How to Increase Sales through marketing without going bankrupt

In my experience, many companies tend to go to extremes when it comes to marketing: they either don’t want to spend money at all, or they throw larges sums of money away on the same marketing strategies, whether they work or not.

In this article, I’ll discuss how to strike a happy medium to grow your business without breaking the bank.

There are a wide variety of opinions about how much of your overall budget should be spent on marketing.  I don’t like this approach, as I feel each business is different.  Rather than focusing on spending, say, 10-15% of your budget on marketing, a better question is: “where am I at with my business, and what are my immediate short and long-term goals?”  If the business is just starting out, and sales haven’t taken off yet, telling the new business owner to spend a thousand dollars on a direct mail or Facebook campaign might be like telling a bowler to run a marathon.  Furthermore, 15% of nothing isn’t going to be very effective.

On the flip side, a major corporation with a good reputation may find that they can accomplish their goals with a budget of much less than 10% of revenue.

The key to being effective lies in expanding your sphere of influence from where you are now to a higher level.  This new sphere of influence should be a definite, achievable goal.  Don’t count on “going viral” (but be ready in case it happens) to achieve success.  Focus on steady, demonstrable growth.  If the windfall comes, great.  If not, know you are on the path to success.  Your sphere of influence depends on how much attention you command from others.  In business, the best kind of attention to get is a reputation as an expert.  How much attention you command depends on establishing communication lines with as many people as possible.

The goal of marketing, then, is get people’s attention in order to extend your communication lines wider and wider; while simultaneously portraying yourself as valuable.

To extend your communication lines in an ever-widening sphere, one looks at how big the sphere currently is.  If you are new or small, your sphere of communication may be only 20 people.  Your first goal may be to build that sphere of communication to 100.  Thus, your marketing strategy should to geared at establishing good contact with 100 people.  Keep in mind, you may have to actually contact 500 or 1000 people to get 100 that will actively be interested in you or your business to remain in good communication and/or buy anything from you or otherwise refer others to you.  This can be done inexpensively, using email, social media (Facebook, Twitter and Linkedin especially), writing blogs, distributing business cards; even walking around with informational flyers works. A technique I like is “mutual benefit” marketing; I buy from you, or advertise and refer people to you, and in turn, you buy and refer people to me.  Social media is a great tool for this (think of the Barney song, “I Like you [on Facebook], you Like me…”).

In your early marketing efforts, pay attention to what messages and media are effective.  If offering discounts doesn’t work, maybe branding your business or product as the hip thing does.  Ask your potential clients and existing customers what motivates them to buy a product or service.  To avoid sounding like an obvious sales pitch, I ask what purchases they’ve made recently.  For example, I sell print marketing and office products.  At a trade show, I ask what equipment they’ve bought recently, or who they’ve hired recently.  If they haven’t, I ask if business is down and get their opinions.  If they have, I asked what made them choose that model or person.

I may not be able to sell him a new car, but I CAN find out that he bought the Porche because it makes him appear successful.  After talking with 10-15 people at a mixer, I find that all of them like to look successful.  Guess what message will be in my next email blast or flyer?

The specific tools you use depends on your business also.  My company, Accurate Forms & Supplies, is primarily a business to business (B2B) enterprise.  Therefore, I’m not going to go to Walmart and put my business card on people’s windshields.  First of all, it’s annoying and not an effective way to get your name out there.  Second, my product line isn’t geared toward individual consumers; so even if it wasn’t annoying, most of the people seeing my card or flyer couldn’t purchase my products anyway.  I would want an informational flyer or ad that communicates to business owners.  Then, I would need to place the information where my target market will see it AND be interested enough to want more information.  Wall Street Journal, talk radio, etc. are where I’ll be looking to get my message.

As your business grows, your marketing should grow also.  Once your communication lines grow to 100, 200 etc., your marketing should grow to attempt to target hundreds or even thousands of potential customers and referral partners.  Here, your looking at having a professional website, backing with automated email autoresponders, email newsletters, and advertising.  A key point here is, do what was successful to get you to this point.  If business cards and social mixers didn’t produce results, but Facebook advertising did, expand your Facebook advertising and drop the unsuccessful actions.  Use the tools and messages that worked in the past, rather than holding onto unsuccessful actions.

Notice I didn’t necessarily say, “spend a lot more money.”  If I got started by just printing flyers and handing them to people and that worked well, I just expand it.  I could hire 2-3 guys and have them pass out the flyers for me.  Or, I could hire a company that passes out flyers for me.  I can call Jim and have him print thousands of the flyers in color for less money than it costs me to print them myself (OK, shameless plug).  The same action that cost me $50-100 and my personal time could reach 20x more people, while the cost of the new scale only increases 2-3x.

To conclude, marketing should be geared toward 2 things: 1) expand your communication lines and promote your business on a gradient scale; and 2) correctly target and reach your potential customers with a message that will make them either want to buy or be curious enough to follow up and seek more information.

Stay tuned for more detailed information on how to utilize the techniques mentioned in this article.