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Mistake #7
Not Tracking Results
The question I hear most from small business owners is, “What will I get from my marketing dollars?” Linking the money spent back to results is a crucial principle of my Lean Marketing process. In Lean Marketing, guessing and estimating are replaced by data-driven analysis and measurable outcomes.
Every marketer should be able to answer the question, “Will this make me money?”
The goal is to know the desired outcome of your marketing before you spend a dime. You should think of marketing as an investment, much like any other—stocks, real estate, mutual funds, etc. When you do this, replace all marketing activities that do not provably generate revenue with ones that do.
I grew up in direct marketing, trying to find out what works and what doesn’t. However, today’s new digital marketing channels make it possible to measure success more quickly. Digital marketing has real-time access to a wide variety of information. Because digital data can connect knowledge across sources such as social, mobile, and web, results are usually just a click away.
How to Focus on Results
There are several steps small business owners can take to focus on outcomes:
Measure what’s important. Even if you don’t have much money for marketing, you benefit by focusing on those activities that generate revenue. You do this by concentrating on a few key metrics and tracking them daily. Chances are you’ll be using digital marketing, which has tons of parameters—an overwhelming number for most people looking at them. The real challenge is to narrow it down to just a vital few.
Track the total number of leads and how many of those qualify after your marketing and sales screens. Once you’ve done that, determine your cost per lead and cost per closed sale. Add on other essential metrics. Keep it at ten or less total, and don’t include any that don’t eventually directly lead to revenue (such as the number of likes).
Prune what doesn’t work. Results-based marketing forces you to change from marketing messages that create awareness to ads that generate results. Spending money on non-revenue-generating marketing is like spending money on equipment or people that don’t perform. It’s a waste, and it isn’t Lean. There’s also an opportunity cost involved. When you spend money on something that doesn’t work, you’re taking money away from something that does.
Expand from your core. Eventually, you’ll want to spend about 80 percent of your marketing dollars on activities that are proven successful. Use the remaining 20 percent to test new ideas. It ensures a consistent marketing funnel that produces results. Just remember, you want to test all the time, but you need to balance the testing with results.
Change Your Media Allocation. I’m biased here because of my background in direct marketing. But, how can you justify spending marketing dollars on things you can’t measure? To be a Lean Marketer, you need to switch your media allocation away from branding and image-based advertising to media that show results. For most small businesses, branding is a waste of money. Yes, you should have a consistent brand image. However, you don’t have enough money or time to build a brand. Focus on direct response instead.
Mistake #8
Taking No Action
This mistake comes in two forms: 1) not following up on leads and 2) not responding based on results. Inaction, in both cases, leads to wasted marketing dollars. The core philosophy behind “Lean” is “Build-Measure-Learn.” This iterative process does no good if action is not taken based on the learnings. Let’s look at each one.
Not Following up on Leads
Failing to follow up is the most significant marketing sin of all time. It never ceases to amaze me that the majority of leads generated by marketing are not followed up by salespeople. It’s a tremendously expensive mistake, and it makes absolutely no sense! At a minimum, leads should be put into an automated system for follow-up (see mistake #58).
Why does this happen? Research suggests that only one in every 50 deals occurs right away, yet many sales efforts are ditched right at the beginning. People don’t initially buy for a host of reasons: inertia, lack of time, too many other things on their plate, concerns about cost, etc. Often, prospects want to confirm their decision before they make the purchase.
Here’s a good practice to ensure this doesn’t happen:
The Five “No’s” Follow-Up Strategy
Introduce a rule in your company where you maintain contact with every prospect until each one of them has said “no” or “not now” at least five times.
Not Taking Action Based on Results
With the marketing tools available today (e.g., Google Analytics, CRM systems, etc.), it’s easier to track results than ever. What small businesses are doing with this data is less clear. A mistake that I see is having useful data but not knowing what to do with it. Checking your numbers frequently gives you a good idea if your campaigns are working or not.
Here’s a tip. Do not look solely at the numbers alone – always try to find the root cause of the results. Challenge yourself to action. The answer might be to wait for more data, but at least you’ve gone through the process of reviewing the results.
Mistake #9
Ignoring The Competition
Many small business owners ignore their competition, and sometimes it’s for a good reason. There are three reasons why:
1 Why waste your resources on competitors? Tracking your rivals takes time, wouldn’t that time be better allocated on your own business?
2 Focus on your customers instead. The majority of an entrepreneur’s time should be spent on his or her customers and finding out what they need.
3 Don’t duplicate problems. If you spend too much time analyzing the competitors, you may end up having the same issues they do.
Why You Should Track Your Competitors
On the other hand, when you ignore your competitors, you do so at your peril. Here are some reasons to focus on your competitors a little more:
You may have to. What if you’re about ready to launch a new product offering, and your competitor beats you to the punch? By keeping an eye on your competitors, you can react before they do.
Learn from their mistakes. Look at what your competitors have done recently. Where did they go wrong? Did they miss out on a specific prospect? Whatever they’ve done poorly, try not to make the same mistake.
Watch out for your employees. Increasingly, your competitors come from within when ex-employees form companies. Understand if they could be a threat to your business.
How to Track Competitors
Here are some easy ways to track competitors:
Pick three. Find three other businesses like yours and study their marketing like you were back in school. Pay special attention to the tactics they only do once and those they repeat every month. Learn from their mistakes and successes.
