You may have the best services or product in the world, but if no one knows about it and/or no one is buying it, it’s just an idea.
Many business ideas have had a lot of buzz or sound great on paper, but until enough customers are buying your product (or service) to make it sustainable and profitable, you will struggle to get ahead in business.
I remember sitting in a marketing lecture in 2001 when Professor Bryan Lukas said ”…finance provides the goal, but marketing provides the means…”. 22 years later, those words still resonate that the most important part of the business plan or the goals of the year, are, “How are we going to get enough customers in door to keep our heads above water.”
In Jack Stack’s book, The great game of business, although he discusses in detail how the SRC Holdings Corporation meticulously calculates and understands their operative expenses and cost of doing business, they always start their planning cycle with the sales and marketing plan (how many customers are they going get in the door and how they are going to do it) because it guides the resources required and capital needed to service their customers.
You can’t ignore the numbers – you need to know how much it costs you to run the business
I am going to contradict myself slightly by putting this point first, but you do have to know how much it costs you to run each aspect of your business to be able to plan.
Late last year, we spent several weeks with all the branch manager reviewing the costs over the last 12 months and nailing down the cost of running each aspect of the business of each branch. The great news about this process was that our running costs were not that far off the predictions we had made the previous year. It also gave the branch managers an intimate feel for the numbers and how much it costs to run the branch.
When we know the cost of running a branch AND we know the average client value, it makes it very easy to divide one into the other to work out how many clients we need to hit our financial goals.
Do not be afraid of reviewing your profit and loss to work out your cost of operating. This is essential to give you a target for the sales and marketing plan
Through marketing and sales – how are we going to do it?
Setting a target revenue number and knowing your costs isn’t going to tell you how you are going to get there. It is all good to say that your company relies on “word of mouth” for it’s marketing, however if the number of customers per week it achieves from word of mouth is 4, but it needs 7 to hit its target, than this method is simply not enough.
Making up the shortfall of 3, is where reading and creativity come into it. You don’t have to know how you are going to do it nor does every method need to get a “home run”, but you can choose which activities you are going to try to aim for this goal.
For example, we wanted to improve are word of mouth marketing by an extra 2 customer per week. We brainstormed as a team, discussed different ways of going about it and ended up creating simple, word of mouth vouchers that sit on the front reception desk and are also added to our welcome packs.
What is the list of new activities you are going to try (from reading and creative thinking) to aim to hit your marketing targets?
What happens if the plan is just not working?
The result of our campaign was an improvement in our word of mouth by 1 per week, but still short of our target. Was this a failure?
No. It was a step in the right direction, but not there yet. It does mean that it is not enough. Other areas of marketing we have added had included:
• Regular newsletters to local GP’s
• Maildrops
• Writing regular articles for our social media and website (to improve SEO)
• Customer re-activation campaigns
(To name a few).
Keep reading, thinking and changing your approach until you hit your target number and your business is in a place you want it to be.
What is the next thing you will try if you don’t hit your target number?
Group Mastermind – Do you want to get involved ?
Every Wednesday at 11.15am – 12pm, we hold a group Mastermind session to:
- Brainstorm strategies
- Discuss marketing ideas
- Work on each other’s business problems
It is FREE of charge and a great way to interact and pick the brains of other allied health business owners.
Join the discussion and have your say?
- Comment below!
- Call us on (03) 9857 0644 or (07) 3505 1494 (Paddington)
- Email us at admin@mdhealth.com.au
- Check out our other Health Business blog posts here
Our clinical staff would be happy to have chat if you have any questions.
