AutomatedBuildings.com Column - 5 Tips to Maximize Your 2012 Marketing Dollar

I recently had a great lunch with a friend and we got to chatting about technology and the way that companies are attracting customers. If you think about it objectively the boom in the use of the internet and handheld devices has completely changed the way that businesses find customers, and the way that customers search for products.

The problem that many businesses have is that they are still trying to market and generate new customers as if it was the 1980’s, and not properly leveraging the advances in technology and Social Media to do the lion’s share of the work for them. They create their marketing plans based on dated techniques, or highly expensive advertisements that provide a limited return on investment because they are losing scope of who their customers are and how they are finding them. This is a common problem in many verticals, and can be solved by applying the 5 W’s (Who, What, Why, Where and When) before investing in marketing strategies. Let me give you an example of what I mean:

Many people in the Industrial Automation and Building Automation fields scoff at many of the Social Media and internet based marketing techniques because they believe that they simply don’t apply to an industrial vertical. Nothing could farther from the truth. The goals are the same regardless of the industry – get more customers and sell more products and services.

I was at my barber’s place last week waiting for a haircut and the owners of the shop were having a conversation with the gent in the chair about how they could attract more customers. One barber stated he was engaging in some expensive advertising campaigns on electronic billboards in coffee shops to try to boost business, but he was a little disappointed with the results so far. Then he stated that he was thinking that running some magazine ads in local publications was the answer to how to boost his customer base. Now both are fine solutions but he was making the same mistake that many businesses do – they forget who their customer is. He was generalizing his target customer’s persona instead of focussing on what persona the bulk of his is. This will cause him to make poor choices in how he attempts to attract more customers because he will invest his advertising dollars in campaigns and services that are not targeted. Much like a shotgun blast fires a wide series of pellets in a general area in the hopes of some part of the blast hitting the target. That means he will invest money in marketing strategies that will contain a broad message that is not aimed at his target customer and get a poor return on his investment.

The problem that my barber faces is not unlike one any company in Building Automation faces today. Technology companies and manufacturers often get so engrossed in the products and services that they produce that they lose that targeted focus as to “who” actually uses them. It does not matter if a company is selling routers, actuators, meters, or complete energy infrastructures, if you don’t know who your customer is, and how they find you, there is a limited prospect of sales growth. I’ve always lived by the saying “If you always do what you have always done, they you will always get what you have always gotten”. When it comes to sales and marketing I think that this is really the only attitude to adopt. Everything should be about understanding how customers are searching for your company and then using the latest tools to grow your customer base.

Let’s examine the case that I presented earlier and look at how applying the Five W’s can provide a better return on the investment of marketing dollars in 2012.

1. Know your customer (Who) – This is the most important piece of data that every business needs to know. Too often companies will lose focus on who their customer is and will generalize a customer persona. An example would be a company that makes software for Energy and Building Management. Who is their customer? The first answer that comes to mind is Engineers, but what kind of Engineers? What are their problems that your products solve? How do they search for a solution to their problems? Understanding the “Who” makes a huge difference in the way that marketing campaigns are structured, and messages are positioned, because it tells you how to position products to sell to a specific persona. Take my barber’s response when asked the question of exactly “Who” his customer is. Everybody. Everybody is not his customer. He runs a barber shop that provides men’s haircuts, shaves, and sells hair care products for men. He probably does not do a lot of ladies' perms, colors, or makeovers. By not knowing exactly who his customer is, he selected methods of advertising that reach a very general audience or “everybody”. That means that he’s investing a lot of money into programs that are positioned to hit his target market (men) and will most likely generate a poor or low return on his investment because the majority of the people that see his ads could be women and children and don’t want a men’s haircut. His approach is too general.   Similarly if your company makes software for Building Management and you spend ten grand on ads in a newsletter whose mailing list is mainly comprised of chemical and process control engineers the probability of generating leads for new customers is very low because the message is being read by people who do not require that product. Thus the return on that investment will be low.

2. Unlock the Power of your CRM (What) - While every company has some sort of CRM, or method of storing customer information, not everyone gets the most out of the data that is stored there. You could have a database of over 100,000 contacts but if the database is not maintained how many of those contacts are still potential customers? People change jobs, retire, get laid off, and if the data in a database or CRM is not current then it becomes useless. Those 100,000 contacts may easily become 30,000 if the data is not current. Similarly the customers in a CRM have purchased from you before and are a fantastic source of repeat business because you know “What” brought them to your company in the first place. The Database in your CRM will also enable you to create newsletters and product announcements to tell your customers “What” is new and exciting about your products and company. The customers receive new information about potential products and have a sales rep’s name directly in front of them to contact the Rep and discuss “what” they need to solve their latest problem. There is no lead better than when a customer calls and tells you exactly “what” they need from your company to solve their latest problem.   Information contained in the CRM will also enable you to analyze the types of sales that have been done in the past and let you know “What” the problems were that your products were purchased to solve. This will assist you in better positioning products and services as well as helping you make better decisions about what publications or advertising media strategies to use.

