As a business advisor, when I meet with business owners we discuss a multitude of business-related issues, most of which fall into these four categories all of which have a direct impact on your bottom line: operations, finance, human resources and marketing. In this blog, I’m going to focus on the fourth category: marketing.
Marketing is about communication. Your business could conceive of the most innovative and useful product/service, but what good is all of that effort if nobody knows anything about your product/service or your brand? Having a good product/service is no longer enough to sustain a successful business. You need to communicate that you have a good product/service, what makes it a good product/service, the benefits that your product/service will provide potential customers, and what makes your product/service different from or better than what your competitors are offering.
Simply put, whether B2B or B2C, people are unlikely to just walk into your business and give you their hard-earned money if they don’t know who you are or what you’re selling in a marketplace defined by endless choice. Marketing is an absolute necessity for any business, small or large, because it answers the three most important questions that customers have about an unfamiliar brand: “Who are you? What do you do? How are you different?” When you make an effort to answer these questions effectively, your business will reap the benefits. Effective, value-added marketing heightens brand awareness and trust, allows you to reach your target audience and boost your customer base, and increases your bottom line.
Marketing is necessary, but I assure you that it isn’t easy. Too many inexperienced businesses make the mistake of treating marketing like medicine – only to be used when something goes wrong. Only when a product isn’t selling or revenue is dwindling do these businesses decide to consider marketing as a last-ditch effort.
Successful businesses treat marketing like food – regular, sustained, and practiced consistently. In other words, successful businesses never stop marketing. In doing so, these businesses ensure that they are always in communication with and attuned to the needs of their customers.
We have established that marketing is an essential business function, but what about the cost? Maintaining consistent communication with your audience certainly isn’t free. How much money should you invest in marketing in your business?
To make money, you need to spend money. There are a number of factors that influence how much your business should invest in marketing, such as the age and size of your business, and the level of competition in your market.
The most common strategy that businesses use to determine marketing budgets is by taking gross or projected revenue and allocating a certain percentage towards marketing. Though the exact percentages vary, newer, less established businesses benefit from an increased allocation of gross or projected revenue towards marketing (10%+). New and emerging brands need to invest a greater percentage of revenue in marketing early on in order to increase brand awareness and market share. On the other hand, established brands can generally allocate a lower percentage of revenue towards marketing (5%+).
Make sure you have a strong brand story, one that clearly differentiates your brand from your competition by clearly identifying who you are, and the value and benefit your services or products provide to your customers. Marketing gives your brand a “human touch”. Like a good friend, customers are more likely to connect and do business with a brand they feel they know and can trust. In this way, effective marketing has a direct impact on your bottom line.
Marketing has the potential to take your business to a level of success that cannot be achieved by idling and waiting for your prospective customers to find you.
How much importance is placed on marketing in your business? Are you spending the appropriate amount on your marketing efforts?
You may recall from my last post that all successful businesses have three things in common: effective policies, procedures, and processes. Today, I’m going to focus on the third “P”of business – processes. What impact does having effective processes in place have on your business? By focusing on this element of the three P’s in particular, my aim is to help you understand the significance of having processes in place in your business, and reflect on the effectiveness of your current processes.
What does it take to complete a task? A process, you may remember, is the high-level overview of a task – the map that guides you from start to finish through the steps you need to take to reach your objective. When faced with a task, how does your business act? Any successful, efficient business will have clear processes in place, with clearly outlined steps, to deal with such situations.
What types of processes exist in your business? Are they clearly implemented and communicated? To give you a sense of what processes look like, I’ve detailed below some examples of the types of processes that you should have in place in your business.
Example #1: Onboarding
You’re probably already familiar with onboarding, whether it’s by name or in concept. Onboarding is the process through which new employees acquire the knowledge, skills, and behaviours to become effective organizational members.
Do you know what your newly hired employees want out of the onboarding process? Generally speaking, new employees want on-the-job training, a review of company policies and procedures, a company tour, equipment setup, and the availability of competent and approachable mentors. New employees want to learn how to do their job efficiently and start contributing in a meaningful way as soon as possible.
In those first few weeks, new employees form their opinion of your organization. This is why onboarding is so vital. It’s a proven fact that an effective onboarding process leads to higher job satisfaction, higher retention, better performance, greater organizational commitment, and a reduction in occupational stress.
Example #2: Exiting
When an employee resigns or is terminated from a position, a number of tasks must be performed to ensure a smooth transition. If you’ve ever left a position, think about the tasks that had to be performed, the assets that had to be returned. As a business, if you forget to perform any of these tasks, you’re opening yourself up to risk.
You should keep a checklist to be followed when an employee exits so you don’t forget anything crucial. Your checklist may include: an exit interview to gain insight on areas of improvement, collection of company property (laptop, smartphone, credit cards, keys), process outstanding payroll, and the removal of building, computer, and network access. Also ensure that you have the employee’s current address and phone number if they need to be reached.
A clear exit process is necessary for your organization both to protect your business and ensure that exiting employees leave with dignity.
Example #3: Financial
Your business needs financial processes to work smoothly and mitigate risk. Some examples of essential financial processes in your business may include: accounts payable/receivable, payroll and benefits, and budgeting. Financial processes must continue without major failure day by day to avoid financial chaos. Financial processes should be efficient and effective, align with your goals, utilize best practices, and minimize risk of fraud.
The Bottom Line
Put simply, to remain successful your business needs processes of many types. For essential tasks to be completed in a way that mitigates errors and risk, those occupying the top rungs of the organizational ladder must take process creation and optimization seriously.
What do essential processes look like in your business? Are they efficient, or could they use some work?