Measuring marketing effectiveness – why bother?!

Measuring marketing effectiveness for a company’s marketing activity is essential for ensuring that the benefits are maximised and the cost optimised ….. but how? It’s a well know cliche that “I know I waste half the money I spend on marketing, I just don’t know which half“. Marketing really is like any other form of investment – how much was spent and what did it deliver?

Being able to measure the results (or outcomes) for individual marketing programmes is key. A first step is to understand your sales and marketing pipeline. For a given month, this means knowing the number and value of:-

  • new leads generated
  • quotes you produced
  • orders you closed
  • sales invoiced

It is very easy to manage these pipelines by anecdote rather than hard data. Too many companies don’t quantify how sales are generated across the business. Armed with this sort of analysis you can take a cold, hard look at the incremental effect of any particular marketing activity. For instance you may be running a pay per click campaign on Google. You will be able to see how many clicks were generated, that’s easy, but how may leads/enquiries were produced as a result and can this be traced through to real sales?  Another example would be a telesales campaign where the objective is to get a salesman appointment. How much are you paying for every appointment, and how many of these appointment were successful? A client I work with knows that for every 20 leads he gets, he will quote on average to 10 of these and from this he will close around 4 orders. He knows the value of these orders so can easily work out if the cost of generating the original leads was profitable. Can you do something similar for your business?

I would have to acknowledge that these sort of measures can be difficult to produce, but it is very worth doing. Calculating for instance the cost per sales lead or cost per order will allow the business to focus the most beneficial activity. The feedback from knowing the effect of a campaign means that the activity can be “fine tuned” to improve its performance. A good approach is “to work out which marketing works best… and then do more of it!”. Sounds simple, but good measures are the only way to deliver this.

 

 

5 Rules to Avoid Conflicts in a Family Owned Business

Dealing with employees on a personal level can wreak havoc in a small or family owned business – because conflicts or disagreements are part of many start-ups and family owned businesses.   When it comes to conflicts of interest in a family business,  these matters are more difficult to resolve, because there are three levels of interests namely family issues, business issues, and ownership issues.  A dispute that occurs in one area can quickly cascade into the other areas.

If you are involved in a family business where every day seems like a battlefield, then you should consider outside help as it can destroy family, personal and business relationships forever.  While every business is different, I have put together some general rules for handling employees who are related by blood or marriage.

1.  Don’t put family members on the payroll if they’re not working in the company or canot make a real contribution to the business.  In a start-up or family business, everybody does everything, but you must make sure that everyone has a role and responsibilities that are spelled out and are very clear.  Think very seriously about offering a contract to a supplier who is also a relative = only award contracts based on merit.

2 – Do not create 2 types or classes of employees (family versus. non-family).  No matter how difficult it is do not to show family members special treatment, because in a family-owned business, special privileges given to a family member will demotivate employees and builds up future conflicts.

3 – Communicate honestly and openly with all employees, family or not.  Do not keep it a secret that you have relatives or friends working for you – when it eventually comes out (and it will) you will appear deceitful.  Also, non-family employees shouldn’t feel like family members are more ‘in the know’ about what is happening with the business – effective communication with all members of the organisation is critical.

4 – Do not confuse family decisions and business decisions. For example avoid letting family members borrow company vehicles or allowing them to ask the company’s IT person to set up their home offices.  It is a really bad idea to allow personal expenses (e.g. family trips or holidays) as business expenditures.  The owner manager must keep his business at a professional level at all time.

5 – Establish healthy boundaries between family and business – this especially applies to husband and wife teams.  Agree and stick to some kind of boundary rules, e.g. do not talk about the business after 6pm, at home on the weekends, or during family vacations.  In general, it should be a rule not work with family members on their personal time – keeping the conversation to 5 minutes is OK, but no longer.

Running an owner managed business is very rewarding, especially if you can work closely with family members.  However to ensure conflicts are dealt with professionally and quickly you may need an impartial and objective viewpoint from an experienced business adviser.

If you want to discuss how to grow your business, call 01494 829181 or contact us via the form below.

Taking Control of your Marketing – How & Where should I invest my money?

Even if we do not understand everything a ‘marketing guru’ says, all business people know they need to invest some money into marketing their products or services.

In a digital age, they are many questions.  Should I stop the traditional marketing and invest all my money into digital marketing?  Should I spend everything on pay per clicks and campaigns? Or should I use traditional marketing such as telesales combined with magazine and radio ads?

The Sales Funnel

Regardless of which channel, digital or non-digital,  the sales funnel is key.  Marketers must design campaigns that attract strangers to the company’s properties (website, shops, offices, social media pages, etc.) so they can see what the company offers.  There should be sufficient information and content to engage a visitor to consider buying or making a purchase (education & conversion).  The company must then deliver and service that purchase, making a first time buyer into a repeat customer and an advocate.

