Business Development & Marketing Cash Flow & Forecasting General

Resetting the marketing budget for 2017

Ready for Tomorrow?Given the challenges many SMEs are likely to face in the coming year, the quiet period between Christmas and New Year is an opportune time to reflect on the state of a business and consider where next.
Once there is a clear view of the way ahead it is also important to revisit the business’ marketing, consider what has worked and what has not and reset the marketing budget at a realistic level of spending.
One thing to remember is that marketing is not an optional extra. If potential clients or customers do not know who you are and what services or goods you offer they are clearly not going to be converted to buying from you.
This is particularly important to remember when trading during difficult economic conditions, when it is generally not advisable to cut the marketing budget.

How much money is available to spend on marketing?

This involves having a clear idea of how secure the business’ income is and this will depend on whether it has long-term contracts with clients and customers or not.
It is also important to know how much money needs to be retained to cover overheads and other expenses.  For example, the business that has a 12-month contract with a supplier will need to ensure it has the money to fund the obligations, especially when it is prepaid.
Armed with this information and a careful analysis of the potential for increased demand for its services or goods a business will be in a better position to establish what cash may be available to spend on marketing, and what proportion of that it can afford to use for speculative marketing.

Limited duration versus enduring messages

While businesses might consider the cost and impact of promotion material and the medium for distribution, it is also worth considering how long a message lasts for.
Businesses should also monitor the cost and results of initiatives such as time and money spent on social media. Paid for advertising such as Google Adwords, Google’s Universal App Campaigns or Facebook advertising should be measured in terms of a return on the investment.
Much of this activity disappears from view very quickly in that the message put out today may be lost tomorrow – or even in a few seconds in the case of Twitter. However, that is not to say that there is no value to such marketing activity. With sustained effort it can be used to raise awareness of a business’ brand while not directly bringing results in terms of immediate sales. Such marketing therefore needs to support other initiatives.
On the other hand, spending on a printed membership journal or client leaflet, where information remains available for a long period could be seen as more durable marketing. However how many of these are used by clients to find your products or services? It could be argued that years ago online search engines replaced Yellow Pages and similar directories.
There is never an absolute guarantee of immediate results with any form of marketing since ultimately the choice to buy remains with the customer.  Equally, there is a value in both limited duration and enduring messages.
The important point is to know exactly what cash options a business has and to decide how best to apportion marketing budget to get the optimal return on the investment.

Business Development & Marketing Finance General Rescue, Restructuring & Recovery Turnaround

App bubble 1 or Dot-com bubble 2 (Remember Dot-com bubble 1)?

headline "bubble burst"In January 2016, approximately 5,000 new apps and games per day were listed for download, according to the most recent research published by Statista. On the App Store alone 50,750 new apps and 19,130 new games were listed during the month.
There are currently over 2,200,000 Apps listed for download from Google’s Play Store and another 2,000,000 on Apple’s App Store and the growth continues to be exponential.
The question is whether it is possible for so many app developers to survive – remember the growth before an explosion of IT/web developers publishing new websites in the period 1997-2000. They were seen as having the potential to make a fortune.  In fact, very few were able to make a living although some raised a lot of money before spectacularly collapsing when the Dot-com bubble burst 1999-2001.
In our view something similar is looming with apps and the reason is also similar with lots of competition and very few apps finding a market.
Most of them will fail due to customers not being aware of them. Those that are found and installed are often only used once before being uninstalled since the trial found them either irrelevant or not capturing the user’s imagination.
Marketing an app requires a huge investment to draw it to people’s attention and get it installed and trialled. Equally important is ensuring it stays installed because it is either really useful or great fun or users simply want it.
Without those two things an app is never going to be commercially viable.

