Do you have difficulty proving return on investment on your sales and marketing spend?
It’s an ongoing concern for sales and marketing directors, but being able to justify spend is a prerequisite if you’re looking to contribute to the business’ wider objectives.
We specialise in helping businesses that sell products and services into the construction, built environment and industrial markets achieve a tangible return on their sales and marketing investment.
The following 5 areas are central to our success.
1. Make sure your targets & KPIs are linked to your overall business objectives
This link between sales and marketing and the wider sales strategy is where I see lots of businesses fall down.
In order to meet KPIs in a pressured sales environment, it’s very common for salespeople to farm existing networks and focus on products and services they’re familiar with. And this doesn’t always tie in with the business’ wider strategy.
This is particularly common when years of R&D have gone into a high-margin product that’s new to the industry. It takes more time to educate the market and build awareness of the proposition, which means sales cycles are longer than for established ranges. If salespeople’s targets don’t reward them for investing in developing those opportunities, they’ll stick to what they know. And that means the business will see sales continue at the low margin end with a protracted ROI on the new areas.
2. Ensure the customers/prospects you’re targeting link directly to your goals
Following on from the previous point, you need to be specific about who you target, so you can link sales activity to priority customer acquisition.
Employ a scattergun approach, and you’ll end up with an extended sales cycle, high customer acquisition costs and relationships that don’t benefit your business. To prove ROI on your sales and marketing spend, you need to be a sniper.
What does this involve?
Focus on that ideal customer. Research them thoroughly to identify which influencers and decision makers are most relevant to your proposition. For example, regardless of how much you’d like to be specified, it’s no good leading with this approach if your main point of differentiation is cost or how quickly you can deliver. And there’s no point in focusing all of your attention on main contractors if you’re part of a package that often goes to the subcontractor.
Once you’ve homed in on the precise audience for your proposition you can tailor your approach and messaging accordingly. For example, an estimator is going to have different goals and challenges than a design manager, so you can target and communicate with them accordingly.
3. Strategically target all relevant touchpoints to prove ROI for the long term
Once you’ve done the necessary research and qualification to identify the ideal customer, you can track how each touchpoint – be it a phone call, exhibition or advert, helps nurture that opportunity towards a successful outcome.
Understanding and targeting every relevant stage of the sales process is crucial to proving ROI on your sales and marketing spend, because you can break down and calculate key metrics such as length of sales cycle, lead and customer acquisition costs and customer lifetime value. It makes it much easier to identify what is and isn’t working, so you can refine your approach accordingly.
4. Set achievable targets based on quality rather than quantity
A bit of me cringes as I write that heading, because it sounds obvious. But it’s crucial to get this right, because there’s a culture in businesses that sell to the construction, built environment and industrial markets that hasn’t adapted to the way sectors have evolved in the past few years.
You can set a KPI that your sales people need to attend 15 meetings a week, and they might achieve that. But it doesn’t mean they’re attending the right meetings. You’ll be able to show a shorter sales cycle and lower customer acquisition costs if they attend half that number – when each is a genuine opportunity with a decision maker, and meets criteria in line with your wider sales strategy.
And that means measuring success in terms of the quality – rather than the quantity – of opportunities generated by your sales team.
5. Make it easy to track your ROI in real time
However you approach the sales process – whether you outsource elements of your business development or manage everything in-house – you need to ensure you can account for everything you spend.
We provide detailed reports and real-time feedback for all activity we undertake on behalf of our clients. Do this, and you’ll prove the value of your strategy, over the short, medium and long term.
CTA: Think you could be doing more to maximise your sales and marketing spend? Download our free infographic to discover 5 signs that your sales people aren’t getting in front of the right decision makers.