Maximize marketing potential.
Editor's Note: This column is part of an ongoing series by family business leaders and advisors with information and ideas about topics unique to family businesses, developed in conjunction with the Conway Center for Family Business.
By Kelly Borth
According to Wikipedia, "bang for the buck is an idiom meaning the worth of one's money or exertion. The phrase originated from the slang usage of 'bang' which means 'excitement' and 'buck' which means 'money.'"
For family businesses to take advantage of and benefit from a "best bang" strategy, they must approach it from a position of strength and knowledge-not by "shooting from the hip." They need to analyze market segments and saturation levels, degree of reach, penetration and cost, and make a decision that very logically will deliver the best return on their investment.
Analyzing marketing segments
Understanding market position is an important step in the process. Know where you have the greatest growth potential-it could be through new customer acquisition, but it could also be through current customer relationships. Is there potential to grow market share? Which markets and/or products provide the greatest profit margin? Your bang for the buck will be determined based on the degree of opportunity and profit growth.
Degree of reach
You should have a marketing plan with strategies to grow your business within select markets. If you don't, get one! Analyze each marketing tactic based on the degree of reach within the potential prospect base. A trade show, for example, may be a great marketing strategy, but it may only reach 10 percent of the market. That does not make it a bad marketing tactic. Know what your degree of reach is for every marketing dollar spent to get a better sense of which tactics best deliver for your business.
The penetration factor
Meaningful market penetration is necessary in order to assure your marketing message is heard by the prospects that have a need, that you have provided sufficient opportunity to gain purchase consideration and that prospects respond. Marketing penetration can be determined by the probability of frequency of messaging needed to elicit a response. Not all marketing tactics require the same level of frequency, so it is important to understand best practices for each. Ultimately, your goal is to reach an adequate level of market penetration to optimize results.
Underspending can be as ineffective as not spending at all. Make sure you are spending enough to get adequate results. You never want to be "penny wise and pound foolish." If you lack a committed marketing strategy-you spend a little here and there, try this or that-you won't have great results in the end. You may sum it up to "marketing just doesn't work" but what's really not working is the approach.
The best bang theory
Starting from a position of strength makes sense when you really think about it. The smarter you are about your market position, the greater results you should see from your marketing investment. Take an assessment of how effective you think your current marketing program is - 25 percent, 50 percent, 75 percent effective? If you could increase that percentage and put that money to work in smarter ways, what could you achieve? For your biggest bang, invest in developing a strategic marketing plan that defines your family business' market position and maps out a strategy for how you best compete and how you are going to increase market share.
Kelly Borth is CEO and chief strategy officer for GREENCREST, a 25-year brand development, strategic and interactive marketing and public relations firm that turns market players into industry leaders™. Reach her at (614) 885-7921, firstname.lastname@example.org, @brandpro or for more information, visit greencrest.com.
The Conway Center for Family Business will host Kelly Borth on Oct. 15 from 7:30 a.m.-9 a.m. where she will speak on how to stand out from the crowd. Visit familybusinesscenter.com for more information.