Marketing monitoring and evaluation guide for small business

3/05/2015

MONITORING and EVALUATION Module 5 – NURTURE HOWTO Market My Small Business

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In this section +  MONITORING AND EVALUATION +  WHY IT’S IMPORTANT

+  COMPETITOR RESPONSE +  ROI AND COST PER LEAD/ CONVERSION

+  GOALS & OBJECTIVES

+  ROI TIPS AND TEMPLATE

+  SMART MEASURES

+  LEARN AND EVOLVE

+  EVALUATION MEASURES +  BASELINE OR BENCHMARK DATA +  SALES STATISTICS +  ASK +  CHECK YOU’RE REACHING YOUR TARGET MARKET +  MEASURE DIGITAL AND SOCIAL MEDIA +  TRACK MENTIONS

HOWTO Market My Small Business

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3/05/2015

M O N I T O R I N G & E V A L U AT I O N +  It is critical to consider how you will monitor and evaluate the success of your marketing activities way back in the IDENTIFY stages +  You will need to monitor and evaluate your progress throughout all stages – but as this is the last stage in the process I wanted to reiterate this process before finishing +  You shouldn’t embark on any activity without having this in mind +  Build into the HOWTOMARKETINGTM Master Marketing Strategy template you would have chosen specific goals, objectives but also evaluation measures in your action plan +  You need to track these on a regular basis +  TRACK EVERYTHING – click rates, sales, enquiries – this can be largely automated – generate reports and analyse them

W H Y I T ’ S I M P O R TA N T +  When it comes to marketing, you can be the most brilliant and creative strategist but it may all come to naught if you don’t monitor and evaluate your results. +  Monitoring and evaluation of marketing campaigns and tactics is one of the most overlooked components of any marketing and communication strategy. +  It is also one of the most important aspects. You need to know your money is well spent, especially when marketing dollars are hard to come by. You need to know what works, what doesn’t work and what can be improved? +  It can be hard to prove a direct link between marketing activities and results. You may have implemented a fantastic new advertisement in your local paper and sales around the same time increased by 10 per cent. Can you argue there is a direct link between the two? Yes and no. +  There are definitely sophisticated marketing metrics and tools available that can help you determine cause and effect. Larger companies have the resources to put facts and figures to what are often intangible results. +  However smaller businesses should not despair.

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IDENTIFY MARKETING OBJECTIVES

I D E N T I F Y S M A RT M E A S U R E S

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S A M P L E E VA L U AT I O N M E A S U R E S Anecdotal feedback ANendance Award wins Backlinks (quanRty) Bookings Brand awareness Brand recall Changed behaviours Click rates Content shared DonaRon levels Downloads (quanRty) Formal feedback

•  •  •  •  •  •  •  •  •  •  •  •  •

•  Inﬂuence policy or decision •  Lead conversion •  Listeners •  Market share •  Media coverage •  Number of enquiries •  Open rates •  ParRcipaRon rates •  RelaRonship management •  Repeat sales/visits •  ReplicaRon of key messages •  ReputaRon management

•  •  •  •  •  •  •  •  •  •  •  •

Reviews Sales Search engine rankings Social media engagement Speaking opp requests Spokesperson requests Store traﬃc SubscripRons Useage rates Viewers Web bounce rates Web traﬃc

H AV E B A S E L I N E O R B E N C H M A R K D ATA

+  Before you start your marketing activity it is a great idea to find out what existing benchmark or baseline data you already have, so you can easily compare before and after performance. +  This data does not need to be that sophisticated if you don’t have it already. It can be anecdotal even. +  For example if you are hoping to increase customer enquiries by 20% over six weeks by implementing a particular marketing activity, you need to know what the level of customer enquiries were before you implemented the activity. +  If you don’t have hard data from statistics collected or ‘Contact Us’ emails, speak to people who do have a clear idea. Frontline staff and sales reps can give you informed opinions and anecdotal evidence. If you have time before you start your marketing, ask them to collect some data over a period of time, even if it is just a week

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S A L E S S TAT I S T I C S

+  Even if your marketing objective isn’t specifically to increase sales, it is still an indicator of whether a marketing activity might be having an effect. +  Your marketing objective might be to increase awareness of your organisation, but certainly sales could be a flow-on benefit. +  Sales can be measured by new leads generated and converted sales, number of customer enquiries and bookings, customer referrals and billable hours. +  Be aware though of any peaks and troughs in your business and any other promotions underway, as well as your sales life cycle when measuring sales. +  You don’t want to be misled into thinking your sales have increased suddenly by 20% in one month, when historical sales data says it always increases at that time of year.

