Trailblaze & Grow Category: ROI

Pivot Hard: Why Decisiveness Leads to Better Partnerships

As a CEO or founder, you have spent years working long hours to make your company a reality. Subsequently, you know the ins and outs better than anyone else, which is why it can be hard to fully rely on your newly hired consultant.

After hiring an outside specialist, it is natural to feel like it will take at least several months to get him or her up to speed before you can trust any input and advice. However, a lengthy waiting period can prove to be a detrimental mistake.


Act Now

Do not doubt yourself. If you are confident in your hiring decision, then the consultant will have valuable input and advice on day one. The ideal hire should come with an impressive pedigree and demonstrate the ability to spearhead marketing strategies that drive results. Your job is not to question the value of these strategies; it is to determine whether they are feasible to undertake with your company’s resources.

There are high risks when it comes to waffling and keeping all available strategies on the table. Either a competitor can beat you to the punch, or you can end up losing valuable time. In some cases, you might completely miss the boat on a marketing opportunity.


Here are three situations that can be avoided by being more decisive:

1.  Driving in the Slow Lane
It is quite common for clients to spend some time debating the positioning strategies that we recommend. In one instance, however, a client went overboard. In the time it took the client to think over our suggestions, the competition got a ton of media coverage and made waves while our client was left in the dust. Three years later, the competitor enjoyed a phenomenal exit. In the meantime, our client was in the process of pivoting to a new market.

Consultants use their expertise to pick the strategy that best aligns with the goals of your company. There is nothing wrong with thinking things over, and it is critical to fully understand how to implement the strategy. At some point, though, you will have to trust your consultant’s recommendation.

2.  Time Well Wasted
In a particularly memorable instance, a client was not hitting its numbers, so the company decided — against our recommendations — to replace its SEO agency. When the client transitioned, traffic began to plummet, and the downward trend only continued as the remaining individuals spent more time on fire drills and finding ways to look busy and valuable.

Afterward, we were able to use data to illustrate that the failure came from the affiliate program. The client needed to reallocate resources, and it took three months for us to regain the SEO losses. Initially, the company balked at our advice because we had not yet gained an understanding of the intricacies of its organization. What the client failed to realize, though, was that metrics-based business decisions remain consistent regardless of the organization.

3.  Missing the Boat
When opportunities come knocking, be ready. We had a client prepped for an opportunity to appear in The Wall Street Journal. When the business leaders got involved, they decided to change the direction of the story to what they thought would be “something more interesting.” After the change, they stalled and demanded a “better” reporter, and they refused to answer questions they thought were uninteresting. Following a few interviews, we lost the feature article, and the reporter moved on to a different story.

Throwing away an opportunity because it is not perfect is like sabotaging your big break before it even starts. Keep in mind that opportunities are rarely perfect, so take the ones that come along and use them to their full extent.


Trust your consultant. After all, you made the decision to hire him or her. However, blind trust can be just as harmful as a lack of trust. To avoid this, ask for data and qualitative backup for recommendations, and stay in the loop. While it is tempting to think you can gain amazing insights on your own by reading 800-word articles online, your consultant has a thorough knowledge of his or her expertise area. And you know your company best. With those powers combined, you may be pleasantly surprised by what you can achieve together.

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Photo by Nicholas_T on / CC BY

The CMO as Your Growth Partner

Ultimately, the people at the helm of your company make or break your organization’s strategic abilities.  If what makes a CEO shine is growth, then your CMO is your partner in crime. Their input will be essential to the broad challenges that you will face: competition, innovation, and core customers. Also, few have a better feel for the end-user/consumer pulse than the marketing executive – their relevant and refined perspective on customer preferences will play a vital role in your company’s growth.

In today’s economy, the CMO is at the crossroads of growth and customer experience. CMOs are increasingly seen as a director of growth and customers, rather than the director of spending and advertising, worldwide. The CMO role has changed from working exclusively on brand communication and messaging to driving impactful growth and cultural change. Marketers not only need to funnel customer intelligence into all parts of the business; they also need to keep up their technological proficiency, utilize big data to create meaningful customer interactions, and deliver value within a consistent brand experience.