3. Maximizing Return on Investment (Why)? - Why is my company conducting a particular marketing activity, and what was the return on my money invested in it? Is it producing high quality leads for my reps to convert to sales? Is it effectively reaching my target customer? Is it increasing the visibility of my company and my brand?   I continually ask my clients what value they received out of their marketing activities. Sometimes clients get flustered when I question why they ran a certain campaign, or why they advertised with a specific publication. It’s not about questioning the choice that they made when they committed to an ad or campaign; it’s about protecting them and ensuring that they receive the maximum return for the dollars that they spent. As humans we hate to be sold to, but we love to buy. If your company bought ad space in a quarterly online newsletter for $10,000 and received a total of 70 leads from that newsletter would you consider it an effective way to generate sales leads? It depends on “why” the ad space was purchased.. Was the ad space purchased with the expectation of a large number of sales leads, or was it because a competitor appears in the publication. Every business owner has their own reasons ”why”, but I look at an issue like this as if it was my personal money. Would I invest it again, or would I look at another alternative? Does it effectively reach my target customer? Were the 70 leads that were generated of high quality, and did they convert to sales? If they did, how much were the combined sales from those 70 leads? Online advertising in newsletters is sometimes a lot like duck hunting. Fire at a flock of flying ducks with a shotgun and you might hit one, but if you identified your target customer correctly you can narrow your field of view and conduct a more targeted campaign directly to who wants your products or services. Take my friend the barber for example. If he analyzes his data about his clients he could determine that his clients are men between the ages of 20 – 80 who typically get traditional type haircuts (no Mohawks or braids). Once he knows that he can look at advertising in publications and conduct activities targeted to this group. His return on his investment will be higher because he is not wasting money marketing his services to people who will never need them. It’s all about making sure that every dollar spent is working hard for your company.

4. Invest in a good online presence (Where/When) – A company website has now become the online face of a particular company and spending time and money on making it presentable and easy to navigate can’t be understated. Customers need to be able to find the information that they need quickly and easily, or they will simply move on to another website after they conduct another Google search. This is also why it is extremely important to invest in a good SEO (Search Engine Optimization) strategy. You need to ensure that when a potential customer conducts an online search that your company website appears as close to the top of the Google search as possible. The options for optimizing a company website online are many, so choose carefully, or invest in hiring a marketing consultant to give you some advice as to what would be the most effective way to invest your SEO dollars. Remember if it can’t be measured it can’t be improved upon, so make sure that you are getting as much analytical data from your website and campaigns as possible. This will tell you “where” and “when” customers are searching for products and solutions on your site. It will also tell you what referring sites led them to your company website. This information is critical when looking at “where” to invest your online advertising dollars. If an ad that you placed on Facebook refers 100 customers a month to you and your ad on Yahoo only refers 10, then you can clearly see where you get the best return on your investment. These analytic reports will also provide you with geographical data to the percentages of customers in certain cities and countries who are visiting your website, and enable you to make better choices with your international advertising dollars.

5. Utilize social media (Where/When) – This is a topic that many people still wonder about its effectiveness, but the numbers simply don’t lie. It is where most of your customers are spending their time. According to LinkedIn over 75% of all B2B (Business to Business) purchasers use Social Media as part of their decision process and LinkedIn comes out on top as a business search tool. This is why it is extremely important for companies to manage their digital profiles and keep them updated. It is “where” customers are looking for you, or for more information about your company. According to Google over 85% of all purchase decisions start with an online search. This is why it is critical to ensure that a company’s digital profile is complete and the key messages are properly positioned and your website ranks high when customers search for products and services. Google is also a huge fan of Social Media websites particularly LinkedIn, so utilizing it to build brand awareness and improve your page rank mainly because LinkedIn provides high-quality inbound links.

As 2011 draws to a close consider the five tips above when reviewing your current marketing plan and creating your 2012 marketing plan. When you look at the Five W’s you can see how they all come together, especially when considering your online advertising options. By knowing the: who, what, where and why, companies can ensure that they are seeing a maximum return on investment for their marketing dollars for 2012. They will have a better understanding of where to invest their dollars so that customers will know where to look to find what they need to solve their problems.

Companies interested in having 4 Bravo Marketing show them how to create their plan for success in 2012 can contact us at info@4bravomarketing.com or me directly at manny@4bravomarketing.com

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