In a November 2012 Forrester Consulting study commissioned by Act-On, entitled “Driving SMB Revenue in a Tough Economy,” decision makers from 208 companies were asked to share their perceptions about a multitude of activities, including online marketing, business planning and programs, organization and process, and technologies used to support online customer acquisition.
The results of the study paint an interesting and informative picture of the top-performing SMBs. Seven key factors emerged from the results that help us to understand why some SMBs are succeeding while others continue to struggle.
The following seven habits are those that have been widely adopted by top performers:
- Use more online vs. offline marketing strategies in order to reach buyers and prospects, compete more broadly, and nurture existing customers.
A full 32% of top performers professed online marketing to be a game-changer that allows them to reach more audiences and compete more broadly. Only 20% of bottom performers felt the same. And, 68% of bottom performers perceived online marketing as a tool no more important than offline marketing activities, often perceiving online marketing as inappropriate for their brand or ineffective in reaching their customers. Also, 71% of companies using marketing automation were top performers and top performers engage in more active, verses passive, activities.
- Focus on customer lifetime value over customer acquisition costs.
Today’s most successful companies are approaching new customer acquisition with a “lifetime value” perspective, understanding that over the lifespan of the company/customer relationship, products may be purchased over and over again, and services may be re-subscribed to.
- Use a combination of strategies, including email, web and social media programs, allowing them to reach customers/prospects through multiple communication points
- Nurture customer prospects carefully and wait until the right time to pass leads on to sales; many businesses miss important windows of opportunities here
More than half of top performers nurture leads for 4-12 weeks before passing them on to sales, whereas bottom performers tend to pass off leads much faster. In fact, 43% of them reported passing leads off in less than one month, and the vast majority of those claimed to do so immediately. Interestingly, another 25% of bottom performers reported holding on to leads for more than three months.
- Measure programs and campaigns, taking advantage of the many types of metrics at our disposal today.
Top performers are significantly more likely to measure virtually everything they can, while bottom performers are far less likely to collect lead metrics at all. A full 44% of them claimed they measured nothing, offering valuable insight into the disparity between the two groups. Simply put, if you can’t measure and analyze it, you can’t improve upon it.
- Increase collaboration between sales and marketing, working together to set revenue targets and goals, and defining the programs and strategies that will work.
- Maintain marketing budgets during tough times, take advantage of opportunities, and don’t delay things like geographic expansion and hiring.
Top performers invest nearly 2X more than under-performers (40% vs 25%). And this has remained true even during the economic slowdown. Top performers were far less likely to reduce spending during the current economic downturn, with only one-third reporting a reduction in overall marketing budgets. Conversely, 56% of bottom performers cut their marketing budgets, most often decreasing investments in partnerships and channels–twice the number of top-performers. One-third of top performers increased hiring to take advantage of opportunities, where only 15% of bottom performers did so.
In light of these statistics a few things become quite evident. Companies that are actively involved in their marketing, including social media, and also make it a priority tend to be more successful. Something to think about when establishing your business priorities.
Companies of all sizes turn to Act-On to execute multi-channel, online demand generation and lead nurturing campaigns by automating critical marketing tasks and providing rich analytics and reports in real time. Act-On’s over 1,200 customers range in size from small and mid-sized businesses to small marketing teams within larger companies across all major industry verticals such as technology, manufacturing, healthcare and finance. To learn more, please visit the Act-On website.