How to Create a Marketing Plan to Double Your Profits
Tactical marketing used by most businesses, often a simple advertising campaign with Adwords, perhaps some SEO for the website plus some social media just produces incremental results. That is a number of largely unconnected campaigns generate enquiries, some of which turn into sales adding to the bottomline but leaving the business back at square one, once completed.
To achieve dramatic long lasting results, a strategic approach is required. Sophisticated businesses use leveraged marketing, where the results are multiplicative rather than additive.
What is required is a plan to focus on all the Profit Drivers in a business. Small businesses tend to focus on a single Profit Driver, Enquiry Generation, but in fact there are five Profit Drivers:
1. Enquiry Generation
2. Sales Conversion
3. Average Value per Sale
4. Number of times a customer buys
5. Gross Profit per Sale
When you increase each of these Profit Drivers, each multiplies the results of the next. For example, just a 15% increase in each Profit Driver will double your profits. If there are 100 enquiries and the conversion rate to sales is 50%, that means you would have 50 sales. But if you increased enquiries by 15% to 115, and then increased conversion rate by 15% to 57.5%, the number of sales will be 66. Multiplicative. And so on for the other profit drivers.
A good marketing plan will have strategies for each of the five profit drivers.
For Enquiry Generation, the key strategies are Advertising, PR, Word of Mouth and Cold Calling.
Sales Conversion improvement requires the development of a Sales Pipeline.
The Average Value per Sales can be increased through packaging and upselling amongst other strategies.
Increasing the number of times customers buy can be achieved though communication strategies and rewards.
Gross Profits can be increased through a variety of pricing and cost management strategies.
The key is to identify opportunities for all Five Profit Drivers in your business, and set up a dashboard where you can track performance of each of the strategies and make adjustments to continually increase your profits.
Note that the focus must be on profit, not turnover. Why focus on Profit not turnover? Because too many businesses have profitless turnover in one or more of their products and services, and increasing turnover can actually reduce profitability. Your bottomline is Profit, not Sales. And I mean, Profit AFTER you have paid yourself a decent wage, and recovered ALL your costs, even the ones most owners ignore. No wonder there is so little left for them at the end of the year!
Relying on just one or two campaigns only achieves incremental results. To double your profits, you must be strategic.
May Your Business Be – As You Plan It.
Dr Greg Chapman – The Profit Whisperer
Learn more about how these marketing strategies would work in your business when you request a Free Preview copy of the best selling Small Business book; The Five Pillars of Guaranteed Business Success
Or find out how to directly apply and implement these strategies into your business and achieve your goals by requesting a Complimentary Business Evaluation now.