In other words, the strategies and tactics in your 2011 Marketing Plan need to be measurable. But, it is more serious than that. The plan must also breakdown how you will acquire, retain and grow client value. Yes, it needs to focus on clients.
Most firms believe they already focus on clients. If this is true, then why do we spend 80% of our marketing resources acquiring the 20% of new clients that are needed each year to replace lost clients?
The answer to that is simple: It costs at least 5 times as much to gain a new client as it does to keep an existing client. But it still begs the question: How do we keep existing clients? You need to bridge the gap between marketing and business development, and you need to measure results.
Measurement can be a tricky thing when it comes to marketing performance. Some firms already measure the results of marketing, but are they measuring the important metrics? It reminds me of the quality craze in the industry when every firm was using quality as a way to differentiate. The firm I was at adopted the Phillip Crosby model. Everyone from clerical up to management was tasked with charting some aspect of their work. It soon became clear that there were a lot of things that could be measured, but not all of them were beneficial for improving job performance or quality.
The same is true in marketing. For example, the number of proposals written or hit rates could be measured. Obviously, these are metrics that are directly related to the number of new jobs. However, what if all of the new projects are coming from existing clients? If your overall hit rate is 70% and all of the projects come from clients who are at 100%, your effective new client hit rate might be at 35%. Is that a metric your company can prosper with? We can look at a different scenario to prove this point.
What if your new projects are falling in one market or service sector when your mission is to find work in multiple markets and service sectors? On the outside the return on marketing investment looks rosy, but when you peel back the results, the future does not look as good.
This is the paradox of measuring return on marketing investment. On one side you have to build client loyalty and on the other you need to find projects in multiple markets and service sectors. For many firms it means taking a new approach to market planning. It must start with the 2011 Marketing Plan.
The framework of the plan—Objectives, Goals, Strategies and Tactics—remain the same. Measurement happens in the details. When you review strengths, weaknesses, opportunities and threats, you must start at the beginning with market research. What does your firm research prior to developing an annual marketing plan? Remember the three types of research: Secondary, Syndicated and Primary.
Are these essentials included in your annual market planning activities? In my seminars and workshops, I always like to use the story of Alice in Wonderland. Remember when she comes out of the hole and she asks the caterpillar which way she should turn? The caterpillar answers, “Where are you headed?” Alice replies, “I don’t know.” Then the caterpillar says, “Then it doesn’t matter which way your turn.”
Marketing plans without a foundation of research represent the same dilemma. It is no wonder that most industry marketing plans are simply copies of the previous year with new numbers.
Like I said at the beginning of this blog, 2011 is the year to get serious because management is serious. Management is no longer giving a rubber stamp to market planning as usual. They want measurement that is effective. Although they look at the bottom line, they recognize the business needs of feeding all service sectors and markets as well. Maybe they have even challenged you to look at new markets.
Business Development Professionals has developed a new workshop to help marketing services professionals with 2011 marketing plans. “Create a Client-Centric, Measurable Marketing Plan to Acquire, Retain and Grow Client Value” is the one learning experience that will help you achieve management’s expectations as you document the return on marketing investment (ROMI).
The Workshop will be held in Chicago on December 3 and Philadelphia on December 7. It will also be held in four other cities next January and February. For information call (610) 908-5143 or visit the website: www.businessdevelopmentpros.org