ASK!

+  Ask your customers, staff (especially frontline staff) and stakeholders if they heard/saw/responded to your promotion. Ask them for feedback and suggestions, all of the time. +  Do this formally via a questionnaire or survey. Free on-line survey tools such as Survey Monkey are really useful and can collate data for you. Use the same questions in your survey and repeat it at another time so you can have baseline data. +  Use ‘How did you hear about us?’ questions in Contact Us forms on your website and a drop down list of options such as ‘local newspaper, Google, a friend (please specify your friends name so we can thank them)’. Keep the drop down options up-to-date as you introduce new promotions. If you don’t have one of these on your website yet, get one. +  Also get your staff to ask the question ‘How did you hear about us?’ verbally whenever they hear from a new customer. They should also keep a record of the customers’ responses.

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C H E C K Y O U ’ R E R E A C H I N G Y O U R TA R G E T M A R K E T +  Let’s say your target market is 30 to 40-year-old mums, but the majority of people engaging with your marketing activity are 21-year-old university students. +  With this information you need to reevaluate how to reach your target market and whether it may be worthwhile targeting a new market segment or not.

M E A S U R E Y O U R D I G I TA L A N D S O C I A L M E D I A +  Use free analytics and other built-in tools such as Facebook Insights, and Google Analytics – where you submit your site to google for tracking +  You can gain valuable profiles of the people engaging with your site and how they are interacting. +  If people are liking it, viewing it, sharing it or commenting, you also know your social media efforts are working. +  Track website hits/click-throughs, (your website provider should be able to provide this type of data), e-newsletter subscriptions, number of people engaging in your social media platforms (notice I use the word engaging rather than number of followers, which sometimes can be overrated if those followers aren’t actually engaging with content).

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TRACK AND MONITOR MENTIONS +  It is very useful to monitor mentions of your brand name, and reproduction of your key messages across all media including social media. +  You can set up free Google Alerts to track mentions on the internet. +  You can check for reviews about your company on on-line directories, and review sites. +  Monitor media such as your local newspaper and radio for mentions and record whether it was positive or negative. +  If you are expecting a lot of media coverage from an activity, consider engaging a media monitoring service.

COMPETITOR RESPONSE +  It’s always a good idea to monitor what your competition is up to and if all of a sudden they start mimicking your marketing activities, you could reasonably deduce you may be making some serious cut-through. +  Remember imitation is the highest form of flattery.

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C A L C U L AT E R E T U R N O N I N V E S T M E N T +  Know how much you have spent on your marketing activities. +  You need to consider all costs, such as advertisement rates, printing and design costs, but also consider labour costs (hourly rates including your own), additional resources and equipment required to make your marketing activity happen. +  Compare your costs to how much money (sales revenue and profits) you think can be attributed to your marketing activity and present it in a dollar term to see if it is worth it.

COST PER LEAD/CONVERSION +  I’m going to explain a formula that enables you to allocate a dollar amount to how much it costs to get a new lead and convert a lead. +  This also helps you to identify the proportion of leads you're converting. +  Once you know these figures you can easily set yourself a benchmark and then regularly monitor and measure your success against the figures. +  Your overall aim is to increase the proportion of leads vs conversions, overall number of conversions and decrease the dollar figure per conversion. +  Once you know what dollar figure per customer you're targeting you can also set yourself more realistic marketing budgets. +  Some software programs and analytics programs have built in functionality to measure specific campaigns and their contribution to leads and sales, but this is mainly for online marketing activities and sales.