While CMOs need to be part of the key decision making, they also need to partner closely with your CFO part of the key leadership.  It’s important that your CMO partners with chief financial officers to help them contribute to top-line growth and position themselves for a seat at the board table.  Together, they can steer the ship responsibly.

A strategic focus on return on investment, coupled with the rise of customer centricity and acquisition allows for CMOs to achieve measurable value within the organization. In fact, the CFO and CMO should be working hand in hand to increase accountability and reduce inefficiency — the CFO’s role is greatly enhanced by today’s savvy marketer as they are often the most resourceful person on your team.

Change the way you work with your CMO. Both CEOs and CFOs stand to gain tremendous insight at the ground level and meet the growing customer expectations. The role of the CFO is also becoming more multifaceted so work closely with your marketing person to help your organization survive and thrive in this increasingly competitive landscape.

How to tell a good CMO from a successful one? The latter hone the ability to think long term, adapt quickly, and pitch in with the team. They are able to shift from focusing on growth to a ‘big picture’ mentality. Thus, your CMO should not only influence decision-making but be able to make the tough calls, embrace uncertainty, and put relevant issues in front of the board to consider. This focus on vision makes a difference. Consider opening a conversation about bringing your CMO to the board room and see how they can deliver even more value as your strategic partner in crime.

Want to chat about this topic? I’m speaking at the NASDAQ Entrepreneurial Center in San Francisco on Thursday, June 30th on Marketing through the Funding Lifecycle.

Save Time

Analysis to Help You Stop Wasting Valuable Time

How useful would it be for you to know exactly where your time was best spent? How would it improve your productivity if you could quickly and reliably determine which customers were most lucrative for your business, and which ones were costing far more than they were worth holding on to? Fortunately, the ability to determine exactly that was established more than 100 years ago.

Back at the dawn of the 20th century, an Italian economist realized that he could mathematically calculate the fact that 20% of Italian citizens owned about 80% of the nation’s wealth. This equation proved to be valuable in analyzing far more than just the wealth distribution in Renaissance Revival-era Italy. In fact, the so-called “Pareto Principle” has been (and continues to be) used as an effective method of measuring distributions of wealth, effort, sales productivity, and countless other applications. This is because there is a fundamental truth — what some might call a philosophy — associated with the 80/20 equation discovered by Vilfredo Pareto.

What is the fundamental philosophy of Pareto?

At it’s core, the philosophy of the Pareto Analysis is based on an understanding of the fact that a relatively small percentage of input is responsible for a significant amount of the output. More specifically, that 80% of output can be attributed to 20% of input. This, of course, works when analyzing wealth distribution (as it was originally used by Pareto), but it also works in a number of other applications as well.

Perhaps the most compelling application — at least in our entrepreneurial and capitalistic society — is use of the Pareto Analysis when assessing productivity. More specifically, an entrepreneur, or salesperson, can usually attribute about 80% of their profit (or sales volume) to about 20% of customers. On the other hand, about 20% of customers often take up about 80% of the bandwidth available to an entrepreneur or a sales team.

The Pareto Analysis can be applied to any number of things:

  • Customers – both the time demands and their profitability
  • Daily tasks – where your time is spent productively and unproductively
  • Wealth – where the majority of your wealth is coming from, and where the majority of your expenses are derived
  • Anything else you can think of!

Using Pareto Analysis to become more productive

In order to use Pareto Analysis effectively, you must first be willing to accept a couple of facts: The first is the fact that some of your clients or customers may not be worth your time. Even if they are paying you what seems to be a valuable amount, the reality is that the opportunity costs associated with highly-demanding clients may be preventing you from gaining more worthwhile (in the long term) clients. The second thing you must be willing to accept is all work is not equal.

