Avoid These Pitfalls to Get the Most Out of Your Marketing Consultant

As a founder, you have spent years working long hours to make your company a reality. You know the ins and outs better than anyone else. While it is tempting to think you can gain amazing insights on your own by reading 800-word articles online, you will eventually need to turn to experts to augment knowledge gaps. Engaging a consultant with thorough knowledge of his or her expertise area can help you achieve results.

However, it can be hard to fully rely on your newly hired consultant. 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.

Avoid these four pitfalls to get the most out of your consultant:

  1. Driving in the Slow Lane
    It is common for clients to spend some time debating recommended strategies. However, there are risks to keeping all available strategies on the table for an extended time. 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. At some point, though, you will have to trust your consultant’s recommendation.

    In one instance, 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.

  2. Missing the Boat
    Be ready when an opportunity is knocking. Keep in mind that opportunities are rarely perfect, so take the ones that come along and use them to their full extent. Dismissing an opportunity because it is not perfect can sabotage your big break.

    For example, we had a client prepped for an opportunity to appear in The Wall Street Journal. With the opportunity in hand, the business leaders stalled and decided to pivot the direction of the story to something that they thought would be “something more interesting.” Against our advice, they refused to answer questions they considered uninteresting and demanded a “better” reporter. Following a few interactions with our client, the reporter moved on to a different story. We lost the feature article.

  3. Blind Trust
    You made the decision to hire your consultant so trust him or her. However, blind trust can be just as harmful as a lack of trust. There is nothing wrong with thinking things over, and it is critical to fully understand how to implement the strategy.

    Consultants use their expertise to provide recommendations that best aligns with the goals of your company. Your job is not to question the value of recommended strategies; it is to determine whether they are feasible to undertake with your company’s resources. You know your company best. Ask for data and qualitative backup for their recommendations, and stay in the loop.

  4. Jumping to Conclusions
    In a particularly memorable instance, a client was not hitting its numbers. The company quickly decided 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 their marketing programs. What the client failed to realize, though, was how to pinpoint the necessary data to make metrics-based business decisions.

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. With your combined knowledge, you may be pleasantly surprised by what you can achieve together.

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Categories Leadership, StrategyTags , ,

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 has 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 boardroom 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.

Categories Marketing, Operations, StrategyTags , , , , , ,

Best Marketing KPIs to Track Your Business Success

As marketing has become more advanced and targeted, it has also become increasingly important to understand the specific metrics with which effective marketing is measured. These metrics, more commonly known as KPIs (key performance indicators), are a powerful way to determine which marketing tactics and strategies are most effective. Used properly, they can dramatically improve your marketing tactics.

Digital marketing has quickly become the driving sector in the overall marketing industry. This is largely thanks to the fact that close to half of the world population, or about 3 billion people, now use the Internet on a regular basis. As a result, it should come as no surprise that many of the most important KPIs involve the Internet and digital marketing in one way or another.

While each business will have different KPIs, these are some of the most important marketing ones to pay attention to:

  1. Cost per lead
    Understanding how much it costs to acquire a lead is as important for a startup company as it is for a well-established corporation. If nothing else, understanding what makes the cost per lead increase (or preferably, decrease) can be a powerful marketing tool that improves profit margins. Beyond that, however, understanding what it costs to acquire a lead can be used as the basis for understanding whether or not a marketing campaign is a worthwhile investment or not.
  2. Ratio of leads to qualified leads
    One of the greatest advantages of digital marketing is the ability to highly target leads. In fact, if you are not targeting leads on a particularly granular scale, you are all but certainly wasting marketing resources in an inefficient marketing campaign. One of the best ways to determine whether your marketing campaign is appropriately targeted is by comparing the ratio of total leads to qualified leads, and ultimately the ratio of each of those metrics to an overall conversion rate. A small number of high-quality and highly-targeted leads are significantly better than a massive number of unqualified leads.
  3. Return on investment
    Return on investment, or ROI, is as important in marketing as it is in many other aspects of business. With marketing, ROI is used to determine which marketing tactics and strategies are most effective (as well as which ones are not), and can have a substantial impact on determining which marketing strategies will be used moving forward.  In the subscription world, you’ll pay closer attention to customer acquisition cost, or CAC.
  4. Customer lifetime value
    The lifetime value of a customer is a bedrock metric for any business, and it can help determine the marketing framework as well. Ultimately, understanding that the lifetime value of a customer is particularly high (for example) can help to justify the upfront costs of qualifying leads and then acquiring them. On the flip side, a low lifetime value might mean the marketing campaign needs to be as streamlined and bare-bones as possible. In the subscription world, you should be tracking the churn rate (or retention rate if you want to keep a positive mindset) and the average monthly revenue per customer to calculate LTV.
  5. Net Promoter Score (NPS)
    The Net Promoter Score is based on the theory that customers who are strong proponents of your company are highly valuable. These “loyal enthusiasts” are a powerful source of referral business, and can be a major factor in the long-term viability and health of a company.

    The NPS theory can basically be boiled down to this: customers who rate their overall experience with your company a “9” or “10” out of 10, are likely to be “promoters”, or customers who will dramatically improve a number of KPIs, including cost per lead (thanks to free referrals), lifetime value of a customer (thanks to loyal repeat customers), return on investment (again, thanks to the long-term value of customers), and numerous others.  While it might seem difficult to attain a 9 or 10, the reality is that anything lower (7-8 is considered “passive” and 0 to 6 is considered a “detractor” rating) will not be beneficial to one’s business.

The Net Promoter Score, along with the rest of the KPIs listed above, can and should be used to measure the strength or weakness of your marketing campaign. You can rest assured that your competitors are doing the same.

Categories Marketing, StrategyTags , , , , , , , , ,

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.

Sources:
http://www.convinceandconvert.com/social-media-research/15-new-facebook-advertising-statistics/
http://marketingland.com/first-half-digital-revs-23b-mobile-social-grew-104542

Categories OperationsTags , , ,