Marketing Return on Investment (ROI)

At every stage of this customer journey it may be applicable to use tradition marketing or digital marketing approaches.  The best way for an owner or manager to calculate what is working and continue to invest is by the analysis of the return on investment.  If an expensive pay to click campaign is not bringing the right type of customer to the website, work out why and correct it or stop doing it until you know.

This Return on Investment (ROI) is the metric by which success of a marketing campaign, online, offline or both is measured. Without constantly monitoring, a business cannot improve its marketing campaign to reach its target audience.

So the message is simple. Using an educated combination of digital and non-digital marketing can definitely improve your bottom line.  To find out where to invest your hard earned cash, calculate the ROI by analysing how the spend is delivering and whether it is meeting the campaign objectives.

Online and offline Marketing Channels

To learn how different online and offline marketing channel can work together, check out the infographic below from Colour Graphics.  – You may learn where companies tend to spend their online and offline marketing budgets, and get real results.

 

 Need Help?

Unsure where you should spend your marketing budget for the best result?  If you want some pointers and advice on practical steps to take – call Phil on 07720 397040, fill in the form below or email him for a free risk free meeting.

 

Succession Planning for an Owner Manager / Family Business

As an owner manager you have built up a good business and have been assuming that your children (when old enough) will eventually take over and continue to grow the business.  But the penny will drop that your children will not be doing this for a variety of reasons, including some great reasons such as they want to follow a different passion or career. So succession planning often happens too late.

Combine this with research from the USA that has shown that 88% of current owner manager and family businesses believe the same family will control their companies in five years, but succession statistics undermine this belief.  Only about 30% of family and businesses survive into the second generation, 12% are still viable into the third generation, and only about 3% of all family businesses operate into the fourth generation or beyond. This research indicates that family business failures can be traced to one factor: a lack of family business succession planning.

This problem is encountered far too frequently and points out how vital it is for a family business and owner manager companies to have open and honest conversations about what will happen with the company when the founder or current generation eventually retires.

Unfortunately too many business owners put off succession planning discussions far too long.  Subconsciously they know that their children are not prepared to succeed them or they have no interest in doing so.  Sadly, too many don’t want to admit this because the family business is more than simply a company, it has been a major part of their life for so long.

Based on our experiences and discussions with owner manager and family business owners about succession planning there are a few things you should start thinking about now.

Do not assume that your children will be as good or as committed as you are in running your company.  Entrepreneurial skills are not inherited by children, and you need to assess this during your exit or succession planning.

Passion or necessity has often driven an owner manager to start and build successful companies.  If your children are not passionate about wanting to take on your family business and will be doing it out of a sense of obligation, then your business will almost certainly not continue to prosper once you pass on the reins of the family business.

Do not assume that your current long term employees will be happy with your children taking over as the new owner manager. Quite often these employees are more qualified and knowledgeable in the management of your business than your children may be. The dynamics of current employees versus family members in succession planning for a family business is a serious concern and needs to be handled correctly.

And finally (for now at least) do not assume that the future monies, dividends or payments you are planning to receive from the business to fund your retirement will automatically be there when needed. Experience will have taught you that businesses go through ups and downs and earnings are not always guaranteed. This is blatantly true if you turn your company over to a family member who is not fully prepared to be the new owner manager and all that entails.

These factors and more are critical to consider as you begin to think about leaving your business to family members.  If you have not spent years preparing and grooming your children to take your place, and if they don’t have the skills necessary, and if they don’t have the passion for your business – you could be heading for trouble.

CMC has put a guide together to help business owners with succession planning and think about their exit strategy, download it from here

If you want to discuss your personal objectives and how to prepare for your future exit or business sale, call 01491 829181 or alternatively contact us via this form.

White Paper – Growing your Business – The People Dimension

Are you a small business owner looking to grow your business in the next 3 years? If so, you’re not alone! According to recent research by the Department of Business Innovation & Skill, 75% of owners have an ambition of growing their business during this period, however understanding how best to scale up your operations is not always obvious.

Determining what resources are required in terms of people and skills is key to growing any business and in our experience of working with business owners over many years, most encounter problems when it comes to hiring the right people.

Within this white paper you will gain an insight into the various stages involved and practical advice to help guide you through the process towards manageable and sustainable growth.

the people dimensionIncluded within this paper:

  • Growing your business – the view from the top
  • Are you “prepared” to hire new people
  • Can you grow the business without adding people?
  • HR Basics – bringing new people on board
  • About Management
  • Stages on the growth journey

Download your copy of ‘Growing your Business – The People Dimension’.

