Nothing mystifies small business owners, organizations and business leaders more than marketing. There are some very good reasons for that.
First, it’s part art, part science and part business. And because it’s such a subjective and vague thing, there are few hard and fast rules. But here are five rules to guide you in your journey to boost your profits with a minimum investment and avoid the traps along the way.
5 Rules for More Effective Marketing
Rule #1. The Three Groups of Clients or Customers Rule
All indispensable business owners and organization leaders know they have three target markets. Current clients, prospective clients, and the broader market:
1. Current clients or customers. Plan to devote 60 percent of your marketing efforts to these clients or customers. This is the smallest of the three groups but, as mentioned, “your best prospect is a current customer” and these existing clients or customers should generate the largest percentage of your profits. By investing the most in the group that produces the most profits, yet costs the least to reach, indispensable businesses and organizations maximize their total marketing investment.
2. Prospective clients or customers. Commit 30 percent of your marketing resources to win business from this group.Your goal is to nudge these people into your first market, to convert prospective prospects into clients or customers—if they fit your target profile and have problems that you can solve.
3. The broader market. Invest 10 percent of your marketing resources in the broad market. This includes everybody in the world not represented in the first two groups. Devoting resources to this group is less efficient, but it has the potential to generate important contacts and leads. The goal is to move this market into your second largest market, one that ranks in the middle for generating profits.
Rule #2. The Marketing Power of Your Own Rule
By now that you know the value of customers, and their importance as an alternative sales force. But other marketing investments are even more profitable. When indispensable business owners and organizations think growth, they also think of marketing, and they know where the real power resides and invest accordingly.
$5 spent communicating with your own staff is equivalent to $50 spent communicating with the media and $500 spent talking to your customers. Customers are great and the media very helpful, but never overlook the marketing power of your own people.
Rule #3. The Marketing Online Rule
Every savvy small business owner is now marketing online. Indispensable business owners have learned how to budget their online marketing investment.
- They invest 1/3 of it in the design of the website, making it look attractive and very simple to navigate.
- They invest another 1/3 of that online marketing budget in content, creating and distributing relevant and valuable content to attract, acquire, and engage a target audience, knowing that this the key to succeeding in SEO and becoming an trusted informational provider.
- The final 1/3 of their online marketing budget is used to improve and maintain their website, keeping it fresh and fascinating with interactivity and content.
Rule #4. The Double Mint Rule
I hate to be the news reporter and break the news to you, but even though technology is becoming cheaper (even almost free) and will continue to, you’ve still got to tackle head on that it will end up costing you double what you think it will cost to remain as a true competitive player online especially as technologies advance and evolve.
Rule #5. The Successful CEO Rule
You may consider yourself just too busy to do and run your own marketing programs and have delegated the marketing function to a great marketer. Still, I think you should know that the very successful CEOs in America are deeply involved in marketing and take full responsibility for it.
David Packard, the iconic co-founder of Hewlett Packard (HPQ), famously said, “Marketing is too important to be left to the marketing department.”
The truth is that, while the marketing function can be delegated, you can’t delegate your passion and your vision. It’s important that you take command of the process and keep your eyes on it all along, even if you delegate it. Follow this rule and you’ll never be led down a foggy road by a full of fluff and mediocre, if not downright incompetent marketer whose goals may not be quite the same as yours.