Find the numbers and measure relentlessly
In any business there are three core activities that are very important to understand.
And it’s not just about the activities themselves but the numbers that sit behind them.
Those activities are:
- How you service and keep your customers
If you think about marketing, there are activities you will undertake such as lead generation initiatives that generate opportunities for you to sell to new customers.
When you think about sales, that means the people and activities that are done to sell what you do.
Then, when you think about customer service it’s also about the people and activities that drive that function.
Where it’s really important is the understanding of spending x to get y.
Let’s use dollars to make the point.
If you spend $100 on a marketing activity what will the result be?
If you can guarantee (because you’ve studied this) that the expenditure would generate 20 new enquiries; that following a sales process your team could close, say, eight new customers; those customers bring in, on average, $500 per year each, and you spend $100 to service those customers then that would be a good investment.
But until you know those numbers you really have no idea what you can spend on marketing with any sort of justifiable return on investment.