How much money was wasted last year on marketing campaigns that didn’t deliver tangible results? If the truth were told, it was probably the most wasteful year in marketing history. New channels created a competitive frenzy of one-upmanship to see who could deliver the most viral content with little regard to bottom line management. Proven strategies were left behind in the search for the most fans, followers, and views. In theory the increased exposure would deliver more results at less cost, but it didn’t work for most companies because their marketing team forgot the fundamentals.

The purpose of marketing is to motivate people to spend their money with your company. It’s that simple. If your marketing isn’t moving your customers and prospects closer to buying your products and services it is a waste of resources. When new channels and opportunities appear, it is hard to know if they will work for your business. Creating well-defined tests to measure cause and effect is part of an effective strategy. Asking the following questions before running any campaign will significantly reduce risk and insure success.

1. Does it benefit our customers?

   The best campaigns have customer benefits that are easy to understand. Itemize the benefits so your marketing and customer care teams have a clear understanding of them. This makes it easier for them to share the information with customers and partners.

2. Will it make money, reduce costs, and/or improve service?

   Notice that this question doesn’t include “increase sales”. More revenue doesn’t always translate into bigger profits. Anticipating the return increases the likelihood you’ll receive it.

3. Are the corporate benefits long-term, short-term, or non-existent?

   Too many campaigns are planned today with fingers crossed hoping for a miracle. Requiring tangible corporate benefits is good business. Creating a timeline is solid planning.

4. How do our success metrics affect the bottom line?

   Fans, followers, and video views make great cocktail conversation but how do they really affect your business? If the people participating in your community come from your customer database, social activity will work for your company. But, if they are from the general population, odds are against a profitable outcome.

5. What happens if we don’t run the campaign?

   Asking this question removes the stardust from most marketers’ eyes. If there isn’t a significant reason to run the campaign, why do it? Your resources would be better spent creating one that will make a difference.

Test campaigns are the exception. There may be so many unknowns that the questions can’t be answered well enough to justify running them. Failing to include testing in your marketing strategy reduces innovation. The best strategies find the right balance between proven tactics and new opportunities.

There is a certain safety in following the rules. When a marketing path has been tested, there are few surprises or unexpected challenges. Mediocre entrepreneurs can create successful companies by following the steps of the innovators who have gone ahead. Odds are that the copycat businesses won’t last more than a few decades without a significant management change, but they will provide income for the founders until the industry declines or something new comes along.

When I joined the direct marketing industry ages ago, there were a couple of dozen catalogs that were so similar it was impossible to identify the brand without reading the name. There were slight variations in the items, but the look, feel, and product lines were eerily alike. One of the owners explained the copycat philosophy to me. She said that the company that had originated the look did all of the heavy lifting with testing new markets and products. The copycats had higher profit margins because they didn’t invest in testing or new strategies.

The benefits gained by following the leader didn’t last. All of the copycat catalogs died an untimely death. The companies that survived the peaks and valleys of the economy were the ones who invested in quality analytics so they knew what worked with their customer base. They tested different strategies, tactics, and products. Marketing rules established by others were viewed as guidelines to be tested, not hard facts because every corporate culture is different.

Learning from others worked because the guidelines were based on sound business strategy. They had been tested by varying elements to see what works best. Marketing pioneers readily shared their discoveries with new marketers who, in turn, continued testing and improving results. The information tested and shared ultimately evolved into best practices.

Things change.

In the last few years, best practices based on controlled tests have morphed into rules formed by personal preferences. The catalyst for this change was the introduction of social media and the vision of a marketplace controlled by the people. The new age marketers’ imagined a world where people find businesses to fill their needs instead of one where companies seek customers.

The combination of tough economic conditions and the new marketing channel promising untold riches with minimal effort created a perfect environment for people willing to pillage the online community. Individuals facing record long-term unemployment searching for ways to provide for their family and executives desperately seeking to escape a sea of red ink were easy prey. Self-appointed experts commanded attention with declarations of data cooked up in imaginary labs. Testing of cause and effect required too much time and effort. It was much easier to imagine something and declare it as fact.

Rules of engagement were created and enforced by the new age marketers. In their alternative universe, traditional marketing was taboo. Anyone daring to promote their business or products via social media risked being ostracized on public forums. Requiring a return on investment indicated stodgy old school management destined to follow the dinosaurs into extinction. The new marketing rules included:

• Promote others twelve times to every one promotion for your business.
• Do not use automated direct messaging on Twitter.
• Leave comments on other people’s blogs to increase traffic to your site.
• Do not use social platforms to share promotional messages.
• Give to get.
• Be completely transparent in everything you do.
• Do as we say not as we do. (This one was unspoken. The rule makers didn’t follow any of the rules they created.)

