How do you know if you're getting value from your marketing spend?
We would be extremely cautious about investing new capital into our home unless we knew it was going to provide an equity return down the track. We may also be cautious hiring five new employees unless we had confidence that we could measure their success in the months to come.
In many aspects of our personal and professional world we think in these “cause and effect” kinds of way. You might say we take a “return on investment (ROI) approach.” Are you utilizing the same “ROI approach” for your BD, CRM and marketing investment?
April 1st is fast approaching for NZ professional services businesses, as is July 1st for Australians. Setting BD, CRM and marketing budgets is a feature for almost all professional services firms. Most that I know are asking questions 1 and 2, or versions thereof:
1. “Did we get return on our marketing investment for the year just gone?”
2. “What plans/activities will we add, do more of, less of or drop this coming year?”
Not all are asking themselves questions 3A and 3B:
3A. “Is what we spend as a business adding value to the intended audience(s)?”
3B. “And how do we know?”
Questions 3A and 3B compel us to consider whether there is measurability built into our plans and activities, so we know that our investment is providing return. Are we relying on anecdote, conjecture and gut feel or are we taking a measured ROI approach? Or put in more client-centric language: Is what we spend our budgets on of value to the intended audience(s) i.e. our current clients and/or our prospective clients? What are the big ticket items in your budget for marketing, BD and CRM plans and activities and is it money well spent?
I see a number of firms who spend large on hospitality, client functions, sponsorships, lunches, entertainment etc etc. Do you know what you get from doing this food, beverage and conviviality? Or phrased in that more client-centric way….do you have data that enables you to know what value your clients get from these things? A senior leader in your firm saying "my client said it was a good night" doesn't count by the way! At beaton we're in the business of measuring the effectiveness of BD, CRM and marketing activities in professional services. We ask your clients “of the activities your firm undertakes, how useful are they?” We specifically asked clients this question late in 2020 to understand what impact, if any, COVID has had on their views of such activities.
The importance of measuring the value your clients derive from your marketing, BD and CRM activities is critical. If you do not have such measurements, here are three insights from our research across professional services that may help.
“Communications on subjects of interest” and “customised presentations” are seen by a majority of clients as either very or extremely useful marketing activity. More than websites and social media. I have deliberately bolded those five words by the way, to reinforce the point that these need to be personalised, relevant to the clients’ world and timely. Not just a bi-monthly, centrally generated pdf sent from a CRM system!
“Acting on feedback” and “Resolving client problems” are the two most useful CRM activities in the clients’ eyes. Far more than lunches, rugby matches and bowling nights! Not to suggest there is not a place for such activities, but the key message is firms need to consider how your budget is allocated when it comes to what you spend on CRM activities. For instance, is your investment into gathering and responding to client feedback proportionately larger than the budget for lunches, hospitality, sponsorships etc?
Finally, since COVID arrived, clients have seen an increase in the majority of marketing, BD and CRM activities by firms. Two considerations, therefore: If you are doing the same as in previous years, you may be getting left behind. Maybe more importantly, if you are not deliberately focusing on what is most valuable to your clients when planning your marketing, BD and CRM investments, then you may be getting lost in the noise. If you want to chat about your priorities and budget setting for the year ahead and talk through how you might take an ROI approach, please give me a shout…
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