Every business needs to allocate its limited resources properly to avoid the consequences of being inefficient. This is why your marketing mix has to have a sound budget that focuses on things that really work. But this is generally more easily said than done. With a wide variety of marketing tools such as traditional ads, B2B telemarketing, social media, etc., it is very difficult to decide which items to spend more marketing dollars on. To help you with this issue, here are a few very basic tips to optimize your marketing mix.
Set SMART objectives. Here, SMART stands for specific, measurable, attainable, realistic, and time-bound which should be the characteristics of each objective we set. An example of a SMART objective is “to increase total sales by 25% by the end of the fiscal year.” Notice that it has all the five characteristics. You should avoid setting vague objectives like “to improve B2B lead generation.” Instead, it should be stated as “to increase B2B lead generation output by x amount after y weeks.”
Understand economic concepts. Marketers need to have an understanding of some economic concepts that affect marketing decisions. For instance, you need to know the implications of the law of diminishing returns to your marketing mix decisions. This helps you determine at which point in your budget your marketing dollars no longer generate favorable returns. There are many other models that you should have some basic idea of like marginal utility and economies of scale.
Manage information systematically. Managing information systematically means handling the right quantity and quality of data for decision making. Because of the overwhelming amount and types of data related to marketing mix measurements, you have to rely on systems and tools to make sense out of it. Normally, you’ll have metrics like return on ads placed, B2B telemarketing conversion rates, email click-through rates, and so on. Your objectives will prove quite helpful when deciding which information to focus on and which to filter out.
Seek professional help. Marketing mix modeling is both an art and a science which unfortunately not everyone can be good at. To be really effective, you may need the help of professionals. Although this option may cost you, the benefits will more than pay for whatever you spent. Good consultants and analysts are not hard to find. But beware; there are incompetent ones as well.
Marketing mix modeling or optimization is one of the most important decisions you’ll make as a marketer or manager. Just keep the previous points in mind to guide you as you go through this critical process.