So you’ve developed your sales and marketing plan, you’ve started implementing it, and 2016 is racing ahead. But how do you really know whether your plan is working or if you should revise or change it before time gets away? The only way to know is to actually test and measure your sales and marketing plan.
Believe it or not, testing and measuring is NOT new to you – you’ve probably been doing it your whole business life. At its most basic, the ‘trial and error’ method will have given you a catalogue of useful learnings over the months or years. The next step is to make decisions based on that information and adapt your sales and marketing plan for a successful business moving forward.
So, what marketing metrics should you use?
As well as objectives, budget, competitor market overview and SWOT, your sales and marketing plan should include the following FIVE marketing metrics, to make testing and measuring easier:
Metric 1: Direct feedback
You must start asking people where or how they found you. It’s difficult to judge how a particular advertisement is going based on sales alone. From working with thousands of business owners we can tell you that almost everyone will be happy to give you this info. Record this data, it could be a great indicator of what’s working or what in your sales and marketing plan you need to change.
Metric 2: Acquisition Costs
We discussed in a recent ActionCOACH blog the cost of acquiring new customers. The acquisition cost must, at minimum, be less than the lifetime value of the client – that way you know you will make a profit from them and that your marketing budget is sustainable. If it’s not, you will need to revise how you acquire new business in your sales and marketing plan. Better still, if your Acquisition Cost is less than what you make out of a customer in the first transaction, then you have yourself an unlimited marketing budget!
Metric 3: The 5 Ways
To maximise your chance of increasing each of them, you must track each of the 5 ways: How many new leads did you generate last week/month/quarter? What percentage of them did you convert to a customer? On average, how many times did each of your customers buy from you and what did they spend each time? And what was your net profit margin? Just starting to measure each of these will often get them moving in the right direction!
Metric 4: Lifetime Value
Closely related to Leads, the lifetime value of a client can be measured against the cost of generating the lead for this client, to work out whether this particular client is sustainable and also whether the methods used to generate them are worth keeping in your sales and marketing plan.
Metric 5: In & outbound marketing methods
Whether you are pushing your message outbound to a wide audience, or making yourself more visible online to attract inbound customers to your business, you can test and measure both to determine how to change them in your plan. Inbound marketing is proving to be a more and more successful form of marketing as the population gets inundated with more marketing messages each day, so look at the cost of these activities closely.
There are many CRMs, databases and other tracking tools out there that will help you to keep track of these metrics. One way or the other, every time a prospect or customer interacts with your business, whether a sale is made or not, this must be recorded. If there is a large slice of the budget going to an activity which your CRM tells you has made no sales, it’s time to address and revise!
If you would like to design a sales and marketing plan that you can test and measure to make this your most successful year yet, book in for a FREE 90min coaching session and you will walk away with ideas and tools to put these into place. BOOK HERE or Register for the 6 Steps to Building a Better Business Seminar here.