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IMPROVING YOUR MARKETING BUDGET's RETURN ON INVESTMENT (ROI)

Improving the return on the investment you make in marketing is a great way to grow your business. Because marketing is often the catalyst of sales, enhanced marketing tends to translate into increased revenues. Good applications also lends focus to the cost-side trying to get more value out of each budget dollar expensed.Making the most of every marketing dollar you spend

Increasing your top line and reducing the bottom line is otherwise known as profit margin expansion- always a crucial pursuit in any company. This kind of project yields the greatest gains when it has not been done in a while though there are always opportunities for ROI improvement.

Key Ways to Improve Your Marketing Budget ROI

  • an infusion of fresh marketing strategy & creative: all great marketing minds have a limit to their creativity and a finite scope of how they can position your offerings. Adding some "new blood" like BI brings new ideas, approaches and fresh creative to the mix. Just the interactions with new talent can revitalize your creative team and add new enthusiasm within the department. Fresh creative reinvigorates buyer interest, leading to added sales.
  • an objective analysis of your marketing model end to end: the key word is objective which is often best accomplished by professionals outside of your organization, as they won't be biased to the corporate view of things, nor pressured to see company issues & opportunities in only finite ways, etc. The analysis should cover every facet of your marketing function considering every kind of contribution from your marketing team. An objective, experienced team like BI will be able to recognize unoptimized activities, wasteful expenditures, untapped opportunities, holes in your marketing mix, etc, and then tell you about them. We also provide specific, actionable recommendations on how to best address each observation. Plugging holes in a marketing mix drives near-term sales growth.
  • quality customer & competitor research: often overlooked or under-done, one of the most fundamental drivers of great marketing organizations is solid, ongoing customer & competitor research. Getting the company closer to its customers and leveraging "best of" innovations discovered by competitors is key to helping a company grow quickly and/or maintain a position of industry leadership. BI offers an excellent model for this kind of research called collective brilliance. If your company hasn't done much customer & competitor research, you're certainly missing big growth opportunities. Quality research should drive marketing strategy & tactical execution. Otherwise you have too much reliance on best-guessing, hope & luck. There's too much at stake to employ a casino marketing model; layer in a foundation of marketing science and it will re-focus all that creativity on pursuits with real upside.
  • Etc. (there a many more)

The dominant key is more carefully considering how each marketing dollar is spent and how human resources supporting marketing strategy are utilized... in search of ways to get more out of both and/or eliminate "we've always done it that way" traditions that are now unproductive or even unprofitable. All companies accumulate inefficiencies with the passage of time. And all companies looking solely to themselves for innovation are missing opportunities to grow now. Our team can help with both.

Examples: Increasing Marketing Budget & Department ROI

Here's a couple of simple, narrowly-focused examples to illustrate how an objective, outside team like BI can help a company grow its business in this way…

  • A company had a division that produced many informational products as booklets. The influential leader of that division bundled booklets into box sets believing that these bundles as complete sets would drive more sales. In time, new products were being developed to fill out new box set concepts and the product development function became increasingly demanding- and EXPENSIVE, its infrastructure growing ever-larger, etc. However, sales growth within this division remained tepid. The division would always look impressive in corporate meetings by showing new box sets in the pipeline and steady progress against a vision of building out a good number of box sets to fulfill a vision having something to pitch to a multitude of predefined markets. The problem was that the strategy didn't seem to be growing sales- only costs. The company couldn't allocate the resources to nail down the problem so it became a BI project.

