Smart Marketing for Entrepreneurs
by Pat Price Any marketing done well is smart marketing, right? Wrong. If you paid a couple of thousand dollars for a campaign that looked great and generated leads, that’s great. But if you got it for next to nothing and generated real sales, that’s smart! Actually, that’s only one way it was smart. Let me explain.
SMART Marketing
You may have heard of SMART objectives before. The experts who design corporate objective-setting criteria use SMART as an easy to remember acronym for Specific, Measurable, Actionable, Results-oriented, and Time-bound. If all of those elements are part of an individual’s objectives, you’ve got a mechanism in place to create great results. With a little modification, the same SMART acronym can be used to test the efficacy of your marketing program. In this case it stands for Specific, Mindshare-grabbing, Action-oriented, Results-focused and Tuned. It’s a simple method to quickly determine the quality of your program and can help point out potential pitfalls. Let’s examine each element.
S - Specific
This describes the who, what, where, when (or how often) of your program. The more specific you can be with each of these components, the better your program will be. Who, specifically, are you targeting with your marketing? The more you know about them, the more effective your communication with them will be. Are you focused on people 25 – 30 years of age, or are college students also in your target? How you approach them and with which media will be largely driven by who they are, what they read, where they shop, and what they buy. Your target group dictates the type of media and placement. What will you be positioning in your program? Is it a new product? What makes it uniquely better than your competitors’? What benefits does it provide? The more specific you can be about the unique benefits to your customer, the better. And, improve your results even further by establishing a leadership position— even if it’s in a new category you create. Where will you be advertising? This refers to your geographic serving area (local, county, state, national, or, as with the Internet, global) and it also refers to
where you’ll be doing your placement. If you’ve decided to take out a classified ad, for example, in which publications will you be present? This is driven by knowledge of your customers’ viewing habits. You also need to consider frequency of communications. It’s through repetition that true marketing success occurs. Frequency breeds familiarity with you and your product, and familiarity helps to breed confidence. Only then can you start to see sales. So, this part of the mix also defines how many of those classified ads you’ll be running to increase your credibility. A useful way to visualize the results of this first guideline is with a matrix. Each of your deliverables, or elements of the marketing mix, occupy a row, with specific information describing who, where and when each will be used over the next year in corresponding columns. This tool can also provide the timeline to link your marketing program with your business planning and operations.
M - Mindshare grabbing
Now let’s focus on how the program should be structured. I suggest you set up checkpoints in your program’s development and design to insure you don’t stray from the most important element of this mix – the customer. That sounds very basic, doesn’t it? But it’s amazing how often marketers (and business heads) fall in love with their product or service and lose sight of those whose opinion really matters – their customers’. But, I’ve been there. And I know how easy it is to get lost when you’re down in the details of some competitive claim with your lawyers. It is so easy to get caught up in internal strategic discussions, and lose sight of what your customer needs versus what your own business plan needs. This trap leads to marketing that looks great and makes the product shine – but it only appeals to those in your company and no one else. So, first and foremost, the name of the game is to keep your target customer in mind at every step of your marketing planning and implementation. Continue to ask yourself – what would my customer want to see and hear? And of course, that boils down to real benefits, advantages, and what’s in it for the customer. Don’t fall into the trap of describing features. Translate those into tangible benefits for the customer. And if you can quantify those benefits in real dollar savings, or additional revenue, all the better. If you can also appeal to the customer’s psychological benefits, your case gets even stronger. If it makes them happier, smarter, healthier, sexier, or gives them greater status, your positioning is that much more effective. Does every facet of your program grab customer mindshare?
A - Action – oriented
Continuing the customer-focused section above, ask and you shall receive. Or put another way, if you don’t ask, how will your customers know what to do? So, ask the customer to take some specific action to get the result you want. Don’t leave it to chance. This is such a simple concept, but one that’s easily overlooked. If you place that classified ad, for example, specifically include in it a call to action for your customer. Tell them what they should do – drop by your store, clip a coupon and mail it in, call you, check your website… whatever. Just get them involved and engaged with you.
R - Results focused
This describes the end result you need from your marketing program. You’ve got to know what your destination is. Or how will you know how to get there – or whether you’ve arrived? You should have a clear set of objectives for your marketing program. For a new business, those may be very different from an established business’s program. Likewise, it can vary widely from one industry to another. But the key is to know exactly what you need to accomplish – and to be realistic. Too often there is an expectation of instant gratification. Like a fine wine, the program takes time. Your customers need to feel comfortable and confident in you – and that comes with consistent repetition. Your results for the program should include growth in your customer database. This is so crucial to business survival today. And the marketing industry is full of resources and information on relationship marketing, customer database management, and market research information down to the gnat’s eyelash. There’s plenty of help out there to give you additional ideas for growing your database. It should also include an estimation of the value of each of those names in your database. How much do your repeat customers purchase from you in a year? What’s the real value (in dollars) of that relationship? Once you know how much each customer is worth to you, it’s easier to analyze the effectiveness of your program, per the following section.
T - Tuned
Last but not least, here’s an item near and dear to all of us. How do I save money? Or can I be spending less than I currently am, and still be as effective? In order to intelligently fine-tune your program, you’ve got to know what’s working, and what’s not. And for that, you need to run tests, measure the results, and compare. This is the step that most people HATE. But it doesn’t have to be tedious and laborious. Just keep telling yourself – this is where the really smart businessperson outperforms their competition. So to make it easy, keep it simple.
First, set up your program to continuously be in an information collection mode. Then, measure, measure, and measure. Set up a basic system to help you track each media’s effectiveness. If you’re doing comparisons of classified ads in various publications, for example, you can include a separate offer, or coded coupon, in each. If you have a retail presence, you can ask customers directly when they come to your location which ad they saw. Now the fun part – saving money. As you look at the cost to acquire a new customer across your entire campaign, you may need to drop some items. After all, what good is a marketing campaign that costs $1000 per customer acquisition, if you only expect $400 in follow-through sales from each new client? You need to be able to compare results from various methods to determine which are best. But how do you compare the pull from a magazine ad to that of a TV commercial? You need to use an apples-to-apples method of measuring results. And there’s no better yardstick than dollars. Although it’s fairly straightforward to measure cost (via circulation numbers or per household), the more effective measure is to determine your profitability. Subtract your costs (include design, production and placement costs) for each medium from the revenue you tracked from that source. Do this for each medium in your campaign. Then, you know your lowest performing media – those that are targets to drop. (Granted, some media are used strictly for awareness-building and don’t intrinsically generate revenue. Use some judgment here. Some things you HAVE to have, especially in start-up mode.) Measurements allow you to compare various media, and optimize your campaign based on trimming back to those that give you the most bang for the buck. This may be the single most effective method for optimizing your marketing dollars.
Conclusion
With so many options today for marketing your products and services, it’s more important than ever to systematically check the effectiveness of your program. By checking your program against the SMART guidelines (Specific, Mindsharegrabbing, Action-oriented, Results-focused, and Tuned), you can help predict your results. The SMART marketing method is one more tool you can use to quickly decide what’s working (and not working) for you.