Expert marketing and significant investment

A clear strategy is vital for marketing an app and needs to capture people’s imaginations in the same way that a good movie does – and remember a movie is only a hit if it is seen and that means it has to be marketed expertly.
It is estimated that when budgeting for marketing an app the calculation is to spend £1 for every app install.  It is also important to remember that for every install there are likely to be a percentage of uninstalls.  Of course, that does not mean people have not shared the app with other people so there is always a chance it might go viral but this needs a level of critical mass.
However, to attract attention against a field of thousands of competitors means spending real money. On average it is estimated that people have about 35 apps on their mobile phones and actually use only about 25% of them regularly.
Google has launched a Universal App Campaign that works in the same way as Google Adwords. The advertiser of the app pays per install but there is still the possibility that apps are subsequently uninstalled. However, any other app marketing strategy is difficult to deliver unless the promoter already has critical mass.
Given the difficulties of marketing an app and getting it noticed it is a reasonable prediction that there is a bubble looming and that sooner or later it will burst.
That doesn’t mean there won’t be an app equivalent of that closed its funding just before the Dot-com bubble burst and used the funds to effectively buy market share.
The alternative is to exploit an existing brand like the strategy pursued by Nintendo and its Pokémon GO app.
Please tell us how you plan to get your app noticed.

Business Development & Marketing Cash Flow & Forecasting Finance General Rescue, Restructuring & Recovery Turnaround

Budgeting for marketing when the business future is uncertain

marketing and its role in businessAt the moment there is a big question mark over the future prospects for business with many companies unsure what it holds.
This makes it a good time to establish precisely where the business’ strengths and vulnerabilities lie, hence our focus on housekeeping.
The topic for this blog is the allocation of marketing resources.
Businesses often make the mistake of cutting marketing budgets during hard times, when actually it is a time to consider doing the opposite.  However, it makes sense to reposition the strategy and goals.
Plainly, it is always important for potential customers or clients to be aware of the brand and its reputation, whether this be for high quality, fast delivery and/or cost-effective prices for their services or products. Readers of my blog of a month ago will be aware that companies cannot promise all three.

Re-focus the marketing budget

However, until the trading picture becomes clearer this is not the time to plan for growth and increase the marketing budget with that goal in mind. When the tide is coming in is the time to spend on customer acquisition but it is a costly exercise and easy to waste money.
Instead, in the short term, marketing spend needs to be re-focused, towards retaining and reassuring customers. That does not mean that a business should not reflect on the markets it might pursue in the future and perhaps cost marketing campaigns tailored to that purpose.
But the primary focus should be on securing existing home and, if relevant, overseas markets so the marketing spending should be 100% focused on this, on the return on the investment and on improving efficiencies to stand out from competitors and to survive whatever is coming.
The prospects of a recession in the economy are relatively high, particularly where, as in the UK, so much depends on consumer spending. Consumers are likely to be cautious, especially on spending on big items, when it is unclear what will happen to their jobs, their food and energy bills and to the value of their homes.
At the moment, therefore, services, retailers, construction companies and small manufacturers are all particularly vulnerable, especially those who focus on B2C markets.
They need to send out a message through their marketing about the benefits of their product or service, but also to spend wisely on improving that quality, speeding up delivery or reducing prices wherever they can.
(image courtesy of renjith krishnan at

Business Development & Marketing General

There’s no “one size fits all” marketing strategy

It is fair to say that marketing in all its forms should be an ongoing activity for SMEs in both good and bad times.
This should be regarded as a universally-applicable rule and arguably the only other such rule about marketing is that there should be a clear marketing strategy and a plan that establishes discipline over expenditure and monitoring results.
Beyond that, however, so many businesses fall at the first hurdle, which is collecting the information on which to base a strategy and plan.
Identifying ideal customers to target is the first step. For an existing business they may be easier to identify but for a new business it is essential to define the customers to target in any marketing campaign. Who are they? What is their buying behaviour?
Where are you most likely to find them, particularly online? How are you going to approach them? Why will they buy from you?
All this should be obvious but it is surprising how many businesses buy advertising or embark on getting a website or setting up a business page on social media without doing so.
Then there is the question of what you want from your marketing. Is it about getting your company’s name and business known (brand recognition), about maintaining a good relationship with existing customers or about generating leads to new potential customers?
Marketing can be pro-active or reactive and different campaigns are needed for each objective to get the best return on the investment from a marketing budget.
There are so many “marketing gurus” around that this research is essential to help you to decide which of them is knowledgeable and which best avoided.