    Various forms of analysis revealed a very common occurrence at many companies: products were being developed for niche (or virtually nonexistent) markets. Market wants or needs were not actually identified; this division was building products in search of willing buyers. About 25% of their products had zero buyers (no unit sales at all) yet they required expensive ongoing maintenance and updates. Another 25% had a few buyers but not enough to be profitable... yet they too required maintenance and updates. Still another 20% of the products had enough buyers to yield a little more than break-even. This left only 30% of the products actually yielding good profit for this division. The company had allowed the strategy of building out unprofitable product lines to run for years before deciding to let us execute an objective analysis. The cumulative waste in those years was substantial (many millions of dollars). As a result, the recommendation was to prune the products that couldn't sustain themselves and focus on the products that were worthwhile. Division ROI quickly spiked.
  • A company had a selling strategy that solely relied on marketing efforts. They used only email promotions and some direct mail as their primary means of trying to proactively build up a base of subscribers. This worked OK and the company enjoyed its growth. However it recognized that the leaders of its space were larger and had a more effective pace of growth. They aspired to grow like them but couldn't nail down exactly how to do it (company ego couldn't allow them to see those competitors in objective ways).

    Our competitive analysis contrasted this company's sales model vs. the bigger, more successful peers they aspired to become revealing many things those peers were doing differently than this client. Some differences were relatively unique while others were prevalent across the peers. When competitive analysis of more successful peers shows a common practice not employed by a client, we see the practice like a strong current in a river. Their peers were going with a collectively-proven flow while our client was fighting against that current. Respecting ongoing competitor efforts to grow their businesses- something that is often challenging when insiders attempt to do this kind of work on their own- can motivate a shift in strategy to also go with the same, proven flow(s). That kind of change will almost always yield an improvement in sales... often a short-term spike that will grow and grow as the new solution is refined.

    In this case, one of the dominant currents we identified was that the competitors had telesales groups supporting their proactive marketing models. Our client was aware of this but always thought of the cost of telesales as too expensive for their company. The competition embracing it as a group implied that the telesales ROIs worked (competitors as a group wouldn't choose to lose money if telesales was not profitable). The client was persuaded to test a telesales unit. Soon, their sales more than quadrupled.
  • A company had a sales team with some super-performers, a group of average performers and another group of under-performers. The super-performers appeared to have no special advantages over the other groups and the company was puzzled at the wide discrepancy in impacts. They turned to BI.

    We analyzed their marketing model and identified a number of issues. Some were fundamental- a need for dedicated cross training so that super-performer tactics could actually be shared with the rest of the team. Some were hidden- the lead gatekeepers who filtered prospects were (over) feeding hotter prospects to the supers because the gatekeepers had incentives to get sales today (thus, there was a bias to give better leads to certain people). Some overcame animosity & isolationism issues such as establishing territories so that salespeople would not step on each other toes. In the end, there was still a range of better and weaker performers (there always is in sales departments), but those groupings were not always populated with the same people month-after-month and the group as a whole significantly increased their sales results.

Objectively Identify & Overcome Business Bottlenecks to Improve Marketing ROIs

There are many other examples. Often objective analysis will identify bottlenecks in a marketing model. For example, we've had a number of clients whose otherwise efficient marketing models would lock up because a lone person had to review creative at several steps in their process. If that person took a vacation, had some sick days, etc, the company marketing model would seize up, wasting resources until he could return. Obviously the solution was to identify these bottleneck situations and illustrate their negative (very costly) impacts- the latter of which motivated the person to get out of his own company's way and allow others to cover those particular functions. Those bottlenecks disappeared and the company achieved record revenues within 12 months.Making the most of every marketing dollar you spend

Often human bottlenecks are managers- or even company founders- who feel a need to own certain tasks. While that might have worked when the company was smaller, company growth always demands delegation of responsibility to keep the evolving engine running smoothly. Employees who can recognize the bottlenecks internally may not feel secure enough to bring them out into the open, especially when their boss or higher is the bottleneck. Or cultural pressures, ego, etc, may motivate the manager/owner to refuse to let go of some task believing that only they can do it right. Often, installing a formal strategic planning process can cure many of these kinds of issues.

A team like BI doesn't have a job at stake nor are we influenced by politics or "we've always done it that way" traditions. We are free to see situations like these clearly, document them, value their positive or negative impacts and recommend actionable solutions. We've never stepped into a situation where there were not lots of opportunities to improve marketing ROI. Try us and see for yourself.




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