babies? People with diabetes? Health nuts like Cristiano Ronaldo, who can’t bear the sight of it?
Because they’d waste precious resources (that’s time and money to you and I) in the process.
Coke’s market penetration will be vastly wider than a small business, of course. But it’s still targeted at their core audience, either the one’s they currently engage with or ones they’re looking to target.
Understanding or having an idea of the target customers you’re looking to attract is MASSIVE. If you don’t but want to learn more, gain insights, this is where market research comes into play. Guess what? Agencies can also do this for you.
And if they’re not already suggesting a bit of the old research, then they might be doing you a disservice. Tell them Kootoo told you to ask why not?
Question 3: Set your budget? Have you shared it?
Now listen. I’m going to tell you something that’ll shock you.
When it comes to marketing something, you’ll need something.
Time and money.
If you can afford to invest your time into it, marketing will likely cost you less money. Even if you’re heading down the DIY route, having a dedicated budget allocation changes the game.
The next question most of you will likely ask is, “how much money should I set aside?”
Thanks for asking the most challenging question ever. There’s a general rule of thumb that I’ve no idea is accurate or not. Here we go:
Your marketing budget should be between 5% and 10% of your annual turnover (I wish).
Let’s take the £1,000,000 turnover as an example. Depending upon your margins, you would predict that a monthly marketing budget of between £4,000.00 and £8,000.00 should be enough.
And don’t put all your eggs into one basket and focus on only one channel. Consider spreading it out over a selection of the following…
- Branding and designs
- Print costs
- Website updates
- Digital – paid
- Digital – organic
- Sponsorship and partnerships
Separating your variable acquisition costs from the fixed ones will create an accurate ROI picture. Oh, and the cost for your new brand, website and materials? You can mark them down as a capital expense, away from the actual marketing budget.
Question 4: Do you know your CTA from your CPC?
It wouldn’t be marketing without a few initialisms (not acronyms).
The earlier you can understand and answer the following, however, the stronger your business will be….
- CPC = cost per click (how much does it cost every time someone clicks on your “thing”)
- CTR = click-through rate/ (what percentage of people click through from your ad/email/campaign)
- CCR = click conversion rate (out of the clicks, how many people have taken the desired action on your ad, also called a Call to Action/CTA)
- MQL = marketing qualified leads (there are a few arguments against this one, but it serves a purpose)
- CR = conversion rate (how many leads go on to be SALES)
- MQS = marketing qualified sales
- CAC = customer acquisition cost (how much has this cost per customer)
- MarRev = marketing revenue generated
- In Month ROI = percentage return on investment (from the cost of the marketing activity, what’s the percentage return you’ve made)
- CLTV = customer lifetime value
Now, let’s get hypothetical. From your £8k/month marketing pot, you’re throwing £5k into Google Ads. Let’s pretend it’s a particular month, you have specific stats, and you can see a clear picture.
Monthly Spend on PPC = £5,000
Clicks Per Month = 43,000
Cost Per Click = 11p
Click Through Rate (those coming onto your Landing Pages) = 9% (3,870)
Landing Page Conversion Rate = 6%
PPC Leads = 232 (these Leads have filled in a form or taken an action)
Tracked Sales From PPC = 23
PPC Acquisition Cost = £217.39
PPC Revenue Generated = £11,477 (if your products were hypothetically £499)
What a SUPER month it’s been for marketing there. These stats aren’t hard to get in a business. You can take out Clicks, CPC, CTR and CCR. All you need is Spend, Leads, Sales, ROI. The rest make you that bit smarter.
Four questions. Four Answers?
It’s over to you now. I could talk about tracking, with advice on how to check what’s working, and what isn’t. But there’s enough for anyone to get their teeth stuck into above.
What are your thoughts on the four questions? Have you considered any of the above points at all? Are you shortly embarking on a marketing journey loaded with every answer you need? Or are you as empty as an unloaded tanker at the dry docks in Wisconsin?
I’ve no idea where the ship analogies have come from but get in touch if you do. I’d love to hear your answers.