Not all clients are worth keeping. Many businesses, particularly those that are just starting out, are reluctant to turn down any work that comes their way. After all, money is money, right?

In fact, taking on a client that continues to be unprofitable or is demanding a disproportionate amount of your company’s time can ultimately prevent you from developing new, more profitable business elsewhere. You can use the Pareto Analysis to determine which clients are taking a disproportionate amount of your time (so you can try to phase them out) while also helping identify which clients are producing the vast majority of your revenue (so you can nurture and grow those clients as well).

Some of the work you do isn’t worth the effort. The bottom line is that you simply cannot do everything, and you certainly cannot do everything well. As such, you should use the Pareto Analysis to determine which specific aspects of your day are producing the majority of benefit, then work to eliminate or delegate/outsource anything that does not fall into that category.

Try using the Pareto Analysis yourself, and see if you can make your day more productive by eliminating the time consuming, unproductive tasks and focusing on the high-yield tasks.

Social Media Advertising

Is Advertising on Social Media Worth It?

Social media advertising has become a multi-billion dollar industry over the past couple of years. According to recent reports, social media ad spending came in at around $2.9 billion in 2014, representing about 58% growth over 2013. Clearly, many companies believe that advertising on social media is, in fact, worth it and there are a number of reasons why this is the case. The following are four of the most prominent reasons why social media advertising is growing in popularity:

Great ROI Compared to Traditional Advertising Platforms

Most industry experts agree that social media advertising offers a fantastic return on investment. The real challenge is determining how one wants to quantify that return. For example, obviously clicks and sales conversions are important metrics, but what about brand awareness? Brand awareness is sometimes the primary reason for an advertising campaign, yet there aren’t any reliable metrics to determine how much brand awareness an advertising campaign produced. That being said, most consider the cost per thousand impressions, or “CPM”, to be a reliable metric of cost-effectiveness, particularly with regard to brand awareness.

Globally, the cost to reach one thousand impressions is around $0.75, according to Facebook. However, that number varies wildly depending on the region, industry, and a number of other factors. That being said, this cost is a dramatic reduction compared to other advertising platforms, which could typically be as much as one hundred times more expensive! However you look at it, social media advertising provides an almost unparalleled return on investment when utilized properly.

Highly-Targeted Advertisements

In addition to being more cost-effective, social media advertising can be much more highly targeted to the right audience. Thanks to the wealth of personal information contained on social media platforms such as Facebook, advertisers are able to target as narrow of an audience as they’d like. Everything from geographic location, age, marital status, interests, diets, and income can be filtered for in an advertising campaign. Advertisers can even choose distinct campaigns for different targeted groups, further increasing the potential ROI of a social media advertising campaign.

Real-Time Analytics

Unlike traditional advertising platforms, such as television or newspapers, social media advertising provides real-time information on the effectiveness of a campaign. Advertisers can see precisely how many impressions, clicks, and conversions each ad has generated and can adjust strategies accordingly. This also means that the number of dollars invested in a campaign can be increased or decreased on a minute-by-minute basis.

Ability to Change the Campaign at Any Time

Along with the ability to gauge the effectiveness of an advertising campaign in real-time, social media advertising can be changed mid-campaign. In fact, one of the best ways to conduct a social media advertising campaign is to have small “experimental” campaigns running, designed to test the effectiveness of each campaign. Experimental campaigns that prove to be effective can then receive the most significant percentage of the overall advertising budget.

At the same time, the effectiveness of each social media campaign can (and should) be constantly monitored for effectiveness. Advertisements that prove to be less effective can then be replaced by “experimental” ads that have proven to be effective in their smaller trials. This is just one example of how real-time information, in conjunction with the ability to change a social media advertising campaign at any time, can facilitate a more robust and effective advertising strategy.

Without a doubt, social media advertising is an effective way to reach a highly-targeted audience. Whether or not it is right for your company depends on your marketing and advertising goals.


Photo credit: mkhmarketing / Foter / CC BY