Few dared to publicly challenge the new leaders. The new media was, well, NEW. And, different. And, people were already hurting and afraid of making another mistake. Following the leaders seemed safe and $397 for a guided tour of the new marketing channel seemed reasonable in an unreasonable world.

Did it really matter that the tour guides had little or no business experience? Or, that they aggressively promoted each other with affiliate links while pretending that they were simply sharing good sources? Or, that the how-to information they were sharing was based on personal opinion and theory instead of tested and proven tactics? Not much because it was desperate times filled with desperate people. When you are drowning even grasping a straw provides hope.

Time passes and with time comes experience.

When social media was new, no one really knew how it would evolve. The newness is gone, but there are still a lot of unknowns. It’s a shame that the people who stepped up in the leadership roles spent their time telling people to “be awesome” instead of testing different strategies to find best practices. It’s equally shameful that people followed them blindly down a dead-end path.

Fortunately, not everyone drank the social media Kool-Aid. People that didn’t get caught in the drama invested their time in testing different things to see what worked or didn’t. Real companies are making the social channel work as part of an integrated marketing strategy that includes other channels. There are a variety of successful strategies that move people from social activity into the buying cycle. Instead of trying to be awesome, successful marketing teams work to make real connections with customers and prospects. They may not have a zillion followers or fans, but what they have is much better. They have a proven strategy for using social media to generate revenue.

Testing different strategies to establish marketing rules is the best way to create sustainable growth for your company. Doing this requires a complete understanding of your customers, their behavior, preferences, and how everything works together to create a profitable strategy. Start with your data, add questions, and test everything to find proven cause and effect. It takes time and effort but the benefits are worth the investment. And, don’t listen to people who are selling new age marketing without questioning their experience, information sources, and testing strategy. The same people who promised that “it was all about the conversation” are now talking about search engine optimization, direct marketing, benchmarks, analytics, and return on investment. Being able to talk a good game doesn’t make you a player.

Where will your company be this time next year? Will you be celebrating record profits or planning a bankruptcy strategy? The answer depends on what you do now to prepare for tomorrow. Business as usual doesn’t exist anymore. Our marketplace has changed from a multichannel environment to a maze of channels and platforms that distract buyers and stretch limited resources. Maintaining a presence on all of the relevant networks is impossible for small businesses and fiscally irresponsible for large ones.

The economic downturn combined with an influx of new opportunities to connect with customers is overwhelming to even the most seasoned marketing teams. When faced with so many choices and dangers, running seems to be the only answer. Some dart from platform to platform hoping to catch a viral wave that will rain a revenue stream. Others run away from everything new seeking comfort in the tried and true tactics that have delivered past successes. Both strategies are fear driven paths to failure. When everything is said and done, a divided house cannot stand and those rooted in the past will be left behind.

Change is hard. People naturally resist it until the pain of remaining in the status quo exceeds the fear of the unknown. Vision of a better tomorrow shared with the passion of a believer is the only way to move some from the comfort of days gone by. The team responsible for the future of the company has to share the vision. They don’t have to agree on the path, but the final outcome is dependent on their ability to see a better tomorrow.

Maybe the real question is where do you stand? Are you so rooted in the past that the future will pass you by? Or, are you waiting with an open mind, willing to walk through the door of opportunity and do the heavy lifting? The tactics that got your business where it is today won’t take it to the next level. Change like you’ve never seen before is required.

Positioning your company for growth requires a solid plan that encompasses every corporate function, department, and person. The business has to work like a well-oiled machine where every gear provides leverage to the one next to it. The process won’t be easy but nothing worth doing is ever easy. Here are some steps to get you started on moving your organization to the next level:

Assemble

Start with an open mind, blank paper, and the people you need to make it happen. It is helpful if you do this at another location but if that isn’t in the budget, clear your conference room of everything that reminds you of the status quo. List your corporate strengths and weaknesses and then do the same for your competitors.

Analyze

Dig deep into your customer file so you have the best possible understanding of their behavior, buying patterns, and preferences. Keeping customers active longer is the best thing you can do for your bottom line. It increases the return on acquisition costs exponentially.

Brainstorm

Where can you improve service and satisfaction without significantly increasing costs? What do you need to do to offset weaknesses? How can you be more accessible to your customers? What channels are you missing that can make a difference in your business? What customer needs are unfilled?

Eliminate

There are always more ideas and opportunities than there are resources. Select the best and prioritize them by commitment and return. This will help you choose when and what to do based on available resources and potential return.

