build a flexible marketing model to ensure perpetual growth #073
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Published on 22 December 2011by Tony Groom
Build a Flexible Marketing Model to Ensure Perpetual Growth
Following on from the flexible business model that we developed to ensure the
perpetual survival of businesses for what looks like a long period of economic
stagnation, it makes sense to explore how growth can be achieved without ‘betting
the farm’.
While businesses may breathe a sigh of relief if they have followed our advice on
how to ensure their survival, it is also necessary to look at the marketing model. The
principles of flexible marketing are similar to those of survival as they involve tight
cash management and being aware of the fixed nature of many contracts for
promotion initiatives that either don’t work or become a financial burden.
Marketing can be complicated as it involves getting a mix right between many
variables. There are lots of alternative ways to achieve marketing objectives where it
is often difficult to measure success in terms of ‘return on marketing spend’ or ‘bang
for buck’ when developing a marketing plan.
Quite apart from developing a plan, marketing activities can serve a number of
purposes which makes measurement even more difficult. The model that works best
will be different for every business, but when markets are so uncertain and cash is
tight marketing can make the difference between failure, survival or growth. The real
issue is uncertainty where the key is to understand and then manage the relationship
between cost and return for different marketing activities. Flexibility reduces the cost
of switching between activities which in turn reduces the cost of getting it wrong. The
process involves continuously improving your ability to be certain about the cost and
outcome of any marketing initiatives.
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Call Tony Groom on 0844 8040 540
There are a vast number of possible objectives such as: generating new sales leads,
selling different products or services to existing customers, launching a new product,
persuading potential customers to buy from you, or reassuring clients by building a
reputation. This latter objective of establishing credibility is common for those firms
that sell advice or professional services when they want to set up or move into a new
geographical market.
Having established your purpose and defined marketing objectives it is necessary to
consider the possible marketing initiatives, affordability and how they might be
measured in terms of cost and outcome.
Essentially the flexible marketing model is based on a process of trial and error where
you can afford to get it wrong. Until the outcome is established through
measurement most marketing initiatives are a speculative investment. The challenge
is to compare the outcome with lots of different initiatives.
Simply placing a single advertisement can work for some firms even if it is expensive,
providing the results justify the cost. Many businesses like emergency repair services
used to rely on one large advert in Yellow Pages. Now it is more difficult for the
plumber or locksmith to ensure potential customers find their advert when they have
an emergency. Nowadays such firms need to be listed in a large number of possible
directories including online.
Affordability versus flexibility can be an issue especially when payment is spread over
a period of time. After their hype, many advertising and promotion contracts are
regretted when expectations aren’t met. It is acknowledged that flexibility is likely to
cost more but there is a distinction between trialling a marketing initiative and a
long-term campaign that will almost certainly be cheaper, unless the marketing
benefits have already been established so as to justify the financial commitment.
Most initiatives can be easily trialled and measured without the need for a long-term
commitment to test whether they work, e.g. pay per click such as Google Adwords,
internet banners, leaflets, posters, adverts on print, radio or television, redemption
vouchers, point of sale promotions, text based promotions, stands at trade fairs and
even short-term rent or pop-up shops.
Comparing the costs versus benefits for several initiatives will help refine the
marketing model and over time improve the certainty of a return on marketing
investment.
Less easy to measure are longer term marketing initiatives such as publishing articles
in online media to generate visits to a company’s website. Similarly public relations
and press releases to relevant media can generate press interest that raises
awareness but may not produce immediate sales. These need not be expensive and
can help establish a reputation for the business as an expert in its field which is
reinforced by articles and press coverage. While this is a more speculative approach
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Call Tony Groom on 0844 8040 540
to marketing it offers longer term benefits since print and internet published articles
and press coverage tend to be picked up by search engines and therefore have a
long life. To some extent the decision to use such methods will depend on whether
the business firstly can afford to invest the money and secondly is looking to a longer
term return than immediate sales or orders.
Another tactic to consider might be ‘bootstrap’ or ‘guerrilla’ marketing which is
especially useful when a business has little money to spend on marketing. A good
example is promotion of the Ultimo silicone gel bra by Michelle Mone when it was
launched in Selfridges. With little money for a marketing campaign Michelle hired
out of work actors, dressed them in hospital masks and coats, gave them placards
and alerted the press to a protest in Oxford Street by cosmetic surgeons against the
loss of work they would suffer because of this new bra.
Whatever initiatives are deployed, the marketing mix needs to be continuously
reviewed and refined in exactly the same way as applies to using a flexible, cost
sensitive business model.
Add a flexible marketing model to a flexible business model and you can both
ensure perpetual survival in a difficult economic climate and perpetual growth.
We are not Insolvency Practitioners. We operate within the law to protect our clients and their wealth. Our team has worked for over 20 years to help stabilise and return hundreds of businesses to profitable growth. Once appointed, Insolvency Practitioners do not work for you, they work for creditors and use your company’s assets to pay themselves. We work for you, not creditors.
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