The Yin & Yang of
Marketing & Sales—Part V
NoSpin Debunker
#43: May 13, 2002
The Chicken
& the Egg—How can you afford to invest in
Marketing?
First, one reader’s contrary
opinion to the last debunker: So where is the division of labor between Marketing &
Sales?
Mary Kay Conlon (formerly
of the Sachs Group and a former worthy competitor of mine years ago when she
headed Sales at Sachs and I headed Marketing & Product Development at
Inforum) had this to say:
“I agree
with your definitions and roles and responsibilities. In my experience,
however, Marketing takes its direction from Sales, not the other way
around. It is the sales force who hears daily what the market wants,
how it is segmented, what prices and packaging will fly, what the competition is
doing, and how the product needs to be changed. Marketing sees itself as
working for Sales (which includes the client
service organization, who is
also charged with reselling and up-selling).
Perhaps this was more a
reflection of the personalities and the power structure in my organization, than
roles and responsibilities. Or maybe I am talking about a process, rather
than roles and responsibilities. But to be effective, to be market driven,
Marketing clearly must work FOR the people who work FOR the clients and
prospects.”
I agree with Mary Kay’s
statement that in a lot of companies—probably the majority--Marketing is
directed by Sales. That’s one way to do it but not the best way to organize the
two functions for the many reasons mentioned last week. Unquestionably, though,
Marketing and Sales must work together, and BOTH are critical to growing the
company’s revenues and profits.
New NoSpin
Poll
Take the new NoSpin Poll
for May 13th: Do you agree
or disagree with the statement: My company's (or most recent company's) top
managers believe in Marketing.
And a couple readers asked
Jack Varney and me to clarify some
of our comments about “leads” and “prospects” from the last
Debunker. Here are our follow-up comments:
There are degrees of
“leads”:
Probably a better word for
a “lead” that is initially generated via marketing efforts is a “suspect.” There’s some early indication that this
person or business could be a potential buyer—based on a request for
information, willingness to provide contact information, use of a trial
“product” or service” analysis of past buying patterns (for other similar or
related products or services), market research,
etc.
We’re probably arguing
semantics here but a “suspect” (or a low level “lead”) becomes a true lead or
“prospect” in the Sales process AFTER the Sales team starts uses its due
diligence to qualify the suspect as a real lead. Then we’re into Sales Funnel
prioritization and management (which is a whole other important topic).
Note that
we are primarily talking about marketing and selling products and services of
significant complexity and/or cost that they require some level of in-person or
other individual Sales contact (versus lower priced and/or less complicated
products that often require no “closer” and can be sold
directly.
As mentioned in the last
Debunker, the true “owner” of the lead is the company—not Sales. Marketing
provides information to Sales regarding “suspects” that appear to be good
potential candidates for the company’s products or services, Sales further adds
to that information and qualifies a specific candidate—then works “the funnel.”
Marketing, in turn, further analyzes the data gathered by Sales to identify
additional opportunities within and outside the client base.
Back to the Chicken & the Egg
OK—I’ll bet that some of
you are saying, “Sure all this talk about Marketing sounds great in theory, but
how can we afford “real” Marketing until we get more business? All we can afford
now is Sales.”
This is a very tough, and
very fair question, but we really need to turn it around. As I’ve talked about
in a number of Debunkers over the past year, the question is rather, “If you
want to grow your business, how can you afford NOT to invest in
Marketing?”
But let’s be practical and
not ivory-towerish here. Cash flow to fund Marketing is a real challenge in a
lot of companies—especially in the last 12-18 months. Deep down a lot of
companies know that they are not investing enough in Marketing to really help
their sales, revenues and profits. But too often the conversation—and
rationalization--quickly degenerates into:
“Sure, I understand that would be nice, I guess, but we just can’t afford
it (Marketing) until business is a lot better.” Then, when a few bucks do become
available what happens, at best, is an uncoordinated half-hearted “marketing”
campaign that is usually not successful--adding further fuel to the fire that
Marketing is a dreaded expense versus an investment. Thus, a vicious cycle that
sometimes helps destroy companies--unnecessarily.