Strategize

Effective action requires planning. The survival rate of companies managed by knee-jerk reactions and seat of the pants methodology is extremely low. Having a plan provides vision and direction. There may be detours and rerouting along the way, but mapping out the strategy is the best way to keep your business moving forward.

Implement

The best laid plans are worthless without implementation. Executing your strategy inspires confidence and provides feedback that can be leveraged into growth and profitability. Don’t finish the year with a list of things we could have done. Finish it with a compilation of “this worked, that didn’t”. This is the foundation that supports sustainable growth.

Revise

Perfection is impossible. The very best strategy will have components that don’t work. Continuously monitor the progress, eliminating the things that don’t work and expanding the ones that do. In the end, everything may be completely different from the plan but it will be tested and successful.

Celebrate

People need wins to remain motivated. If you are constantly pushing your team to move forward without celebrating the progress, they will burn out. You’ll be left with a failed strategy because it didn’t reward the people who make it happen. Celebrations must be inclusive, crossing departments and divisions. It is only when everything and everyone works together for the greater good that your company will reach its full potential.

Remember

Moving a company to the next level is a process. Trying to plan it in a few days won’t deliver the results you want. Give it time to gestate and expand in your mind so you and your team have full ownership of the process and results.

Anyone can grow a business in a thriving economy. Separating people from their money is easy when there is a steady flow of income and every economic news story promising more. Implementing successful growth strategies is more challenging when the economic environment includes the threat of lost income and little hope for new opportunities.

Continuous news coverage of failing businesses, lost jobs, corrupt management, and devastating wars is terrifying. Fear paralyzes people even when they haven’t lost their job, been affected by management corruption, and are not near a war zone. All they want to do is bunker down and hold on to their belongings. If your business includes bunker construction or survival kits, this is your economy. For the rest of us, we have to find new ways to grow our companies.

It’s challenging, but growing a business in a down economy is not an impossible task. Successful companies like Walt Disney, Hewlett-Packard, and Microsoft were launched during a recession. If you have an established business with a customer base, you already have a foundation. Building on it is easier than starting from nothing.

The growth tactics that work in a down economy will continue to produce sales as conditions improve. The investment you make to turn your business around will continue to generate a return for years to come. It’s hard to think about long term returns when facing short term disaster but knowing that the things you do now create a sustainable foundation makes it easier to justify the effort and expense.

The first steps to turning your business around are:

Stop the bleeding

When disaster strikes a community the first responders use a process called triage to sort injured people into groups based on their need for medical treatment. This allows them to maximize the effectiveness of limited resources. Businesses in trouble need triage. Management has to take an objective look at where the money is going and how well it is working for the company. Expenditures that don’t improve customer relationships, increase sales, or reduce costs have to be eliminated.

Improve your service

Keeping the customers you have is a top priority. Review processes and policies to insure that you are providing top notch service. The easier you make it for your current customers to buy from you, the more likely they will remain loyal. Streamlining processes to improve the customer experience has the added bonus of reducing costs. Fewer steps mean less handling is involved. This is a win-win step. It increases customer retention and saves money.

Challenge your team

If your business fails, your employees lose their jobs. They know this, but most people don’t think about how the company’s health affects their livelihood until it is too late. Ask your team to share ideas on how to improve service, acquire customers, and reduce costs. The people doing the work often have the best ideas for making it better.

Reactivate old customers

Sometimes people stop buying from a company before their customer life span is complete. Reaching out to good customers with a history of purchases can provide insight into why they stopped buying, re-engage them, or both. Doing this well requires strategic planning because it can be expensive. Start with the ones who spent the most money before leaving and work your way down the list until it stops being effective.

Engage current customers

Your best sales team is the people who love your products and services. Contrary to social media lore they will not aggressively promote your business without encouragement from you. Give them a reason (or ten reasons) to share their experiences with friends and family. When you reward their efforts, they are much more aggressive in their sharing.

Expand your business

Increasing products, services, or territory is counter intuitive when sales are down and costs are increasing. Even so, this step can create a turning point for your company. Look for opportunities to repurpose products or services, add accessories to best sellers, and opportunities to attract new customers. Assess the costs and risks but don’t let fear drive your decisions.

Growing your business requires customer acquisition. If you aren’t continuously bringing in new people to replace the ones who are completing their buying life cycle, your company is dying. Newly acquired customers fit one of three types. Adapting your marketing strategy to maximize your return is the best way to move your company forward. The three types are:

Active: Moves into the buying cycle and stays until the lifespan is complete.

Discount: Only purchases sale or discounted items.

Hit-&-Run: Purchases once or twice and never returns.

Watch the video for tips on how to market smarter.

For tools to help measure customer acquisition, retention and costs, check out our Customer Loyalty Toolkit.