You Don’t Know You’re Making
By John Haskell
Business is tougher today than it was a year ago. Recently,
a mid-sized company evaluated its situation: It faced a quickly
shrinking market, and people just weren’t buying as much.
Competition was cutting prices in spite of higher costs.
Salespeople were losing business all over the country. What options
did they have to improve the business? They started by asking
themselves two questions: First, what were they currently doing?
Second, what had they not done in the past?
Five specific areas tend to stand out in examinations like
this. Individually, each is a problem; collectively they can spell
disaster for your business. Luckily, it isn’t impossible to
eliminate these mistakes, as long as you have the discipline and
desire. Here are the five fatal business mistakes you could be
1. No Marketing
The marketing plan is the starting point, as it allows the entire
company to know the tactics to achieve the goals. There is only one
cure for this mistake: Write a plan. The format is simple:
Establish your goals. These need to be hard-edged goals;
avoid marshmallow marketing, such as soft sales targets,
undefined goals, weak market data, ineffective advertising and
vague promotion schedules. Marshmallows kill!
Identify the major problems that stand in the way of
reaching your goals.
Spell out the opportunities that offset the problems.
For example, you may not be well-known, but there is an
opportunity because those who do know you like your company and
Define a longer-term strategy – this is the “What?”
statement. What do we want to be four or five years down the
Define your tactics very specifically. This section of
the plan, accompanied by a marketing calendar and at least an
adequate budget, provides the road map for execution, which
leads to sales success.
This simple prescription for constructing a marketing and
sales plan makes it easy – you write to the outline. Take your time
and fill in the blanks. Start with opportunities. Then sort the
opportunities in order of priority.
2. A weak or
non-existent factual understanding of the marketing environment;
your company doesn’t have a competitive matrix:
Every company has a position in the market based on specific
attributes. For example, a cookie company judges its position by
the taste, price, size, and location compared to nearby competitors
who are making a similar product. These facts provide many
opportunities to get insight into your position in the market.
Narrowing them down to black and white, analyzing the vital
differences and planning how to respond to the competitive
environment is the prescription for success.
3. Lack of
understanding of your customer’s real buying motivation:
The psychology of
the customer is vital to marketing and sales success. Small
businesses may not be able to afford extensive marketing research,
but simple questionnaires and low-cost focus groups can deliver the
vital data that allows a company to build marketing, merchandising,
advertising, and sales promotion tactics that work. The
prescription has three parts: do the research, listen very
carefully and, most importantly, act decisively for the long term.
4. No Sales
Planning for the
business begins with a sales forecast. If the management team does
not look forward, they will get constant surprises. Forecasting in
most smaller and mid-sized businesses can be confined to customers
who contribute a significant percent of sales. Building a forecast
for a customer involves a careful, in-depth analysis of the
customer’s business, the customer’s relationship with your company
and the customer’s marketing plan for the next year.
The only person who should do the sales forecast is the
salesperson who is closest to that customer. Each salesperson must
forecast for his or her major customers with a fill-in the blanks,
paint-by-numbers approach. There are no excuses. The forecast must
be completed by a specific date and the salesperson must be prepared
to discuss the rationale behind the forecast.
Let the chips fall where they will. The difference between
the sales group’s forecast and the management’s goal for the year is
called the “planning gap.” Filling that gap is what marketing and
management are all about. The marketing team’s job is to eliminate
excuses by salespeople.
5. No sales system:
management is key to success. Effective selling is the result of a
complete system. Effective salespeople are “self-managed
professionals.” Self-managed professionals know that phone calls
must be organized beforehand, records must be kept and selling is a
Effective, professional selling is based on utilizing the
company’s marketing program to create a working marketing and sales
plan for each significant customer. The self-managed professional
salesperson has a game plan for every 30-day period. He or she
works the plan every day. Every phone call and every visit is
designed to further the plan. Becoming a self-managed professional
salesperson starts with this statement. “I know my customer, I know
my company's products and I know my company’s marketing plan. My
job is to bring these three elements together into a short- and
long-term plan for each of my best or potentially best customers. I
sell products that will not come back to customers who will.”
these mistakes allows a business to solidify its position in the
market and move forward regardless of the economy. Very few
companies have large market shares. Therefore, if your company has
eliminated these mistakes and is moving forward, you are positioned
to take a little business from each of your competitors who have not
eliminated the mistakes. A little here, a little there and you are
doing more than holding your own –you are growing your share of
market. When the economy bounces back, you will reap tremendous
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