INSIGHT | Hayley Simmons
HAYLEY SIMMONS, KBB MARKETING
Marketing your way through potential challenges
As we approach 2023 with caution, consultant Hayley Simmons considers how to market your way through a potentially challenging economic period
W
hether or not your showroom is currently experiencing any slowdown in sales, the current economic uncertainty, and rising operating costs, will no doubt be playing on your mind.
We’ve exited a period of strong demand when marketing ROI was at its peak, or perhaps even activities were dialled down if the demand for your services surpassed your ability to keep up. However, when cash flow becomes a concern, marketing budgets are often the first things to be cut. I’m not here to tell you that this is a mistake as, without data to forecast what a cut in budget would mean for your business, it’s impossible to make that claim. However, retailers need to be ready to make tough decisions and have their eyes wide open to the potential impact of any decisions on future turnover.
Where are your sales coming from? If you’re not tracking every customer journey from prospect to sale and recording when and where each lead came from, then now is the time to start. As the purchase journey is usually quite long, you need a few months’ data to understand the return from your marketing investments. Where did they first hear about you and what drove them to get in touch? Did they arrive on your website from an online advert, or did they simply pass by or get referred? Data from digital activities can be easily tracked, but you should also ask them how they became aware of your business. This is so important. Your data may tell you the lead came from a Google campaign. However, they may have already been aware of you from social media, a local magazine or a recommendation. Recognising your name in the Google search results will increase their likelihood to click. To put it simply, some activity increases awareness, but it’s often the case that another activity drove them to take action. Both activities are valuable in this instance, but only one is usually measured. You should never make the
assumption that only one of them would have been enough without probing further. It’s valuable to understand the journeys that your customers take so that you’re armed with the information to support your decision-making. A CRM tool can really help here and some of the data can be captured automatically.
Where are the leaks in your marketing funnel? When do you start to use the word ‘lead’? Is this after they have completed an action on your website, after a phone call or a showroom visit? It varies across the industry, so I’m going to use the word ‘prospect’ as a precursor to a lead. This terminology is important because it’s often an area of poor investment and missed opportunity. Most marketing efforts and money go on generating the prospect, not turning the prospect into a lead.
Before making any decisions to increase or decrease budgets, are you working hard enough with these prospects? Customer expectations have changed – they often don’t want to speak to you on the phone at this stage. If they’re not ready to buy, use this ‘latent’ period to educate customers who have opted-in with great email content, encourage them to follow your social media and send them occasional SMS messages.
Don’t undervalue marketing activities that raise awareness and nurture future leads
The other area to look at is your close rate. Make sure when a lead is lost that you try to get to the bottom of why and record it against the source of the lead.
For example, if the most common reason is price, then this is as much a marketing issue as it is a sales one. Do you need to work harder, earlier, to justify your price point or are you attracting the wrong customers? Can your communications help to improve the qualification of that person before investing time in them? If this is a big issue for you, you may need to adapt to your local market. During a time when that market could shrink, does it make sense to offer
lower-cost options, alongside your main range, to service more customers? It’s certainly something to consider when faced with a potential slowdown in demand. I use the word ‘slowdown’ very intentionally. While we may see consumer confidence fall, people are still making home improvements. We call this ‘latent demand’ and eyes are still on your business. It’s important to avoid making the mistake of undervaluing the marketing activities that raise awareness and nurture future leads over time, in favour of the ones that are easier to measure.
THE BIGGEST OPPORTUNITY FOR RETAILERS IN 2023 IS...
THE GREY POUND The economic uncertainty could give retailers who over-index with older, more comfortably well-off consumers the upper hand. Rather than postpone purchases, they are likely to seek out better-quality products and services – this is where independents can thrive.
38 · December 2022
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