Slashing Sales and Marketing Budgets May Be Just the Right Thing to Do

There is a widely accepted belief that “When times get tough the last thing a CEO wants to do is to slash his or her sales and marketing budgets.” After working as a Fortune company chief marketing officer and also as a consultant to dozens of Fortune 100s and hundreds of smaller companies (through two major recessions) I have come to conclude that this corporate old wives’ tale is a bunch of bunk.

When business times get tough (such as they are right now) CEOs and CFOs have to take a hard look at every one of their company’s business processes. They have to look at what each one of those processes costs. And then they have to take a hard look at what each one of those processes contributes to profits (or lack thereof). And, as they identify a process that costs more than it contributes to profits . . . they have to make some budget cuts. Sales and marketing budgets are no exception.

Of course, simply slashing budgets seldom saves a company. And it certainly does not prepare a foundation for restoring positive growth. Slashing budgets is a holding operation. It is an emergency step that may buy time while business process improvements that have potential to get the ship turned around can be made.

Taking a hard look at Sales and Marketing what many CFOs are confirming is that very few traditional Sales and Marketing processes are producing positive financial returns on the costs and expenses invested in them. As a result, CFOs are doing what they have to do. They are recommending slashing sales and marketing budgets.

In the face of budget cuts what most traditionally trained sales and marketing people are doing is continuing to do what they have traditionally done. But they are doing less of it. As a result, sales continue to decline and deteriorating financial situations continue to deteriorate.

What an increasing number of forward-looking CEOs are doing is stepping back to reassess their entire customer-facing business process (in which Sales and Marketing comprises only about one-third of the business process dots). They are redefining that process to include not only Sales and Marketing but also the functions that design and produce and deliver what their customers want. And, they are forming cross-functional sales and marketing business process improvement teams and they are providing them with the training and tools they need to connect the business process dots that Promise, Produce and Deliver what their customers want (and will pay for).

So, Mr. or Ms. CEO, slash your sales and marketing budgets if you must. But, by all means, move on to connect all of your business process dots that build customer bonds, increase sales and profits and build a foundation for quantum growth.

Boring Impersonal Ineffective CRM or Perfect Automated Sales and Marketing Tool?

How can a business with a sales staff turn their CRM system into a sales tool? The answer depends greatly on the system a company uses and the resources it has or is willing to have to make this happen.

Why would a company want to have this boring data be perceived as or used as a sales tool? The answer has more to do with psychology than process. The very nature and make-up of a sales person is such that they won’t use it fully, completely or honestly unless it actually aids in the sales process. In addition most sales people see a CRM system as a way for the company to capture their leads and track their effectiveness, and the majority of sales people don’t like that! This persona and angle gives them their edge.

Or does it?

Turning this into a tool that helps them make sales and be more effective and efficient is not just in the training and pushing of policy. It is also having a system that actually enhances, enables and drives the sales and marketing process while not being a mundane task or cold vehicle.

Pardon me while we get boring for a moment and review the basics of what a CRM is and thus isn’t. The aim of using a Customer Relationship Management (CRM) system is to enable storage of readily available records, to enable such records to be kept in such a way that analysis of the relationship between each record can be enabled, that such knowledge about the customers and prospective clients within an organizations purview can be enhanced. This is typically done using the database feature, mining such data both internally and externally and applying common business intelligence and reporting systems.

In most CRM systems the knowledge a company has regarding a customer at the very least, which is stored in the database, are the basics. This includes but is not limited to their name, who they work for, what department they work in, along with all known forms of direct or indirect contact. Some systems are more complex and take the database fields, along with the activity logged in association with the fields, to come up with client profitability, transactional behavior, e-mail opens and clicks-to-links, call center or sales force contact and communication logs, customer satisfaction and retention ratios, and manual entry of the success or failure of legacy mailings and marketing campaigns.

Capturing the information from the processes (sales, marketing, installation, credit extensions, etc.) and from the various marketing channels (phone, personal interaction, web site) is not only mechanical, technical and part of the company systems, but more importantly, part of the big picture. It is this big picture that must be instilled within those who will be performing the mundane task along with benefiting from it financially and organizationally. A great system allows complete access to what the sales and marketing members need for tools to do what drives the company. Access and process training avoids duplicate client data and multiple versions of the truth.

