How Metrics Help Your Sales and Marketing
28th September 2020
There are a variety of ways that metrics can help drive decisions for your business. Of course, being in touch with your finances (‘How Metrics Help a Business’) will be something you think of when you talk to your accountant. That’s not the only way they can help though.
So, let’s take a look at a sales and marketing case study, and how some simple metrics can help a business increase their profits without the need to increase their marketing spend.
Do you need to spend more to grow?
Simon runs an app development company. The business has been doing really well, and he and his management team are now ready to take their growth to the next level. One of the ways they’re considering doing this is through their marketing, so they’ve been looking into the monthly investment they make in this area of the business.
They know that they currently spend £10,000 per month on marketing, which covers:
- Paid advertising (using Facebook and Google)
- Sponsorship of the local cricket club
- Networking meetings
- Email marketing from their CRM system
Their figures show that with new orders each month adding up to £15,000, their monthly return on investment for their marketing spend seems pretty good.
Because of this, they’re thinking that to grow the business an increase in marketing spend seems a logical strategy. But, before they head off in that direction, Simon gives us a call for some advice as to whether this is indeed the best option, or whether they could generate growth in other ways.
Looking at your sales and marketing metrics
We started by sitting down with the management team and doing some price modelling. This helped them to see if there were other ways to create growth without the need to spend more. Finding ways to tweak and maximise what’s already working well, is one of our primary aims when working with our clients.
During the session we showed them how to look at their spend per customer, and the ways that a price increase might positively impact their bottom line. They had been nervous about a price rise in this competitive market, but they could see exactly what an increase would do for them and their customer base, so they decided on a modest increase.
With a reasonable return on their marketing investment, we also spent time looking into which activities performed best. This is key marketing information that all businesses need to know, to help ensure you’re focusing your efforts and spending your budget in the best way possible.
Of all their marketing activities, Google ads gave them their best return on investment, so we adjusted their spend ratio to maximise on this.
Making the most of happy customers
We also noticed that a lot of their income came from repeat customers. Marketing to existing customers is far easier and more economical because they’re already fans and fully aware of how good your product or service is. So, we encouraged them to focus on this by looking at their customer follow up systems and find ways to create a win-win for them and their customers.
To achieve this, they introduced incentives for existing customers like, ‘referring a friend’ or writing a review to receive a gift voucher. These types of incentives are a really inexpensive way to keep your existing customers happy and to introduce new customers to your business through recommendations.
The time we spent looking in detail at what, where and how Simon’s company was marketing their services, meant they were able to make simple adjustments to their existing activities. These adjustments allowed them to increase their profits and grow the business, without the need to increase their marketing spend.
What you can see from this case study is how, with a a focus on the right information, you can make adjustments to existing strategies that maximise your results. Simon and his team now know exactly where to aim their marketing activities and how to retain their customers in an inexpensive but win-win way that keeps existing customers happy and encourages new customers through the doors.
If you’d like to have a chat with us about how we can set up pricing and marketing metrics to help grow your business, contact us now.