More ways to waste those marketing dollars!

Every day, some company throws its marketing dollars out of the window. Whatever the reason, these businesses provide some good examples of what not to do when marketing. My final five of the “top 10” money wasting techniques:

. Ignoring existing customers as a source of additional business. Marketing experts say it costs 10 times more to develop a new customer than to generate additional business from an existing one. Therefore, it is more cost-effective to focus marketing dollars on building strong, positive customer relationships. Call them on a regular basis, even if you aren’t working with them at the moment. Take them to dinner or a ball game. Find out what their favorite activity is and share it with them. Adhere to the multiple relationship theory: the more relationships a customer develops within a company, the less likely they are to take their business elsewhere.

. Failing to focus on target markets. Marketing strategies should target specific audiences. If your business is trying to increase its base of health care clients, investing significant advertising dollars in real estate publications would be inappropriate. A more effective strategy might be to create relationships with health care executives, through trade groups, social activities or a direct mail program. Every marketing dollar spent should have a designated purpose and further business development goals. Activities that fail to support those goals should not be pursued.

. Indulging in design excess. Some businesses spend a lot of money on a wide variety of marketing materials. They are slick. They are four-color. They look expensive. Unfortunately, when the materials are put side by side, there is no indication that they come from the same company. A consistent graphic design on all marketing materials creates an image. It provides a recognition factor. Consistency builds awareness. Inconsistency creates confusion.. All factors in a corporate identity—typeface, type size, color(s), placement and graphic elements—need to be monitored to ensure the integrity and consistent application of the design.

. Putting all marketing dollars into “one basket.” There is a basic concept in education: Every child learns in a different way. Some children learn best by reading, others are more inclined to learn through role playing or video presentations. Still others learn through one-on-one tutoring. Those learning patterns continue into adulthood. That means companies must employ a variety of strategies and tactics to reach a targeted audience. Reliance on only one tactic, such as advertising, will reach only a small portion of a target market. A variety of tactics not only reaches a greater proportion of a market, it tends to reinforce key messages on multiple occasions.

. Failing to evaluate the effectiveness of marketing activities. If a marketing activity isn’t working, it’s time to try something else. Unfortunately, some businesses repeat the same activity year after year, without bothering to determine whether the activity is achieving the desired results. After an activity has concluded, or has been underway for a period of time, two types of measurement should be undertaken. The first is a determination of whether stated objectives have been accomplished. Since objectives are designed to be measurable, i.e. “To increase the company’s base of health care clients from five to 15 by the end of the Year 2000,” it is quite simple to determine whether they have been accomplished. Secondly, return on investment should be evaluated. This is both a tangible and an intangible cost-benefit analysis. For example, if an activity costs $20,000 to execute, but it has resulted in only $2,000 in business, there has been little tangible benefit. That might be an indication that a change in strategies and tactics is necessary. However, if the same activity has resulted in significant goodwill among prospects, positive media attention and introductions to a number of potentially lucrative referral sources, the intangible or unmeasureable aspects of the activity might significantly outweigh the costs.

When funds are tight, the marketing budget tends to be the first victim. That’s why it is more important than ever to find ways to maximize, not waste, those marketing dollars!

Top 10 ways to waste those marketing dollars!

Everyday, some company throws its marketing dollars out of the window. Not intentionally, surely. But it is wasting those dollars nonetheless.

Perhaps the company doesn’t understand marketing. Maybe it has no coordinated marketing effort, resulting in a laissez faire attitude (whomever grabs the marketing cash first gets to spend it). Sometimes, a business is poorly managed and the marketing department is simply out of control.

Whatever the reason, these businesses provide some good examples of what not to do when marketing. How do they waste marketing dollars? The first five of my list of the “top 10” money wasting techniques appears below.

. Operating without a marketing plan. If your company does not have a strategic business development plan, chances are, it is wasting marketing dollars. An effective marketing plan flows from one activity to the next, building momentum toward an ultimate goal. It focuses on the target and is not distracted by the millions of opportunities available to waste marketing dollars (charity events, golf outings, sponsorship ads, etc.). Yet, it is flexible enough to incorporate new tactics or take advantage of new opportunities that will enhance the overall marketing effort.

. Creating a marketing plan or implementing a marketing program without conducting research. If you don’t know where you are going, how are you going to get there? At the foundation of any effective strategic marketing plan is research. For example, a business may want to enhance its image and create a stronger identity in a certain marketplace. That requires a full understanding of the current image in that marketplace. A market study will reveal what factors affect the decision to use a business in a targeted market and answer questions such as what competitors are doing better or more poorly, and what marketing strategies will be most effective.

. Ignoring a marketing plan. Some companies have great marketing plans. They simply don’t follow them. Activities are not evaluated in terms of how they fit into the plan, but rather whether they are fun or will provide access to celebrities. Exceptions and exemptions will limit the effectiveness of a marketing plan: suddenly, the company is no longer moving forward proactively. They are reacting. Knee-jerk marketing has no lasting, cumulative effect. Only a focused effort will accomplish your business development goals.

. Failing to seek buy-in from the people the plan affects. The purpose of a marketing plan is to ensure that everyone is singing from the same songbook. Once a written plan is created, it must be communicated to all staff to gain their cooperation and support.

. Ignoring customer retention. A significant focus of any marketing program should be customer retention. Not only is it important that customers feel appreciated, it is also crucial that they are satisfied with your services or products. Vehicles such as surveys and follow-up interviews are essential to gauging customer attitudes. Even if negative information is elicited from an interview, wouldn’t you rather have a chance to correct the problem before you lose the customer?

Next week: The other five ways to waste your marketing dollars!