Small-business owners are always devising “killer” marketing or ad campaigns that – in theory at least – will send business soaring. Whether created in-house or with outside help, it can be a great concept, with sparkling design and a compelling message and yet still bomb big time.
What’s up with that? In most cases it’s simply because you didn’t think beyond a great-looking ad, perfectly crafted email, irresistible offer, rousing radio spot or breakthrough banner.
The missing piece is often a data-driven strategy for getting the message into the right places at the right time with the right frequency to make the effort truly pay off.
Another way of framing this issue is to ask a relevant question: Does marketing success come more from art? Or analytics? Some also cast this as a difference between “soft” marketing (art) and “hard” marketing (data-based).
You need to learn exactly how and why your hard-earned marketing dollars are netting you a return or not, and what you can and should do in the future to squeeze every ounce of improved profit from your effort. This kind of metrics-focused marketing starts with three main activities:
• Setting goals and targets upfront. These should include such things as how many incremental sales are generated, how much revenue each sale produces and the gross margin. In short, you want to know precisely what impact your marketing efforts are having on revenue so you can make changes as needed.
• Designing or selecting your marketing programs to be measurable in the first place.
• Focusing on decisions that will improve your marketing results.
Here are three key marketing metrics most small business should consider:
• Lead conversion rate. Converting leads into sales is what really counts. Your conversion rate is the percentage of leads that ultimately become sales (10 sales from 100 leads equals a 10 percent conversion rate).