Marketing Genius from Maple Creative


Marketing tips, observations & philosophy, plus a few rants and random musings - from those who practice, preach and teach marketing, research, advertising, public relations and business strategy.

Thursday, December 08, 2005

The Pandemic: Last-Year-Itis

It's budget season. (Think Daffy Duck)

Unfortunately, there is a pandemic flying around the halls of many businesses that I communicate with: Last-Year-Itis.

"I want to keep our advertising and marketing budget at 4% of sales."

"How can you present to me a budget that is 25% above what we did this year, that is unacceptable!"

"We increase our marketing budget 4% each year, that's what you have to work with."

These quotes are tough to swallow.

They make sense from a pure accounting standpoint - projected sales are X based on this year's performance, marketing is X% of sales, therefore, your marketing budget is $YYY,YYY. Now, go away and create an environment for sales to flourish!

There is a quote (I heard it was from Ben Franklin) that doing the same thing over and over and over and over and expecting a different result is one definition of insanity. Well, y'all - I think were insane.

I'd rather start with questions like:

"What do you want your sales to be next year?"
"What is our close ratio?"
"Oh, ok, then we need to attract X number of prospects to get to the sales number we want."
"To do that we need to reach Y number of potential prospects and have a close ratio of Z."
"To reach those prospects, we need this many dollars to get an effective frequency."

I know it sounds crazy, but sometimes you need to forget the past to try to reinvent the future.

The numbers don't always make accounting sense. But if we do our homework, figure out what the value of buying added reach in our prospects' mind is, and create resonating selling propositions to present to them - there might be a cure for Last-Year-Itis out there.

Do you want to be 3% better than last year or 30%.

If you said 30% - then you need to create marketing that is 30% more effective at reaching your prospective customers and driving desired behavior. OR, you may have to spend 30% more on the tactics that are currently working for you to drive the sales number up!


Blogger Jen said...

At our recent conference, our keynoter, Robert Woodson, founder and president of the National Center for Neighborhood Enterprise in DC, provided a 'grassroots interpretation' of another quote, "If you keep doing what you are doing, you'll keep getting what you got!" (I think that he said that it was MLK, but I am not sure.)

He urged nonprofits to look at the work that they are doing. If they want to change things and improve, they should look at the desired outcome and work toward that. Not work this year, same as last, and hope for the best! Also, if you want to see positive progress, look at the positives instead of negatives.

This is something that has also been expressed during the training on Appreciative Inquiry by Trish Hatfield.

I think that nonprofits and for-profit companies alike need to look at what they are doing and see how they can improve.

After all, "If you keep doing what you're doing, you are going to keep getting what you've got!" So, think about it this year instead of moaning about it next year...when it might be too late!!!!

AND - What ever happened to the saying, "You've got to spend money to make money?"

It's almost like business leaders don't understand the importance of promotion!!!! Oh, but you bet they will read up all they can about accounting. Accounting is important, but you won't have to worry about keeping up the books if you are no longer in business b/c you haven't promoted your product/service.

--Ok, so I'm a little fired up. Sorry. :( I'll quit before my blood pressure skyrockets.....

3:30 PM


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