Not Knowing These Marketing Issues About Your Company Guarantees Your Program's Failure

Written By Ted Grigg
DMCG Results

There are some things you must know about your marketing program that are essential to success.

As a matter of fact, I consider them a test that separates successful CMOs from other marketing leaders. You must know the answers to these questions to do your job of maximixing the effectiveness of your selling efforts.

Yes, I said "selling" because if your marketing dollars are not bringing incremental revue at a profit to the company, then you have aleady failed.

Here is a list of questions you should answer before you spend one dollar on advertising or promotions. Otherwise, you will have no way to evaluate the effectiveness of your spend or the impact on the company's bottom line.

What you must know about your customer

  1. You don't know how many customers you have

  2. You don't know your average sale

  3. You don't know how your top 10-20% differ from your less profitable customers

  4. You don't know where your best customers come from in terms of location

  5. You don't know what your churn rate is

  6. You don't know the main reasons your customers leave your company or why they buy your product

  7. You don't know what competitors your customers also buy from

What you must know about your target markets

  1. You don't know how big your universe is in terms of good, better, best prospects -- actual counts available from data sources

  2. You don't know how to target your best prospects

  3. You don't know how much you can afford to spend to acquire a new buyer or customer

  4. You don't know how much you can afford to spend to sell your entry product

  5. You don't know the lifetime value of your average customer

What you must know about your promotional efforts

  1. You don't know what channels work best for you in terms of acquisition costs

  2. You don't know what offers work best with your various target prospects

  3. You don't know what channel combinations yield the lowest cost per sale or lowest cost per customer

  4. You have not established a reliable tracking system to know where your sales are coming from such as which channel, which offer and which promotion

So much of the success that comes from marketing begins by asking the right questions. So do all you can to compile the above information, master it and then use it to develop your marketing goals and strategies.

What other areas do you think marketers fail to understand before they embark on their spending campaigns?

Ted Grigg

Ted Grigg is a direct response strategist who helps growth-focused companies reduce risk by identifying weak assumptions before they become costly mistakes.

Over the course of his career, Ted has evaluated several hundred million dollars in direct response testing across direct mail, digital, print, television, telephone, and other channels. His work combines direct response strategy, acquisition economics, customer analysis, creative evaluation, offer development, and disciplined testing.

Ted has worked on both the client and agency sides of the business. That experience gives him a practical understanding of the pressures facing executives, marketing teams, agencies, and service providers—and of the problems that arise when activity, media volume, or creative preference replaces a clear economic objective.

His consulting work helps organizations examine such questions as:

  • Are acquisition goals economically realistic?

  • Is the allowable Cost Per Sale supported by customer value?

  • Are targeting, offers, creative, media, and response paths working together?

  • Are tests structured to produce reliable business decisions?

  • Are unproven assumptions being treated as facts?

  • Is the organization measuring sales outcomes rather than convenient proxies?

Ted’s experience includes the development of direct mail and multichannel acquisition programs for insurance, healthcare, financial services, technology, nonprofit, manufacturing, retail, transportation, communications, government, and business-to-business organizations.

For a national direct-to-consumer insurance company, he developed a direct mail format that defeated established controls and helped expand the productive use of compiled prospect lists from less than 10 percent to more than 30 percent of total direct mail circulation within one year. He also planned Medicare lead-generation programs for more than 60 regional and national HMO and PPO organizations, with some programs exceeding sales projections by as much as 60 percent.

Ted founded Wyse Direct, a direct marketing division of Wyse Advertising in Cleveland, where he developed acquisition programs and helped launch a new technology product for Seiko Instruments by generating a predictable flow of qualified sales leads for its national sales organization. As vice president of new business development for the Grizzard Agency, he helped broaden the agency’s strategic capabilities and pursue new commercial and fundraising opportunities.

He is the author of The HMO/PPO Marketing Plan—A Step-by-Step Guide, published by Executive Enterprises, and has written numerous articles and conducted webinars on direct response strategy, testing, creative development, and marketing economics.

Ted earned a Bachelor of Arts degree from Abilene Christian University and completed two years of graduate study at Texas Tech University. He is the founder of DMCG, LLC.

http://www.dmcgresults.com
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