Simply complete the form below and a copy will be emailed directly to you.

How to attract a talented team into your small business

It is often said that a business’s most important asset is its people. So how come so little attention is paid to building a talented team when considering major strategic changes?

When a business owner considers how best to secure long-term growth or to prepare for an exit, the rationale invariably focuses on the Three ‘Ps’:

  • Proposition (What is the business planning to do?)
  • People (How do I build the right team)
  • Profits (What are the sustainable profit prospects of the organisation?)

The ‘People’ Dimension merits prime attention and does not always get it. Many investments are declined because no serious investor or business buyer will invest if the management team tasked with delivering future success lacks credibility.

The position is often complicated because the business owner has a loyal and dedicated team and may find it hard to risk betraying that loyalty.

However, this is a rationale for inertia based on fear. The boss may be afraid of consequences, and may think that he lacks the necessary experience to undertake fundamental changes to his team, which could ultimately upset his best customers.

This impasse is often the main cause of business stagnation and eventual decline.

However, once the challenge is recognised and confronted, it becomes a lot easier to address and long-term prospects will improve.

How to address the challenge of attracting a good, talented team?

There are some key building bricks:

  • Formal Annual Performance Appraisal of the current management team: through which, one can form a clearer perspective of the senior team and their support staff. Sometimes previously undiscovered talents and aspirations will emerge. A business leader should never assume that he knows his team inside out. There are plenty of perfectly sound Performance Appraisal templates available, but it is critical for the process to be undertaken regularly and objectively.
  • Annual Business Plan and any subsequent memorandum relating to investment or sale of a business will always contain a section on key people to demonstrate strength in depth to undertake new challenges or enable a new business owner to make a successful acquisition. An Organisation Chart is usually supported by short CVs of talented team players. This is a highly important piece of information. For example, if a business seeks investment to boost exports, it may need to recruit an Export Sales specialist. Will that person be  promoted from within and, if so, possess the relevant skills? If not, it will be necessary to flag the position as one to be filled as part of the investment process.
  • Talk to the existing team: Once a Plan for future growth or business sale has been worked out, with its future organisational needs, it is always prudent to share this information internally so that key players are not left in the dark, and understand the reason for creating new positions, and can perhaps contribute to these plans. There is nothing worse for a Senior Manager than discovering from outside sources, or a recruitment advertisement, that he may perhaps be overlooked for a new career opportunity. This is  an entirely avoidable accident.
  • Operate an open recruitment plan: all vacant positions in the organisation should be made open to internal as well as external candidates, unless the requirement is for specialist skills that manifestly do not exist internally. The interview process must be thorough and consistent for all. There is nothing worse than a boss giving the impression that a certain candidate is a ‘shoe-in’, with the interviews providing a façade of objective selection criteria.
  • Team mentoring: when bringing a new talented team together at a time of change, it often helps for team players to receive regular one-to-one mentoring from a third party, to help them ‘raise their game’ and make them aware of their role in a changing organisation. A third party is often able to pick up concerns or unrest, which could contribute silently to under-performance.

Any small or early-stage business will require assistance to get this right and small business owners must appreciate the need to invest in the right business advisers right from the start.

If this is a subject of interest and you want to read more about growing your business you can get more detail in this whitepaper – Growing Your Business – The People Dimension. Register to download.

Sales

Taking Control of Business Growth

The first thing to say is that for most small businesses, business growth is a very realistic option. My logic for this bold statement is based on observation and common sense. Firstly, most small businesses only have a tiny share of the market they serve – howsoever they choose to define their market.

Secondly, and just as importantly, the vast majority of the small businesses do excellent work and have very happy customers.  The least risky growth option for any business is simply to do more of the stuff they already do well – what marketing people call “sticking to the knitting”.

Business Growth Essentials

So this is the obvious starting point for absolutely any business that wants to grow. Before doing anything else the owner must address a number of fundamentally important questions:

  • Why do I want to grow the business?
  • How much growth do I want and how quickly do I want it?
  • Where is the new business going to come from?
  • Are the marketing and sales plans in place to generate the new business?
  • Does the organisation have the capacity to cope with the increased level of activity?

Why do I want to grow the business?

You need to have a good reason for embarking on a business growth path – to know what you want to achieve. Growth means change for the organisation and the team. It will put the operation under more pressure and almost certainly involve spending some money – and it involves some element of risk. So, having a bigger revenue number only makes any kind of sense if the profit grows at the same, or preferably faster rate. A bigger business may enable the company to serve larger clients, attract better staff, achieve higher efficiency, buy more advantageously – in fact a whole host of different outcomes.

How much and how quickly?

