Can Marketing and Sales Improve Contribution?

“How can I get more out of sales and marketing?” wonders almost every business leader at some point.

The answer is usually yes – but subject to careful investigation!

Here’s an approach that I’ve found works well. Think about what could be done differently, then drop the 20% of activities that are least effective and redirect those funds to try other things that might be more effective.

Programs and initiatives in businesses often take on a life of their own and out-live or out-grow their peak usefulness. Sunsetting these programs frees up resources to safely explore other strategies and tactics that could work better – and without having to increase total marketing spend.

If you do this on a periodic basis, you’ll always be innovating!

Now, you’re probably wondering how to identify the 20% that should be stopped.

There is no magic solution. Sometimes, it might be easy to spot low-performing areas that are overdue to be cut. Other times, you’ll need to take your best educated guess.

One counterintuitive tip I’d offer here is to look at some of your most successful and longest-running activities.

If these programs worked – and likely worked very well – why would you want to stop them??

Here’s why. It may be that SOME of these activities have accomplished their mission to create better recognition, lead generation, or brand prowess, and those benefits are now “in the bank.”

That is to say, they have created a strong brand foundation and now you can switch to other tactics that build on top of that base.

Challenge yourself to look closely here to see if can find some of your “20%” to swap.

And while I’ve used 20% to describe this principle, here’s the specific 3-step approach to take:

Stack rank your programs and lop off the bottom 20 percent performers
Invest half of the above funding into new programs.
Find 10 % of programs that have worked historically and apply the remaining funding to build on top of the successes.

Example:

A client had 15 sales territories and spent about $1 million per year on tradeshow attendance. We decided to no longer pursue the worst performing territories. (In fact, the worst 2 territories had never gotten off the ground at all!) We also cut the trade show budget in half and for the next 2 years only attended the “proven” shows.

These two decisions freed up about $1 million in funding annually. We plowed that full amount into webinars, which had demonstrated high impact and return. Here is what happened: