Posts tagged "ROI"

Advice Customer Service Sales Strategy

Are customers testing your patience?

0 Comment read

“You can’t just ask customers what they want then try to give that to them. By the time you get it built, they’ll want something new.” Steve Jobs

Prospects and customers have an uncanny ability of getting under your skin, often driving you close to the verge of insanity. It all begins when you begin to identify potential prospects for your target segment. Those first couple of cold calls, emails and introductions set the wheels of the sales cycle into motion. Then it begins, the non responses, the transferring of your calls all over the company, being on hold for ages and even some rude responses. At this level you need to be somewhat thick skinned, you should then not have a problem getting through this stage with a list of higher probability prospects. It is during the next couple of stages when you have initial meetings, send proposals and quotations that your patience really begins to get tested. This stage differentiates the sales people who succeed, and those who just get by.

Over the last couple of years some tips that helped me during this period are:

1. Prospect Selection: In today’s market place, no one really cares for the generalist anymore. It is slowly becoming a market where niche specialists have a marked competitive advantage. I would therefore suggest you tailor your sales strategy to focus on a particular market segment and cover it extensively. If your prospect list selection covers any and everybody the number of mild leads will drive you insane. Be selective and choose your segment wisely. Next build a prospect list specific to that segment and start to make inroads.

2. CRM Software: If you are not using one for your sales development and pipeline monitoring, I would strongly suggest you look into one for your organization. If you haven’t used CRM software before, start by using simple systems such as the ones available at 37signals.com. These help tremendously in making correspondence with prospects structured, efficient and professional. It also allows you to get a dashboard view of what is moving in your pipeline and what is not.

3. Disqualification: Customers who are not interested or ready for your product/service at the present moment should be disqualified from your list. These are clients who gather information from you, and then become dormant. I suggest you develop certain time quotas, after which, if the prospect does not respond they should be disqualified from your qualification process. If this step is not done it will drain a lot of your time without necessary results. 

4. Contracts: Once you have signed up a customer for your product/service, make sure you sign comprehensive contracts with them, these must cover exactly what you will be delivering to them. Failure to do this will result in some customers asking for more than promised and you will find yourself in a difficult position. There are few things more irritating than a customer who continues to ask for changes, reviews and modifications during the delivery process. 

I don’t completely agree with the statement that “the customer is always right”. There are some situations when you will have to draw the line. Difficult customers end up costing the organization a great deal. They increase the level of frustration within the team and decrease morale. Constantly review your prospect and customer list, I use a rating system in some of the companies I work with. This lets the entire team know which customers get priority over others. Focus your energy on those leads and customers where you have the greatest ability to cross sell and develop deep relationships with.

Marketing Strategy

A Marketing Secret

0 Comment read

“Patience and perseverance have a magical effect before which difficulties disappear and obstacles vanish.” John Quincy Adams

The secret to getting the most out of your marketing plan is to remain patient. It is not as easy as it sounds however, and I have broken this rule many a time in the past. This lack of patience is due largely to the fact that most startup organizations have fairly loosely defined marketing plans. If you allocate $X per year on “marketing” activities, the chances of earning substantial returns on your investment is wishful thinking. Therefore, before beginning any marketing activity please map out your marketing plan in detail and allocate appropriate funds and metrics to the plan. Having a marketing plan is one thing, sticking to what you have charted out is a completely different ball game. 

I would like to clarify a couple of false notions that people have about marketing,

1. Instant Results: One should not expect a TV ad campaign which was screened over the weekend to help achieve quarterly target sales. Marketing is not a magic pill, which will the generate the results you want instantly. It takes time, effort and most importantly consistency to get the results that one is looking for.

2. Marketing is a Cost: I like to treat marketing as an investment, made into your organization. If one treats marketing as a cost, unfortunately it becomes one of the first things to get cut during tough times. Like any investment made in technology, infrastructure or talent, marketing must be treated similarly, to get maximum return on investment.

3. Marketing is not Advertising: I get this one a lot during discussions. A core fact is, advertising is just one tactic which can be used in a total marketing mix. Restricting your perception of marketing solely and totally to advertising will not get the required results .

The secret behind companies who are able to market themselves successfully is patience. Once they formulate a strategy, they remain committed to carrying it out to the end. Do your best to remain consistent in the messages that you send out, ensure you send them out regularly. Once the messages are out there, be patient, results will follow!

Marketing Strategy

5 Steps to Writing a Marketing Plan

0 Comment read

“As real estate is location location location, marketing is frequency frequency frequency.” Jay Conrad Levinson

Marketing is a critical component of any business strategy. Unfortunately, it is not often given the importance it deserves. This is due to a multitude of misconceptions. For starters, it is treated as a cost instead of an investment. Using this stance, it is often one of the first things to take a cost cut when controls becomes tighter. Secondly, younger organizations hardly ever commit to long term campaigns with consistency, primarily because of lack of instant results. Along with a few other misconceptions involving lack of expertise and experience, marketing is often left on the back burner. If you are a startup or an upcoming organization, please bring this component to the fore.  Listed below are five steps to get your marketing strategy in place, with a plan.