Good management is all about setting specific, measurable targets. Both businesses and people need targets to provide a focus for activity and to provide the motivation, reward and recognition for their efforts and commitment. The answers to these questions enable you to anticipate and plan the resources you will undoubtedly need. Knowing what you want achieve enables you communicate your vision to the people around you and, most importantly, lets everyone know when you have been successful.

Where is the new business going to come from?

New business can come from a variety of sources. Perhaps most obviously by selling more to the existing clients or by finding entirely new customers. Based on my earlier premise, that small companies have plenty of market to go at, there is always a lot of ways to answer this questions so some decisions are needed.  The plans and resources required will depend on the choices you make.

Are the marketing and sales plans in place to generate the new business?

Stuff doesn’t just happen. You cannot continue to do what you did before and expect to get a different result – you have to do new things, or extra things or change the way you have always done things to produce a better outcome. You need a proper plan – not just the intention to try harder!

Does the organisation have the capacity to cope with the increased level of activity?

The more I work with small businesses the more convinced I become that the solution to most of their problems are the result of insufficient “capacity” or making poor use of the capacity they do have. A phrase I use is the ‘businesses ability to do stuff.’ Small businesses are commonly full of very busy people. They are also very commonly full of duplication, inefficiencies and incomplete or imperfect processes. The result is that some significant proportion of the businesses “capacity” is simply being wasted. This shows up in lots of different ways and is often only apparent from the outside. Setting out to improve business growth without being certain you have the capacity to service the new demands is a recipe for disaster.

Was that helpful?

A lot of the ideas mentioned here are explained in considerably more detail in the white paper – Growing Your Business – the People Dimension which can be downloaded from the resources section of this website.

Will my firm benefit from an apprentice?

Many of our clients ask, how will my firm benefit from an apprentice?

The Government has promised 3 million new apprenticeships by 2020, funded by the recently introduced apprenticeship levy.

Employers today are waking up to the benefits of apprenticeships. This can either be employing a new member of staff as an apprentice or encouraging an existing employee to further their career by taking an apprenticeship.

How the funding works

If you’re an employer with a pay bill over £3 million each year, you will have been paying the 0.5 % apprenticeship levy from 6 April this year. Firms subject to the levy will receive a £15,000 annual allowance, to be offset against the bill. This effectively means that employers with an annual pay bill of £3m or less pay no levy.

Firms not paying the levy, who offer apprenticeships to 16 to 18 year olds, will receive 100 per cent of the cost of the training from the Government. Employers will have to pay 10 per cent of the cost of the apprenticeship training for those aged 19 and over and the Government will pay the remaining 90 per cent, up to the maximum funding bands.

For non-levy businesses with less than 50 employees there will also be a new £1000 incentive towards apprenticeships for taking on someone aged 16 to18.

Details of the workings of the apprentice levy can be found here.

With all the focus on the funding the question moves on to ‘will my firm benefit from an apprentice?’

Benefits of apprenticeships:

  1. Apprenticeships provide skilled workers for the future

Apprenticeship training helps employees to improve their skills, which will benefit the firm in the long term.

An apprenticeship will also ensure that the skills developed are matched to the firm’s future needs. This will help fill any skills gaps and allow the business to source future managers and leaders from within.

  1. Apprenticeships increase staff loyalty and retention

Employees who have been trained in-house tend to be highly motivated, committed to the firm and supportive of its objectives.

An apprenticeship encourages employees to think of their job as a career and to stay with the firm for longer, which reduces recruitment costs. Offering an apprenticeship to an existing member of staff shows that you see them as an integral part of the workforce and are happy to invest in their future.

  1. Apprenticeships increase a company’s bottom line

Investing in staff trained through apprenticeships has a positive effect on a firm’s finances, making it more competitive.

Furthermore, as companies receive funding for each apprentice they take on, it means they don’t have to spend as much to recruit new staff.

  1. Apprenticeships free up existing staff time

As a firm grows, staff often find their time is taken up by smaller tasks when they should be concentrating on their key areas of work. Delegating basic jobs to an apprentice allows them to learn and take responsibility. Freeing up the time of your more experienced staff.

  1. Apprentices can revitalise a company

Apprentices often bring a fresh approach and a positive attitude into the workplace. Which can have a knock-on effect on existing staff. By embarking on an apprenticeship, they are showing themselves to be willing to learn and can bring new ideas into the company.

As apprentices come from a range of backgrounds – including high-calibre candidates who do not want the costs of going to university – they can bring fresh insight into your business activities.

In conclusion, a firm that is willing to benefit from an apprentice is showing a positive approach to Corporate Social Responsibility, which is good for attracting both customers and future high-quality staff.