We Eat Our Own Cooking: A Plan for Keeping Marketing Costs Under Control

Ironically, running a small business myself, I’m aware of the unlimited number of marketing agencies vying for the chance to sell me their services. And in today's marketing world, many vendors are offering a very specialized set of services, which means companies often have to work with multiple vendors to get what they need. Combine that with an internal marketing employee or team, and you could find yourself blowing through your marketing budget very, very quickly.

So, how do you avoid falling into the trap of designating more and more dollars to marketing campaigns? Maintaining a marketing budget is key to your company's success. Your organization should have a baseline marketing budget that remains fixed, yet able to maintain incremental growth as cash flow permits. Of course, if your business is successful, you may find yourself wanting to add more marketing activities based on available resources.

But how do you contextualize your marketing budget against the budgets of other organizational departments in your company? There are three key pieces that marketing campaigns need to accomplish:

• establishing a strong brand narrative and directing its execution
• aligning the marketing campaign with the goals and efforts of the sales team
• understanding managerial finances and maintaining a budget

I'll be honest. If you can find a full-time employee who is capable of accomplishing these three pieces well, hire that person. You'll have an expected fixed cost, which can be better controlled and maintained. However, do know that finding a single person who can accomplish each of these pieces is rare. Whichever route you choose to take, I’ve offered some tips below on how you can work to make your marketing campaigns predictable.    

Identify your marketing needs 

Before finalizing your marketing budget, take a look at this 5-step process that will help you identify critical marketing activities for your business, based on where your customers are in the buying process. 

1. Understand the financial goals of the business, and determine your marketing budget. The goal of any marketing campaign is to increase revenue, and if your company is unable to meet and exceed quarterly and annual revenue goals, your marketing campaigns aren’t doing their job. Once you determine the revenue goals for the coming year or quarter, figure out exactly how many customers you will need to reach these goals. 

2. Analyze the customers from your previous fiscal year. If you're not familiar with the Pareto Principle, it states that roughly 80% of effects result from 20% of the causes. Use this principle to determine your marketing needs by identifying the 20 percent of customers that led to 80 percent of your revenue. By doing this, you’re getting a glimpse into who your ideal target market is for the coming quarter or year.  

3. Identify how these 20 percent of your customers went from prospects to buyers. Take the time to identify the triggers that caused these prospects to move through each stage of your pipeline to become paying customers. Determine what marketing techniques improved your company's profit margins and increased sales volume. Once you've got a good handle on the causes and effects, you can begin to operationalize that marketing activity for scalability.  

4. Use your Customer Relationship Management (CRM) system to identify where your current prospects are within the buyer's journey. Every sales cycle looks different, but with a proper CRM system in place, you should be able to identify where your buyers are positioned within their journey — including whether they’ve even been identified you at all. Whether your problem is generating leads or moving prospects past overcoming barriers, you are now better positioned to tailor your marketing strategies accordingly.

5. Make a decision about where to focus your marketing efforts. By understanding where your prospects sit within the sales pipeline, you understand at which stage of their buyer’s journey that you’ll need to target. Knowing this keeps you from wasting money and resources on techniques that don't get results. It gives you a people-focused marketing strategy that prioritizes the 20 percent of customers most likely to become your most frequented and loyal customers. 

Following the above process will help you keep your marketing costs under control. It ensures that you, and you alone, are in the driver's seat of your own marketing operations, not dependent on solutions recommended by any single vendor, or series of vendors.

Find the right partner

If you don't have a marketing employee or department who can follow the above process and yield business results, find a marketing partner who will get you where you need to be. The most important component here is to understand your own value chain. Every marketing agency, too, has their own value chain, and your company should analyze whether or not a marketing partner's value chain aligns with your own. 

For example, if all you need is a truly optimized CRM, there's no reason to go through with a costly rebrand, or jump through any other hoops, no matter what marketing agencies try to convince you.

Navigating the waters of marketing campaigns can be complex, but it doesn't need to be. What we can offer is a process to make marketing more predictable by helping you leverage technology to build accountabilities into your marketing and sales efforts without compromising the human connections that lead to revenue.