1. Situational Analysis: Prior to starting any marketing campaign, it is essential you do a thorough analysis on the industry you want to operate in. Facts such as market share, growth, trends and economic policies are critical pieces of information. Next, find out about the entrenched competitors. Who are they ? What is their market share ? How fast have they been growing? Find out about major distributors in the industry, discounting policies, strategic alliances and any other information that may help you get a better understanding of where you may want to take a stance. To read more about doing a thorough situational analysis please click here.

2. Marketing Objectives: Every plan needs to have specific goals and targets that it wants to achieve. Use this section to plan what your organization’s major marketing objectives need to be. This could include market share, customer acquisition, customer retention, website traffic or expected ROI on certain marketing tactics. These need to be thought through, and be strongly linked to major objectives set out in your business plan. To read more about setting marketing objectives please click here.

3. Marketing Strategies: This section is a major component of the entire plan. The marketing objectives outlined in the previous section, need to be translated into strategies now. This is best done by segmenting the market, and identifying areas that can be most effectively targeted.  Correctly positioning yourself in the market place, and ensuring a differentiation strategy to the entrenched competition will be an added help. To read more about correctly formulating marketing strategies please click here.

4. Marketing Tactics: After formulating broad strategies regarding marketing stance and positioning, we need to convert them into executable actions. These can be done effectively using the 4P’s structure, which helps identify executable strategies for the product, price, placement and promotion. Each section can have specific strategies to help market the product/service and reach designated targets. To read more about specific marketing tactics please click here.

5. Marketing Budgets & Controls: The last section requires the marketing budget to be structured. This budget must be strongly correlated to marketing objectives and be allocated accordingly. There needs to be a strong focus on controlling costs and creating feedback loops to ensure that relevant information is being gathered, to help identify the most effective tactics. This budget must be treated as an investment and should therefore be pegged to ROI figures. To read more about marketing budgets and controls please click here.

These five steps constitute a simple marketing plan. The entire objective of this exercise is to bring structure to marketing activities, as well as to have clearly defined goals for what we expect it to do for our organization. Marketing is not limited to super bowl ads or billboards in Time Square. It requires you to be creative with the limited budget allocated. It must be used in such a way that activities are continuously monitored and tracked, and at year end, provide a significant ROI. Just make sure you stick with the marketing plan and do not bail out halfway through. Two things your plan should incorporate, consistency and SMART objectives. Best of luck!

Marketing Strategy

Marketing Budgets and Controls

0 Comment read

“An important and often overlooked aspect of operational excellence is regularly comparing actual costs to budget assumptions – not just the numbers in the plan. Understanding assumption deviations will help improve the accuracy of future forecasting.” Bob Prosen

Budgets are a necessary evil, they draw boundaries to ensure we know how far to go with the marketing plan. With entrepreneurs , the boundary perimeter is often small and limited. This calls for ingenious tactics to make full use of creative and deal making mindsets. The budget of a marketing plan is directly correlated with objectives set by the team. The progress towards those objectives, must be monitored constantly by using control measures. These measures act as feedback mechanisms to help identify each tactic’s input. There are a few things I like to keep in mind when in the midst of setting budget and control measures:

1. Are our objectives and marketing budget in sync?: For a new business, it is important to outline realistic and attainable marketing objectives. I am all for optimistic and large goals, however, often these objectives are set without necessary resources allocated for realistic follow throughs. When discussing numbers, this is a good time to go back to objectives, and see whether attaining a 3% market share with your marketing budget, is a realistic target.

2. Have we committed more than 35% of our budget to one particular tactic, if so, is it justified?: I once had the misfortune of committing a large part of my marketing budget to running print ads in a particular magazine, specific to my target market. Unfortunately it didn’t go as well as planned, since then, I have made sure that committing a large part of the budget to one tactic or promotional activity is based on substantial research.

3. Have we established tactic specific controls?: As entrepreneurs we do not often have access to a lot of funds in our marketing budgets. It is hence essential, to ensure that control measures are established for every tactic, to maintain monthly or quarterly monitoring. If you notice the tactic is consistently not delivering as planned , adjust the plan accordingly. Having control measures in place also forces the responsible individuals to provide constructive feedback.

4. What is our expected return on investment (ROI) on our marketing budget?: This is a complex topic, and has been written about widely. To keep it simple, we have to look at our marketing budget as an investment rather than a cost. Whenever we make an investment, we look for a certain ROI to justify it. We must do the same for our marketing budget. Keep tracking your investments meticulously, and see how to improve on your investment to ensure your expected ROI. This must be discussed with the finance people at the company. I have found, they remain impartial and are able to see the forest from trees.

