Businesses need revenue to survive. Because of this intense revenue focus in the first five to seven years of business growth, there is an intense focus on ROI when investing in certain areas of the business. Early-stage and evolving companies usually focus on sales-driven resources because a direct correlation between investment and return seems obvious. But, as businesses grow, it becomes more apparent that there are other areas of the business that need to evolve to help the business grow. One of these areas is marketing, which is usually last on the list for investment and program development.
Most businesses wait far too long and spend far too little on marketing. And, when they do see that they need to invest in marketing to continue to grow, they don’t know where to start. As they are not marketers themselves, they don’t know what the business needs in terms of marketing: strategy, tactics, internal resources, 3rd party resources etc.
So, they under-invest. B2B businesses’ marketing budgets are historically too low and this inhibits achieving the growth you want in your business. MarketingSherpa reports B2B marketing budget should be 4 -11% of total gross revenue. So, if you have a $10M revenue generating business, you should be spending at least $400,000 on marketing.
Does that seem like a lot? Hence the title of the blog: Expectation vs. Reality.
And don’t just take my word on it. We’ve even reached out to a search consultant with almost 25 years experience – Daryl Daley of Intelligent Minds – to share his thoughts on the matter.
Here’s what your marketing dollars need to pay for:
- Your website – this area needs investment in SEO, content marketing, paid advertising, analytics etc. in order to generate leads to support the sales funnel.
- Marketing materials – catalogues, brochures, sell sheets, advertising etc.
- Marketing systems – email campaign platforms, CRM, analysis software, marketing automation etc.
- Trade shows – booths and displays, booth space, booth and material shipping – this can be quite costly.
- Marketing resources – whether internal or 3rd party, you need:
- Strategy – Your marketing efforts need to be led by someone with the expertise to do so. Having the CEO or VP of Sales/Marketing who has no marketing experience (or desire to lead marketing) manage a junior or intermediate marketing resource is not a winning marketing strategy. However, your proposed marketing budget won’t support a senior resource.
- Execution – You need a resource to roll up their sleeves and get the work done. Seem simple? If you invest in someone junior, they are likely to get their hands-on experience and leave. Invest in someone too senior – they want to be working on strategy, not “grunt work”.
- Analysts – Where are you spending and where is it working to help your sales team drive sales? This information is crucial to make investment decisions.
- Other Marketing Resources – creative design direction, graphic design, website developer, etc. The list goes on.
- And, a whole lot of other marketing stuff… but we don’t have all day.
The Results of Mismatched Expectations and Reality
So, the reality of what growing businesses are doing: hiring one marketing resource internally to do the work of a team valued at more than $400,000. Hmmmm. That doesn’t seem like it would work. It doesn’t.
- Marketing resource burnout – Overwhelmed, under-staffed, under-budgeted marketing resource quits.
- Too junior – No senior mentor to keep them learning and engaged. They will take what they can from the role and leave for a more rewarding position.
- Too senior – They want to develop strategy/vision and lead. But they have no one to lead. You expect them to get the marketing work done and that’s not what they bargained for. They very quickly realize that your expectations are not aligned.
To put this all in perspective, I spoke with Daryl Daley, search consultant from Intelligent Minds.
“In today’s competitive market, if you are looking for someone with hot skills, like technical or digital marketing, you should realize that not only are you looking for skills and expertise in the people you want to hire, but they are looking for skills and expertise from you so that they can learn and grow in their career.
If you hire someone and you don’t have the expertise yourself to keep them learning, challenged and engaged to get them to the next level, they will take what they can get from the experience at your firm and quickly move on to a more challenging job or position where they can gain more marketable expertise.
If they aren’t learning from someone more senior and experienced, if they aren’t challenged and led by that expertise, today’s candidates move on. Coasting in your career is something that candidates in the last 10 years simply won’t put up with as they rightly believe it limits their long term marketability in an ever-changing and challenging job market. This is particularly true in career paths that experience major change – technology and related fields, for example. In the digital marketing or other technology-driven career path, you need to learn constantly as the landscape keeps changing. Staying for a year or two at an organization that doesn’t allow you to keep up with those constant changes could mean a major negative impact on your career prospects in the future.”
The Reality vs. the Expectation Conundrum
So, the reality is that investment in marketing is limited but your organization may need a better value of marketing investment to continue to grow. How do you get all of the marketing you need (strategy, execution, analysis, graphic design, website, etc.) without paying full salaries for all of those resources?
You need to explore the option of partnering with a 3rd party resource that has that team in place and can wrap that entire suite of services up for you and deliver it to you on an ongoing basis. This keeps all of your marketing bases covered with specific expertise in all the right areas. This also allows you the flexibility to keep your fixed costs in check and keep a marketing slush fund to spend on an ad hoc basis when the need arises.
As you continue to grow, you can start hiring junior resources to handle more of the execution and rely on your 3rd party for more senior and expert functions. This allows for continuity in your marketing strategy and allows your new junior resource to have a mentor to learn from and grow their own expertise – growing your in-house expertise at the same time.
Daley from Intelligent Minds agrees:
“Relevant skills, experience, expertise, communication skills and business acumen are a winning combination and only rarely are those all found within a company’s pre-defined salary range for a given role. Compromises need to be made, including considering an outside consultant who can bring all of those skills to the table. In addition, your less experienced staff can learn and grow from having that senior expertise on-stage, even if only for a limited time each week.”
If you are reading this blog post because you are facing the Expectation vs. Reality Marketing Hiring Conundrum, read some of our related posts:
- 5 Things to Consider before Bringing Your Online Marketing Program In-House
- Are You Setting Up Your Marketing Team for a Freefall?
- How much are you investing in your web presence this year?
Or, contact us and we can talk to you about how Marketing CoPilot can fill this Experience vs. Reality gap.