Building a marketing system in a company must necessarily start with a strategy. Why? Because when, for example, digital advertising is set up professionally, the visuals and design are flawless, and there is zero profit, it means something is wrong. With the product. With the price. With positioning.
What the marketing system includes along with the strategy:
- Market research: on an ongoing basis, relying on professional analysts, or at least a benchmark analysis conducted independently by the marketing department together with the sales department.
- Understanding the target audience and its needs at the level of different segments. Focus on behavior: what they watch, what they are interested in, who they communicate with, how they react, what their values, preferences, and interests are.
- Positioning, corporate identity, messages, tone of voice. Absolute correlation with the first two points. Therefore, first, the ones above
- Communication channels. Does it really have to be TikTok? Or YouTube? Does your website design look professional? Does it work well? If the marketing system is created correctly, there are no questions here
- KPIs and their implementation. There are not so many basic ones, but they are important. For example, ROMI, ROAS, Brand awareness, NPS, etc.
Based on the existing marketing system, you can build customer retention tactics. As practice shows, retention is "cheaper" in terms of marketing investments than attracting new ones.
First, let's talk about the CRR (Customer Retention Rate), or customer retention rate. It is calculated as follows: CRR = [(E-N)/S]x100, where S is the number of customers you have at the beginning of the selected time period, E is the number of customers at the end of the selected time period, N is the number of customers you have attracted during the selected time period, new customers.
For example, your year started with 800 customers, 200 more came in during the year, and you ended the year with 600 customers. The calculation: [(600-200)/800]х100 = 50%. Small startups aim for a CRR of at least 20%, while global corporations can reach 70%.
And now to the most important thing.
Customer retention tactics:
- Shared values with your customers: eco-friendly, sustainable, made in Ukraine, etc. This is easier to implement in agriculture than in other businesses.
- Changes. If your customers are "tired" of your brand or bored, it's time for a change: differentiation of the line, a new team, new colors, a new logo, post-service (free agricultural support).
- Human face of the brand. Customers don't care about your numbers and metrics. They care about people. Talk to them as people whose needs and pains you understand.
- Implement credits. Nowadays, this is very relevant for farmers, especially small and medium-sized segments.
- Create a club for those who are currently loyal to your brand: send birthday and professional holiday greetings, make new products available to loyal customers first, and then to everyone else, etc.
- Take a look at the customer profile again. What distinguishes those who stay with you from those who leave after the first purchase? Draw conclusions.
- Use word of mouth. Post real reviews of your customers, let others know too!
- If it's possible, make delivery fasterthan your competitors if you have an e-commerce platform. Or ensure the availability of products that your competitors do not currently have.
- Get your money back and take your goods back faster and easier than your competitors.
- Make it difficult to replace you: politeness, decency, matching words and deeds, emotional attachment to the brand, etc.
And to the most painful question of all top managers in companies: how will I know that the marketing system, strategy, and tactics have worked? This topic deserves a separate article listing all the key marketing metrics. But a top-level strategic analysis will look like this.
MER (Marketing Efficiency Ratio)or marketing effectiveness indicator, on the air.
MER examines a company's turnover over a certain period of time and all marketing expenses over the same period of time. The higher the MER, the more effective your marketing efforts are for less money.
How to calculate the indicator?
MER = company turnover (for a certain period of time) / all marketing expenses (for the same period of time). Since this may include the entire turnover of the company, you should also add employee salaries, rent, cost of goods, etc. to the expenses.
But we are talking about marketing efficiency, so let's dive into marketing. For example, over the past 6 months, you have spent $150K on all marketing tools and received $300K from them. The MER here is 2.0 (300 / 150). That is, for every hryvnia spent, you get $2.
2.0 is not a very good result for MER. Anything above 3.0 will be a good MER. That is, marketing expenses should not exceed 30%. For e-commerce, for example, a good MER is 5.0, or no more than 20% of marketing costs.
Of course, if you're just starting a business, you need to invest in it, which means that for a certain period of time, the MER can be 0.5. But work on improving it every day.
Source: ArgoPortal