Good
Marketers are Like Good Investment Professionals
Jack Varney likens a good Marketing
professional (whether in-house or outsourced) to a good investment counselor:
Marketing is indeed an investment; Marketing takes very conscientious and
consistent work and continued investment over time to be successful; and
Marketing needs to be held accountable over time for adding to company profits.
He recommends “THE E-Myth” book series
by Michael Gerber that helps entrepreneurs realize that they are the
entrepreneurs and, in turn, need to delegate various functions like Marketing,
Accounting, etc. to knowledgeable people for the business to get achieve the
next level. As a matter of fact
companies may need to go through a couple of iterations of these types of
people—including Marketers--as the organization grows.
What’s your
excuse?
So you say you don’t have
the money to do the Marketing (that you probably need)? I’ll bet you do, and
here are a few places to look before you give up on growing your company (like
it could grow). Few companies don’t have at least a few pockets of waste that
could fund growing their respective companies:
·
Get rid of people who are
not contributing their fair share to marketing/selling, developing products, or
servicing customers—especially at the upper levels—where it least often happens.
As necessary, hire others who do their fair share and contribute--and get rid of
the unproductive cronies and baggage.
·
Outsource ANY functions
that offer equal or better service without the level of ongoing overhead (at a
minimum to give you additional future flexibility).
·
Eliminate marquis vendors
(big time law firms, fancy PR and Advertising firms, Big 4 Auditors etc—I guess
that’s sort piling on--given Andersen’s melt-down and others’ difficulties) and
use smaller, less expensive and sometimes much more competent
professionals
·
Force your Sales people
(in particular) to use technology, including email, web demos, and
videoconferencing to keep in touch with prospects and not make expensive visits
until the point in the Sales process they are truly needed.
·
Consider moving to less
expensive office space next time—no, not moving more people into crummy cubicles
but rather move to less pricey space—that may not have the same “prestigious”
address.
·
And I’m sure that if you
have the guts to be brutally honest (or take someone else’s brutally honest
advice), there are a number of others…
And by the way, the
financial soul searching exercise above (which you may need someone to help you
with) has little to do with knee-jerk moves like removing or making people pay
for their own coffee, water, or soft drinks; not buying up-to-date technology
(because people “already have PC’s”) or even slashing benefits etc. All
wonderful ideas to generate employee dissatisfaction and decrease productivity.
And quite asinine.
These are just a few ideas
to free up resources to invest in growing your business. The tendency, though,
is to fall back on the status quo instead—parallel to why nothing happens with
the lousy public schools in many states or why thousands of lives and billions
of dollars are lost in car accidents every year. There are proven answers to
these issues (unlike curing cancer)--just as there are answers to the challenge
of growing companies. But the reason nothing usually happens is that there just
isn’t the intestinal fortitude to make it happen. The status quo is easier.
The flip
side--if your company is a lean and mean machine
On the flip side, let’s
assume that you are the leanest, meanest outfit around. OK, new Marketing
investment needs to come from debt or equity capital—if you can’t generate it
out of cash flow right now. It’s truly amazing how many companies that are lucky
enough to have some reasonable access to capital never even consider Marketing
dollars as a good way to invest in their future. They’d rather watch their
companies flounder by hunkering down with their meaningless financial
“insurance” policy; or by developing more vapor, or by buying
difficult-to-assimilate companies, or by wasting it some other way. Of course,
Management will still own all of those worthless shares when the thing finally
tanks. Trust me, it happens
thousands of times a year.
Your
business cannot afford not to Market its products and services—not if you want
to keep growing revenues and profits. End of story.
Hope to hear from
you—until next time.
Please let me know what YOU think about this debunker!
If you would prefer to be removed from this email list, let me know.
Tom Ranseen NoSpin Marketing 615.383.7157