Over the years of coaching I’ve met many business owners that didn’t know the true cost of their marketing activities. The reason for this was very simple – they didn’t measure the results. It’s very easy to get sucked into spending on marketing especially if you need more business. But how do you know which marketing is working for you? It’s important to know because Lead Generation is the most expensive form of marketing. The results that you achieve are dependent on many different factors from copy, placement, suitability of promotion to your product/service. However if you spend £1000 on marketing you want to ensure that at the very least you get £1000 back. In reality your marketing strategy should do far more than just ‘wash its face’. If your aim is to acquire new customers then at the point of contact you need to be asking ‘how did you find out about us?’ Then at the very least you’ll start to get some idea of which marketing is working for you.
Several years ago I coached a local house builder. We started to measure the number of enquiries that came into the sales offices. Most people said they had looked at the website. When we drilled down a little further, we established that seeing the yellow site signs in the local vicinity had led them to research on the internet. In this example, it was hugely important for the website to be easy to navigate and details of the houses for sale to be up to date. This then encouraged suspects to make a site visit. Add in the happy, smiley, helpful site agent and we started to increase the likely purchase even further. Once we started to measure the number of leads to sales we increased the conversion rate even further.
You should take note that at the point of initial contact the person enquiring about your services is only a suspect. They only become a prospect when they are seriously looking at buying from you, and ultimately need to purchase from you before they can be considered a customer.
Let me give you an example. On enquiring about new tyres for my car, I simply quoted the relevant code from the tyre wall to one garage. They didn’t seem overly enthusiastic about me buying from them so I phoned another. The second garage were much more professional and hungry for my business. ‘May I just ask, how many miles a year do you do? Do you travel a lot on motorways or more locally? What type of car do you drive? What sort of tyres are currently on the car? May I just ask where did you hear about us?’ You get the picture and can guess who I bought from.
The way in which you handle an initial enquiry means you either get the business or you don’t. Measuring the total number of enquiries to sale from your marketing activities enables you to understand what your conversion rate is. Making improvements to your conversion rate is generally a very low cost. For example, the simple act of measuring the results will mean that the conversion rate goes up. Sales of Period/Number of Leads x 100 = Conversion Rate.
We can take marketing a step further when you start to measure the average £ value sale and the number of transactions. Add in measuring your profit margins and you’ll see your profits going up too.
So in reality ‘marketing is nothing more than simple maths’. Remember what gets measured gets managed. If you would like to improve your marketing then simply email me mandyhildred@actioncoach.com for a complimentary copy of ‘Buying Customers’ by Brad Sugars. You’ll get many more ideas that you can apply to your marketing today.
