Many managers consider marketing as an expense rather than an investment. How do we answer them? If marketing actions are well directed, they are always a lever for profitability.

Before starting a marketing project, it is essential to have some understanding of the market. What does your target customer buy? Where are the places he is most likely to buy? What are his values? Who are your competitors and what are they doing? As any good marketing specialist would say, there is no point in taking misguided action. You need to know where and how to direct your efforts to maximize profits.

A concrete example of application

How to choose your media? For example, a car dealer displays an advertisement inside a bus shelter in Montreal. Its print rate is very low for its targeted market since pedestrians do not usually have a car and are less likely to buy one. Although the exposure time is very high, the message is not addressed to them.

Before taking this action, the marketing manager should have taken the time to describe his target, understand the behavior and determine the places and media on which he spends most of his time to maximize his print and print rate generate sales. He must also consider a set of psychographic factors in order to understand the lifestyle and decision-making process of his targeted clients.

Demystify marketing

It’s important to remember that marketing is not synonymous with advertising, but it’s part of it. Marketing is a set of techniques designed to understand the needs of consumers and create value for them. It’s about providing the right product or service, at the right place, at the right time, with the right message and to the right people.

Also, it is important to understand the relationship between sales and marketing, two areas of a company that are closely interconnected and interdependent. Marketing and sales activities have the same goal: to generate revenue. Marketing focuses on developing tactics to increase the perceived value of prospects to the business and its products / services. In order to turn these prospects into buyers, the company’s representatives usually have to communicate directly with them to determine their needs, to provide certain precision and to follow up to finally generate sales. These two functions are therefore conducted iteratively and the process must be adapted to the industry and segment.

The goals of sales and marketing must be guided by organizational goals. For this reason, our experts are involved in other areas of the client company to align objectives and complete projects in an efficient and integrated way.

How to perform?

It is important to have performance indicators to ensure the profitability of marketing actions. At the digital level, there are a variety of indicators that are automatically generated, whether through Google Analytics, Google Ads or statistics provided by social networks. At a traditional level, marketing experts are able, using calculations or existing tools, to measure the performance of their actions.

More generally, if you want to know the profitability of your actions, you could evaluate, for example, the cost of customer acquisition, the percentage of customers from marketing and cost per opportunity (lead). Consult an expert to determine the best indicators that will allow you to properly direct your efforts in this area.

How much to invest in marketing?

Indeed, determining the budget allocated to marketing is a big challenge, especially for small business owners. Several methods are used to determine the optimal amount that will maximize the impact of marketing actions.

In some firms, the percentage of gross income is a favored method for determining the budget because it allows for proportional investment based on the business income. What percentage to invest? In this regard, there is a difference of opinion among the experts. No doubt because the answer depends on the internal and external environment of each company.

There are several other factors to consider when setting your budget:

  • The industry;
  • The competition;
  • Your goals;
  • The deadlines in which projects must be carried out;
  • The expected return on investment.

In order to allocate the right amount to each project, it is important to properly assess the cost of each resource mobilized before determining your budget. Running out of resources in full realization can lead to considerably negative consequences.

How to do it?

The different techniques you can use to determine your marketing budget will be the subject of a future article. You can also consult our experts to establish your budget and determine how your projects will be deployed.

Here are two key elements to remember to maximize your profit

  1. Focus on planning, strategy and execution to properly direct your marketing efforts.
  2. Don’t only value the amount invested, but most importantly, how it is used (efficiency and effectiveness).