How to know if you’re likely to hit your number and learn how Agile, Integrated Marketing can help

Most business owners have a sales price in mind when they contemplate selling their business. Because businesses are typically valued at a multiple of revenue (or revenue derivatives such as EBITDA) this sales price is directly dependent on the company’s annual revenue at the time of the exit.

If you are considering selling your business in 2-7 years and would like to increase the odds that you will achieve your exit revenue goals, read on to learn how better and more cost-effective marketing will not only help you hit your exit revenue goal but can also increase your company’s sales price.

Will your current marketing effort deliver the revenue you are counting upon?

The first question to answer is: how much should you spend on marketing your business? There’s no fixed formula, but generally, according to the U.S. Small Business Administration, “small businesses with revenues under $5 million should allocate 7 – 8% of their revenues to marketing.” This will need to be adjusted depending on:

• Your current investment in marketing – if you’re underspending, for example, you may need to invest more to catch up;
• Your exit revenue goals – an aggressive goal will most likely require a bigger marketing investment; and
• Your competitive position – how you are positioned compared to your competitors and how competitive your industry is will impact the level of marketing investment you need to make.

To help businesses understand how to make these marketing investment decisions, Sales Renewal has a proprietary process – the Marketing Investment Analysis: Exit Planning Edition – that considers:

• Who you market to (B2B vs. B2C)
• What you sell (services vs. products)
• Industry Competitiveness (not competitive to super competitive)
• Firm Competitiveness (weak to strong competitive advantage)
• Top Competitor (much stronger to much weaker)

For example, a business in a highly competitive industry that wants to double its revenue prior to a sale will require a very different marketing investment than one with an average competitive position in typically competitive industry and a modest growth goal.

Marketing Investment Analysis, Exit Planning Edition

The Sales Renewal Marketing Investment Analysis: Exit Planning Edition is composed of 18 high-level questions which typically take 10-15 minutes to answer online. Based on those answers, Sales Renewal will formulate and deliver a set of sales & marketing recommendations specific to your business. Contact us to learn more.

Agile, Integrated Marketing – The Key to Hitting Your Numbers

Sales Renewal has taken two well-known concepts – Agile Development (from the software industry) and Continuous Improvement (from manufacturing) – to develop an approach to marketing that allows small businesses to use their often-limited time and financial resources to maximize their marketing return on investment.

The two key principles of agile, integrated marketing are:

Rapid Iteration – Produce marketing concepts quickly, get them out into the real world and iteratively improve them based upon feedback. A popular agile mechanism is the “sprint” during which the team breaks big, complicated activities into small, bite-sized actions that are quickly implemented and promptly evaluated so that the next set of activities can be prioritized and undertaken.

Plan-Do-Check-Act Cycle in Marketing – Agile marketing isn’t just about producing a lot of things quickly. It’s about responding to direct and indirect sources of feedback using rapid iterations to adjust and improve accordingly.

Integrated Marketing Breaks Down Strategic & Tactical Silos

Most marketing problems are multidisciplinary and so require the integration of multiple marketing tactics. For example, getting more leads from your website could be solved by: getting more traffic from SEO or getting more traffic from ads or having a better converting (written, designed) website.

But none of these tactics is right if implemented in a silo. Marketing today is multi-disciplinary, multi-channel and complex, and therefore requires an integrated approach.

The key to making this work? A coordinated, integrated marketing plan.

The Integrated Marketing Plan + Continuous Improvement

The traditional Continuous Improvement cycle is an iterative process that breaks down into four steps: Plan, Do, Check Act. When applied to integrated marketing, it means:

Plan

The first step is to create a coordinated, integrated marketing plan that considers:

1. High level, investment view to determine the financial ballpark;
2. Assessment of your business goals and strategies; customers; sales, marketing, brand & technology assets and needs;
3. Competitive review;
4. Specific strategies and tactics; and
5. An actionable plan detailing the required expertise, technology, budget and timeframes.

Do

Following your Integrated Marketing Plan, the second step is to put in place the foundational changes (brand, company positioning, etc.); one-time set up and configuration (website, redo social media sites, design direct mail piece, etc.); and on-going marketing (SEO on website, post on social media, mail targeted direct mail, etc.)

Check

Use analytics and benchmarking to measure the effectiveness of your marketing plan to grow your sales & leads. This will two critical questions:

1. Where did our visitors and leads come from?
2. Which of our activities generated the visit or lead?

These answers will allow you to do more of what’s working and less of what’s not and become more efficient over time.

Act

Integrated marketing is not a “set and forget” process. As you “do” and “check”, you will most likely need to adjust your plan. Acting in sprints allows for fine-tuning without having to recreate your plan.

The Key Benefits of Agile, Integrated Marketing for the Exiting Owner

Implementing an integrated marketing plan allows the exiting owner to increase revenue and decrease the cost per lead and cost per sale in the years before the exit. Using a Continuous Improvement cycle provides marketing metrics that allow you to systematize your marketing processes and workflows to make them repeatable and the Company less dependent on key individuals. Combining these concepts in an agile, integrated marketing program will allow you to make growth and return more predictable, thus reducing the buyer’s risk and resulting in a greater sale price.

This post is a summary of information presented in a recent Sales Renewal webinar, co-sponsored with BTA. Watch the full presentation here:

_____

Sales Renewal is committed to helping all small businesses grow their sales while sharing the risk and reward. If you’re considering selling your business in 2-7 years, however, our powerful agile, integrated marketing will be particularly attractive as it can help you maximize your sale price. To learn more, please contact us today.