Presentation on theme: "Www.scoresewisconsin.org Creating a Basic Actionable Marketing Plan Presented by SCORE SE Wisconsin January 12, 2013."— Presentation transcript:
www.scoresewisconsin.org Creating a Basic Actionable Marketing Plan Presented by SCORE SE Wisconsin January 12, 2013
www.scoresewisconsin.org What Does SCORE Do? “ Counselors to Americas Small Businesses” Provides quality, free and confidential counseling to small businesses. In person at a SCORE, neutral, or client locations. Telephone counseling Email counseling (new) Provides low cost workshops
www.scoresewisconsin.org SCORE SE Wisconsin Chapter 50+ highly experienced active volunteers with varying skills and talents. –Many have run small businesses. –Others have worked in banking, real estate, law, or for local corporations. Housed with the SBA at 310 W. Wisconsin Ave. (Blue Reuss building). Anyone wanting business counseling can call the SCORE Office (414-297-3942) or sign up on the SCORE Milwaukee website www.scoresewisconsin.org. www.scoresewisconsin.org
Selling Defined Persuade a potential customer your product or service solves their problem or fulfills their need(s). It can be face to face or indirect. It assumes: –Product service offering is competitive –Customer service is competitive –Sales organization is trained and motivated
www.scoresewisconsin.org Persistence in Selling Pays Off “On Average….. It may take six contacts to acquire a new customer….. 75% of all sales people quit after the fourth contact”
www.scoresewisconsin.org Sales Representation Defined Consumer –Internet Website Direct or Indirect (% plus delivery) Indirect (AA & Orbitz %) –Retail Direct Sale (Best) Indirect Broker, Distributor/Wholesaler (5%-10%+) Business to Business –Internet (Direct) –Direct Sale (Best) –Indirect (5% - 10%+) Distributor /Wholesaler Manufacturer’s representative
www.scoresewisconsin.org Profit Impact of Sales Channel IndirectDirect Business or Client$17.49 Cost 10.00 Gross Profit 7.49 %GP 43% Wholesaler/Distributor$10.00 Cost 8.50 Gross Profit 1.50 %GP 15% Your Business $8.50$10.00 Cost 5.50 Gross Profit 3.00 4.50 %GP 35% 45%
www.scoresewisconsin.org Marketing Defined Marketing is how you want your customers to view your business. It’s how you position yourself. –You and your employees (sales & customer service) –Your product or service offering –Your policies: Pricing, credit, warranties, service and returns –Location (more important if retail) –Advertising and promotion
www.scoresewisconsin.org What is a Marketing Plan? It projects your monthly and annual revenue It requires specific plans on how to improve your current market position.
www.scoresewisconsin.org Why Plan? “If you do not know where you are going, it does not make any difference on how you get there” Lewis Carroll from “Alice in Wonderland”
www.scoresewisconsin.org Planning Benefits It reduces uncertainty It identifies problems/opportunities needing action (and fast) It lets you sleep at night It saves you money!!!
www.scoresewisconsin.org Where Do I Start?
www.scoresewisconsin.org Begin With Your Monthly Reports
www.scoresewisconsin.org Allocate Revenue by Month Using Sales History Adjusted for Seasonality 1 Qtr Apr May Jun Net Sales Actual $ 156,711$ 43,379$ 53,990$ 43,608 % Change -6.5% 29.3% 99.8% 10.5% Gross Profit $s $ 61,056$ 16,549$ 18,713$ 16,776 % Margin 39.5% 38.2% 34.7% 38.5% Cum Sales$ 156,711$ 200,900$ 254,079$ 297,977 Quarterly Sales $ 156,711$ 140,977 % Change -6.5% 40.9% % Year 25% 23% Source: Monthly P&L
www.scoresewisconsin.org Analyze Your Sales Data!
www.scoresewisconsin.org Example: Average $/Sale and Customer Trend
www.scoresewisconsin.org What Does the Data Tell You? Increasing $/transaction is strong but not growing. Excellent job of trading customers up Improved product mix working well Increased service revenue working well Customers are disappearing! Why? Price? Product Lines? Competition? Promotion?
www.scoresewisconsin.org Price Reduction Impact on Profit Base-5%-10% Revenue$100,000$95,000$90,000 Cost of Goods -50,000 Gross Profit 50,000 45,000 40,000 Operating -45,000 Net Before Taxes $ 5,000 $ 0$-5,000
www.scoresewisconsin.org Target Market –Example #1 (Kitchen Remolding) Residential, suburban home ownership Generally affluent ($100,000 plus) Women are usually the decision maker Decision takes multiple visits/meetings/calls –Example #2 (Plumber or Electrician) Residential home ownership Decision usually within one or a few weeks –Example #3 (District School Boards) –Example #4 (Department of Public Works) Define your customers
www.scoresewisconsin.org Recap 1.Project sales revenue by month/quarter 2.Analyze your sales and customer data 3.Define problems/opportunities 4.Understand pricing dynamics 5.Select your target audience/customer base
Think Through Your Business Have I completed a competitive analysis of key marketing variables? What have I learned? What promotional techniques work in my business? Do I have sufficient funds for a continuity campaign? Do I need help? Most business do!