As has been written on our blog and publicly published, the perfect sales and marketing business model is within the reach of even the smallest business today. These systems, incased within today’s CRM’s on steroids, will:

  • Optimize marketing effectiveness
  • Attract prospective customers
  • Enable automated cross-selling and upselling
  • Aid in retention of clients and quality engaged employees who both are company advocates
  • Enhance the analysis of client behavior to aid in the product decision making and development process while furthering the drive to utopia with regards to quality and profitability targets.
  • Make way for tags, targets, groups and associations which enable the sales force to concentrate on identifying key prospective customers that cut their transaction time and increase their relationship building time.
  • Allow for the near prediction of customer defection and identification of those team members who contribute most to what the stakeholders seek.
  • Most importantly, the best systems automate the marketing process based upon behavior and choices and nearly eliminate the prospect falling out of the pipeline follow-up.

There are many businesses today that have a CRM system and some even have the best of the best. But the select few have put to use the one that changes the game, that levels the playing field, that can enable David to take on Goliath and that give their sales team a real too they trust and use because it helps them make sales and obtain & then retain loyal customers.

While the system is about data it must be about being a difference maker in the eyes of the users. The users must be able to visualize the results, understand their role, believe in its impact and trust that they will gain from having made this tool work for the betterment of all.

The perfect system does exist, and while they can be complicated, they are capable of performing the following tasks almost automatically when combined with your current web site and marketing efforts:

  • Attract web traffic and prospective customers via webinars, white papers, blogs, testimonial publications, social media and SEO enhancement. Then informing sales and marketing of the results.
  • Capture information and data by clicks, hits, visits, web forms, opt-ins, recorded conversations, electronic business cards, e-magnets and pod casts. Then informing sales and marketing of the results.
  • Nurture the reluctant prospect by educating and building a relationship through e-zines, blogs, caring personal conversation starters and an email series once a defined area of interest is established. Then informing sales and marketing of the results.
  • Convert leads and prospects into customers. Then informing sales and marketing of the results.
  • Deliver products and services, while automatically billing, collecting, renewing subscriptions and informing sales and marketing of the results.
  • Add-on, upsell and cross-sell. Then informing sales and marketing of the results.
  • Refer and collaborate with vendors and like businesses. Obtain and publish references and testimonials. Then informing sales and marketing of the results.

Your business must generate excitement, spontaneous enthusiasm, buzz and traffic. Your business must know how to capture leads with systems, how to consistently follow up with those leads, and how to turn them into advocates by creating an experience surrounding their purchase. Your business must have a sales team that knows this system will only enhance their performance through increased opportunities and conversion of leads to customers.

Sales and Marketing Plan – Traditional Marketing Won’t Get Customers Contacting You

Have you tried traditional marketing to increase sales? If you have I can almost guarantee that you have nothing to show for it. Traditional marketing may work for the big companies like Coke and McDonalds because they have the dollars to continually blast you with their message, but it won’t work for you. Don’t waste your time and dollars including traditional marketing in your sales and marketing plan.

You need a sales and marketing plan that is specific to the small business owner/service professional. Traditional marketing is too vague and it’s all about you and branding. News flash, no one cares about you or your brand and they never will. Your potential customers only care about themselves and their needs. You need to let them know your message is for them, that you understand their needs, and that you have a solution for the problem they really want to go away.

Whatever you include in your sales and marketing plan must have a call to action. No call to action yields no action and that means your money is wasted. A call to action is a low risk way for the exact people you’re communicating with to reach out to you. A good call to action is almost never, call me for an appointment. People just won’t call you because they don’t know you, like you or trust you yet.

In your sales and marketing plan you want to think about how you can give first. Traditional marketing almost never gives first. There are two benefits to the give first philosophy. One is it allows your best prospects to identify themselves. Another benefit happens because when someone gives something to us first we have a tendency to want to reciprocate the kindness extended to us.

Improve your sales and marketing plan by designing a plan specific to you. Make sure your plan isn’t focused on the company you represent. Focus on you the individual because people do business with people not big businesses. Then build a plan that communicates a specific message to a specific group of people with an opportunity for them to obtain something that would really be helpful to them while moving them closer to having a relationship with you that ultimately results in business.