Chris wrote from Arizona to ask, “How do I market a business when the owner doesn’t want to spend any money on marketing or advertising?” I get similar questions daily from people who are their own bosses, asking, “How can I get more attention for my business and more clients with my small business strategic marketing plans? I don’t have any money for marketing.”
Trying to grow a business without allocating funds for your sales & marketing or advertising is like owning a car and not budgeting funds to buy gas. People could stop by and sit in your car with you, but you wouldn’t be able to drive it anywhere. You’d feel silly and frustrated. What can you do other than look for a new job with a more enlightened boss?
How can you get your boss to part with his or her hard-earned dollars to help you and the business be even more successful?
Discover how to grow your business using a proven sales, small business marketing strategy and effective business small business marketing plan >>
1. Define Revenue Objectives
The first step is to clarify revenue goals. Don’t ask your boss for money for marketing right off the bat; you’ll face a lot of resistance. Instead, ask your boss (or yourself, if you’re the owner):
• How much did the business make last year?
• What percentage of our target market is using our services?
• How many more clients and customers would you like to attract this year?
• How much would you like to see the business grow this year?
• What areas of the business do you think have the greatest potential for growth?
Help the boss to define the dollar amount you’d like to see added to last year’s revenue. Once the revenue goal has been defined, you’ll have much greater success in finding the resources to reach it.
2. Affirm the Impact of Sticking with the Status Quo
The next step is to clarify what would happen if you maintained your existing levels of marketing. Ask questions like:
If we continue to do the same kind and amount of marketing (which may be zero):
• Will sales increase or decline?
• What will the impact on revenue be?
3. Overcome Resistance to Spending
In your conversation with your boss, be prepared to respond to predictable objections. Most successful business owners got that way by being cautious about spending. Fewer expenses mean greater profitability. When your boss says, “advertising doesn’t work” or “I’ve tried marketing in the past and it didn’t make a difference,” be ready to follow up.
The best way to handle these objections isn’t to counter them, but to agree with your boss and ask the next question to help him or her understand why they didn’t work. For example, you might say:
You’re right; prospects didn’t respond to our ads.
• Do you think we were reaching the right audience?
• Were we advertising in the right places at the right times?
• If our marketing message or elevator speech didn’t prompt a response, what about testing some alternative marketing messages?
• Use questions to help your boss understand what worked and what didn’t and why.
4. Define the Investment Needed to Achieve Objectives
When business marketing is done well, it generates a return far greater than the expense. Start-up companies can expect to spend anywhere from 25% to 50% of net revenue on marketing; established companies from 5 to 15%.
The result is an ROI of two-to-one to twenty-to-one. What you want to do is help your boss determine the amount to spend on marketing in relationship to your company’s growth objectives. Ask him or her questions like:
• How much money have you invested in growing the business?
• What percent of revenue do similar businesses annually spend on marketing?
• If we could increase business by 50% this year, how much more would the company make?
• If we could double or triple each dollar we invest in marketing, would you be interested?
How much would you be willing to invest in marketing to increase revenue by another hundred thousand dollars this year?
5. Have a Strategic Marketing Plan for Your Business
Your boss will want to have confidence in a solid marketing plan before allocating funds. It is easy to throw money at marketing and advertising, but you need a proven business marketing strategy to generate a positive return. Questions to ask yourself include:
If I could get the boss to allocate more funds for marketing:
• What are the most effective ways to get attention for our business?
•Could we improve our marketing messages the elevator speech we use to describe our business?
• How can I generate more leads?
• How can I increase our conversion rate of prospects to clients?
• How can I increase the dollar amount of sales per client?
People are reluctant to spend money on marketing if they’ve had bad experiences in the past or don’t clearly see its benefits. Help your boss understand what went wrong with previous marketing plans and present the financial case for making the investment in marketing. You’ll have less trouble getting the funds allocated for marketing, and you’ll be on your way to growing your business.