www.scoresewisconsin.org Customer Priorities NewEstablished Business 1-3/5 Years3/5 Yrs. Or More Primary Emphasis NewCurrent Secondary EmphasisCurrent New Promotion FundsReach out vehiclesLoyalty based Promotional $s HighLow
www.scoresewisconsin.org Create the Promotion Plan 1.Establish a budget (5% of net sales for example) 2.Current customers are more important than new customers: –They generate more income –They recommend new business –They are less expensive to promote
www.scoresewisconsin.org Reach, Frequency, and Recency A single exposure is reach, more exposures are frequency Multiple exposures (frequency) leads to awareness of the message Overcoming objections and persistence (frequency) is critical in personal selling
www.scoresewisconsin.org Changing Promotion Options * Traditional –Yellow Pages –Signage –Print Advertising –Press Releases –Direct Mail *Source HP Digital Options –Website –Social Media Twitter Face Book Google Plus LinkedIn You Tube –Targeted Advertising
www.scoresewisconsin.org Why Use Social Media? 1.Attract new business 2.Stimulate current customers to buy more 3.Create referrals
www.scoresewisconsin.org Benefits of Social Media 1.It’s considered free 2.Works like word of mouth (+/-) 3.Capable of targeted advertising 4.Widely used. It is a hot topic! 5.Provides reviews (+/-) 6.Changes quickly (+/-)
www.scoresewisconsin.org Social Media Time Commitments Frequent Updates –Twitter –Facebook Infrequent Updates –YouTube –Linkedin
www.scoresewisconsin.org Prioritize Spending 1.Website/E Mail-Consultant? 2.Social Media (if applicable) Consultant? 3.Yellow Pages (if applicable) 4.Advertising 1.Broad geographic area 2. Must have significant funds
www.scoresewisconsin.org Create or Update Your Web Site Web site for information & lead generation –Examples: CPA or law firm Business to Business –Web site for information & transactions –Examples: E Bay (listing of products) Restaurants providing reservations and discounts
www.scoresewisconsin.org Create the promotion plan Create a loyalty program –Requirements A computer database with customer name, address and e mail Create a simple rewards program: –Special sale for current customers (mail or e mail) –5% off future service and parts (Ford Motor Company) –20% off annual service plan for furnace inspection (HVAC) –Rebate for loyal customers (B2B performance based) –Cash back rewards (1% to 2%) from USAA and Fidelity
www.scoresewisconsin.org Current Customers Vehicles to contact customers –E mail (spam filter may block out) –Social Media –Direct mail* (cooperative funds) Post cards with coupons Flyers by name and promotional incentives –Signage and receipt/invoice: match competitor’s price (document rules) within defined period
www.scoresewisconsin.org Contacting Current Customers Prioritize by Area and Customer Profile Geographic area based on your database (80/20 rule) Examples: –Geography: by city: Oconomowoc, Delafield, Waukesha or zip code –Sales message: Clearance prices
www.scoresewisconsin.org Seeking New Customers/Clients Advertising-Excludes Internet –Concentrate in one medium (newspaper, radio, billboards, etc.). –Broad geographic customer base required –Frequency or continuity is more important than type of advertising (newspaper or radio). Several weeks required to create awareness –Buyer beware: Broadcast rates may be negotiated (newspaper excepted)
www.scoresewisconsin.org Seeking New Customers/Clients Consider the “Yellow Pages” if problem driven in addition to website. Targeted media for new users (internet promotional offers, personalized letter, newspaper inserts, flyers and direct mail, cooperative or single, by zip code) Create awareness: listing in associations, cross promote with non competitive businesses (see workshop packet), network, etc.
www.scoresewisconsin.org Seeking New Customers in an Industrial or Service Business
www.scoresewisconsin.org Service Oriented Business Message Reinforcements Create competence and credibility –Outstanding website –Through licenses –Through certifications and degrees –Inform customer of insurance coverage –Guarantee your work (in writing) and set milestones –Through references (with permission) –Industry experience and associations (BBB) –Disclose how adjustments or roadblocks addressed
www.scoresewisconsin.org New Customers for Service Business Direct selling using the telephone (cold calling), in person (cold calling) or letter (e mail) followed by call for appointment. Network (CC) and research through professional associations, trade shows, and internet (Linkedin). Contacts!!! Referrals! Follow up aggressively with potential clients/customers- but do not be pushy! Work on new business regularly
www.scoresewisconsin.org Managing the Marketing Budget Month 1Month 2Month 3 Revenue Estimate $45,000 $54,000 $44,000 Revenue Actual $38,000 $60,000 $48,000 Difference ($ 7,000) $ 6,000 $ 4,000 Budget at 5% $ 2,250 $ 2,700 $ 2,200 Budget Adjustment and Revision Adjust next month’s expenditure +/- based on past month sales $ 2,350 $2,500
www.scoresewisconsin.org You Plan Is Almost Complete
www.scoresewisconsin.org Review and improve the plan Allocate time to review the plan monthly –Adjust the budget based on results –Demonstrate patience in evaluating plans –Remember marketing includes more than just promotion –Learn from and act on experience Do not be afraid to experiment if it makes sense.
www.scoresewisconsin.org Small Business References www.score.org –National e mail counseling www.wctc.edu –Small business center www.matc.edu –Multiple locations throughout the county www.irs.gov –Tax references and PDF downloads
www.scoresewisconsin.org Continued www.dor.state.wi.us –Tax filings and revenue questions www.sba.gov –Reference center for small business www.bizstats.com –Business statistics and financial ratios www.mpl.org –Online databases and in person support