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M A N U A L R O I C A L C U L AT I O N S +  You can manually calculate how much getting a customer costs when it comes to all of your marketing activities with the following formulas. +  You will need to choose a time period for calculating the following figures and apply it across all the formulas. You could choose a 12 month period, a month or the period of a specific marketing campaign. Marketing cost per lead (for X time period) = marketing costs (for X time period) / Number of leads (for X time period). Marketing cost per conversion or sale (for X time period) = marketing costs (for X time period) / Number of conversions or sales (for X time period).

MARKETING ROI +  You can take this a step further and calculate (from past sales data) the average value of each sale or new customer over the same time period and then calculate return on investment (ROI). +  If you have a type of business that typically holds onto customers for more than 12 months than calculate the average LIFETIME VALUE of that customer. +  Your marketing ROI is the total value of your new customers or new sales over the time period or lifetime value of your customers minus the marketing costs OR Marketing ROI = Sales revenue - Marketing costs (for X time period) Of course the above formula only considers revenue so it doesn't take into account other overheads that will affect overall profits but it does indicate the relationship between your marketing spend and sales. This is then another measure or benchmark you can use for future marketing campaigns and activities.

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NEW CUSTOMER ROI +  Finally you can calculate the Marketing ROI of each new customer by using the following formula: Marketing ROI of each new customer = (Sales revenue - Marketing costs)/ Number of new customers +  Finally you can also express Marketing ROI as a percentage with the following calculation: Marketing ROI % = ((Sales revenue - Marketing costs)/Marketing costs) x 100 +  The percentage figures can seem a little on the high side but they once again will show the correlation between marketing spend and sales.

S A M P L E C A L C U L AT I O N S +  ANNUAL MARKETING COSTS $10,000.00 +  NUMBER OF (TARGET) LEADS IN YEAR 1000 +  NUMBER OF (TARGET) CONVERSIONS IN YEAR 300 +  MARKETING COST PER LEAD

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+  MARKETING COST PER CONVERSION (CUSTOMER) $33.33 +  AVERAGE VALUE OF EACH NEW CUSTOMER OVER 12 MONTHS (SALES REVENUE) $500.00 +  TOTAL VALUE OF NEW CUSTOMERS OVER 12 MONTHS (SALES REVENUE) $150,000.00 +  OVERALL MARKETING ROI AFTER 12 MONTHS $140,000.00 +  ROI OF EACH NEW CUSTOMER AFTER MARKETING COSTS OVER 12 MONTHS $466.67 +  MARKETING ROI% 1400.00%

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T I P S A N D T E M P L AT E +  TIP: The above formulas are great for measuring marketing activities and their success but in business you also need to take into account your overall profit margins, so you may wish to ALSO deduct other overheads (NOT just marketing costs) when calculating ROI figures. This will enable you to make sure your marketing activities are well within budget. +  Attached to this module you will find an ROI calculation template you may wish to use

L E A R N A N D E V O LV E +  Take on board what you have learnt from your monitoring and evaluation. +  What’s working? +  What’s not? +  How can we improve? +  And remember it is an evolving process. The same thing won’t necessarily produce the same results forever. +  Stay innovative, don’t be scared to try something new, but make informed and calculated risks when it comes to marketing. +  MOST OF ALL HAVE FUN! +  DON’T FORGET TO JOIN Kylie’s Howto Marketing Facebook group +  Stay tuned for more great products and courses you may be interested in

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3/05/2015

In this section +  MONITORING AND EVALUATION +  WHY IT’S IMPORTANT

+  COMPETITOR RESPONSE +  ROI AND COST PER LEAD/ CONVERSION

+  GOALS & OBJECTIVES

+  ROI TIPS AND TEMPLATE

+  SMART MEASURES

+  LEARN AND EVOLVE

+  EVALUATION MEASURES +  BASELINE OR BENCHMARK DATA +  SALES STATISTICS +  ASK +  CHECK YOU’RE REACHING YOUR TARGET MARKET +  MEASURE DIGITAL AND SOCIAL MEDIA +  TRACK MENTIONS

HOWTO Market My Small Business

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Good luck on your marketing adventure!

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