A well defined marketing budget can be the difference between, a good and a great result. If you have not developed one for your company, there is no better time than, now. It is important to keep in mind, that funds are wisely invested, and that you have the ability to adapt to feedback along the way.

Advice Strategy

5 Essential Facts about Revenue

0 Comment read

“A computer can tell you down to the last dime what you’ve sold. But it can never tell you how much you could have sold.” Sam Walton

An organization can have a great product and a great team, without any revenue however, they have very little. Revenue is the life blood of any enterprise; it fuels growth, motivation and success. Every organization strives to develop perfect products/services, most of the time however, they are developed with inadequate attention to revenue streams. What follows are shattered dreams and expectations, because a business without solid recurring revenue streams has nothing to stand on. Over the course of this week I have shared some basic facts with you regarding revenue streams, I have re-capped briefly below:

1. Revenue & Business Models: If you are writing a business plan or, are in a new startup venture, identify your revenue streams as clearly as possible, and understand what resources need to be put into place to realize their true potential. The future of your organizations rests upon these strategic initiatives. The business model must be based on sound revenue streams in order to succeed. To learn more about revenue and business models please click here.

2. Revenue & Market Segmentation: Once identification of a business model has been made, correct mapping of its target market is essential. Having a strategy to aim a product/service at ambiguous market segments results in spreading yourself too thin, especially when resources are tight. Market positioning of products is of paramount importance for successfully generating revenue at a quicker pace. To learn more about revenue and market segmentation please click here.

3. Revenue & Investment: Investing in correct revenue streams can be the difference between an organization that succeeds and one which does not. It is critical that metrics are put into place to ensure that all revenue streams are closely measured. This will lead to informed decisions on whether it makes financial sense to continue investing in a particular revenue or to focus energies on another stream to ensure that financial stability is maintained. To learn more about revenue and investment please click here.

4. Revenue & Change: Our world is in a constant state of flux. We are living through a time where we need to become adept at forecasting as also adapting to changes taking place. This principle applies to all aspects of our lives, in the business sense, it has far reaching implications. We have to avoid becoming rigid at all costs to maintain a competitive direction in the global market place. Failure to do so will result in an inevitable downslide of your organization. To learn more about revenue and change please click here.

5. Revenue & Metrics: Metrics are mandatory components of any successful business. Measuring your revenue streams is essential as you need to be aware of the growth rate of your streams, how quickly your pipeline is being converted, what sort of market share you hold and how the industry you operate in, is changing. Such metrics provide information that will allow you to make informed choices. To learn more about revenue and metrics please click here.

In todays day and age there are a plethora of startups which have no clear business model, some are purely developed attractive acquisitions while others wait to see how they develop. My advice is, go in with a plan on making money from day one if you want to build a strong and well founded organization. When developing your streams ensure that you cater to each level of your market segment and create opportunities for scalability and cross selling. Doing so will put you in a favorable position to succeed. 

Advice Strategy

Metrics for Revenue Streams

0 Comment read

Every company has metrics that track performance. The key question is whether these metrics really provide visibility to performance as viewed by the customer.” Steve Matthesen

Working at a startup, there are always a host of things which need to get done. It is a constant battle with time to stay on track and achieve goals and targets. In the midst of this daily commotion, we are inundated with information from all sides. To keep abreast of all these developments, it is essential to develop a system which provides dashboard views about current standings. This is where metrics come into play. They need to be incorporated into every major business function to provide real-time statistics and keep the focus in the right direction.

The metrics for revenue streams used at some of the organizations that I work with, range from being very simple to relatively complex depending on the nature of the business. I have experienced that there are a few metrics which need more focus than others where revenue is concerned. They are:

1. Revenue Stream Growth: This metric provides data regarding development of each stream of revenue by quarter. It involves data which includes percentage growth numbers, pipeline activity and deal closures. These figures provide detail analysis on streams that are growing at a faster pace than others, the stages of revenue facing plateaus and how projected business is forecast in the coming quarters for each stream. 

2. ROI on Revenue Streams: It is one thing to have an extremely high turnover and a completely different story when that is not being converted into bottom line results. This metric provides data regarding the profitability of each segment and a break-down of investment into the stream, as well as marketing costs and cost of goods/services. Constant vigilance helps regarding which streams need to be promoted and which need to be ceased. 

3. Market Share & Industry Analytics: This metric keeps track of current growth trends in the industry the organization operates in. It constantly updates data regarding major changes on competition, government policies, economics climate and company position. This requires constant study to stay current with the rapid changes taking place. 

While keeping all the metrics in mind make sure that you take time out to compare them with related metrics to customers, vendors, suppliers and distributors. This will ensure a complete picture of the current situation. At an early stage startup, complicated metrics are not necessary, what is required however, is the ability to put these metrics into practice at basic levels. This will ensure that the position and development of the company is dealt with more effectively.