Two Approaches to Planning your Marketing – Part Two

Last week I talked about how this blog was inspired by a discussion on LinkedIn and then discussed the pros and cons of working to a number given to you by the CFO or accountant.  This week we start from the opposite direction and will be going back to the accountant with a required figure.

Pros of starting with the planning

  1. You consider all possible activities except those you know that will have outrageous costs attached, such as TV advertising
  2. You’re considering what activities are most likely to deliver the best return in investment, especially if you have done them before and have the evidence to support your thoughts.
  3. It is more likely to be flexible, especially when you start achieving your business targets
  4. It is led by the business’ needs, not those of the accountants!
  5. Depending upon the perceived ROI you have an opportunity to re-visit your budget and decide to spend more.
  6. Far better to work down from the “Gold Standard” than work up
  7. If more money does become available, you’ll know exactly what to do with the money

Cons

  1. There is a chance you will spend more than the accountant wants you to
  2. You’ll have to make sure you track the results so justify yourself to your accountant/CFO
  3. It takes a bit longer
  4. You get to argue (sorry – put your point across) with the CFO – is this really a con?

Marketing is all about demonstrating the value you can provide to your customers in order to tempt them into buying from you. It should therefore be the same within the company.  The activities/campaigns in the marketing plan need to show value to the wallet holders in order to be authorised.

Its fairly obvious on what side of the fence I fall, but then again I’m a marketer and not a finance geek.  I hope this has been useful to you and I look forward to your comments.

 

Two Approaches to planning your Marketing – Part One

Planning your Marketing – Part One

This was inspired by a recent discussion on LinkedIn that asked how people tracked their sales opportunities. It seems a large number of homeworkers use Excel as their main tool, as it is simple to use and most people will have it anyway as part of Microsoft Office. One person then asked if anyone used Excel for marketing planning.

Being the generous and helpful person I am, I asked if she would send me her spreadsheet so I could see if there was anything that could be done to make it a better tool for her.

Cramming all functionality onto one worksheet is always going to make things a little difficult. A quick exercise into separating out the functionality into multiple worksheets (budget, actual spend, tasks etc.) allowed a much clearer picture of what is happening/needs to happen and the performance of her marketing.

I will be following up in a couple of months to see what has happened.

Anyway onto the main subject – Marketing planning

There are two ways to approach your marketing planning and your budget planning:

  1. Start with a budget number and work down until you’ve planned to spend all the money you have available – discussed today
  2. Work out the activities you need to do in order to achieve your goals for the year.  – next week

Nearly two fifth’s of SME’s have a budget of less than £10,000 for 2012[1] so it is vital that the budget is used wisely so lets look at the pros and cons of the different approaches above.

Pros of starting with a budget number

  1. it makes sure you don’t exceed your budget
  2. your CFO/accountant knows what they need to put aside each month

Cons

  1. This approach doesn’t take into account your business goals
  2. You may miss out marketing activities that could give greater returns simply because your budget has run out
  3. It is more likely to encourage you to do low cost activities rather than high value ones
  4. It is likely to be inflexible, even if more revenue starts to come in regularly
  5. You’re letting the accountant win!

Next week we’ll look at an alternative approach; that of doing the planning and then discussing it with the numbers guys to see what can be agreed. As much as we’d all love to simply carry out the plan, the accountants sign the cheques usually and you can spend the money if they aren’t going to sign!


[1] http://www.b2bcm.co.uk/index.php/UK_Telemarketing/uk-smes-embracing-digital-and-social-platforms/