According to a 2014 survey by the American Marketing Association and Duke University, companies with less than $25 million in revenue spent an average of 11% of revenue on marketing. Those with $25-$99 million in revenue spent an average of 9% on marketing. That’s a significant amount of money. But the real issue is what companies get from their marketing efforts (and spending).
Why does marketing even matter? And if your sales are doing OK at the moment, why would you even want to worry about it?
Too often, businesses and organizations equate marketing with sales. But marketing’s job is generating leads. Ideally, those should be qualified leads that can be turned over to the sales team to generate sales. So if sales are good, why would you need to generate leads? Because your business needs leads. If you turn off your marketing efforts, the flow of new leads is reduced to a trickle, then drops, and then can dry up entirely.
Many businesses are cyclical. Even if you retain customers for a long time, eventually those customers leave. Or if revenues aren’t what they should be, the business needs more leads that will turn into customers. Marketing matters because leads don’t just appear out of thin air. Here are some challenges in finding new leads.
It’s Not an Overnight Proposition
While it depends somewhat on your specific industry, you can’t turn leads on like a faucet. In some industries it takes weeks, months, or even years to move someone from an “inquirerer” to qualified lead and eventually—a client. Prospects move through a process.
People Are In Different Places
Not all prospective clients are in the same place in the marketing/sales cycle. Some are gathering basic information. They might not yet even be convinced of their need. Others are comparing your offering with the competition. Some have general questions and others have very specific questions. Good marketing recognizes that the information people need varies with where they are in the process. Good marketing also recognizes that you can’t move someone ahead in the process just because your sales numbers are down.
Marketing Means Feedback
Good marketing isn’t about sending out the same old message time and time again. It’s true that you need consistency in your messaging, but successful marketing relies on feedback—what’s working and what isn’t. That means testing and tracking your results. Marketing isn’t just telling prospects why your goods or services are right for them. It’s also about listening to clients and shaping your products and services to better meet their needs. And guess what? The more of what you offer that meets needs, the more of it you’ll sell.
Why does marketing matter? It keeps your message and your value proposition in front of potential clients. If done properly, it generates new leads that drive sales. Finally, if you make sure it’s a two-way-street, it provides you with feedback about your customers. This information is what allows you to tailor your products, services, and offerings.