1. The Value of a Good Sales and Marketing Plan
Marketing is expensive right?
Typically,mostpeople’sexperience withmarketingisthatit’sa waste of money. It’seithersome spinlike a prettygirl
witha puppyor a baby to getpeople to“notice”yourproductor company.Or it’s thousandsof printedbrochuresand
your logoontrade show giveawaysthateveryoneleavesinthe hotel roomorworse,givestotheirkids. Andinthe end
whatdo you have to showforit?
Nothing….Atleastnotany businessgrowth.
However,marketingdoesn’thave tobe expensive,anditcanbe a veryeffective waytogrow your business,whenit’s
done correctly. If you focusyoureffortsonwhat will provideareturnon investmentitcanbe the mosteffective wayof
launchingprofitable growthforyourcompany.
But whatconstitutesexpensive? Whatistoo much? How do you seta budgetand calculate returnoninvestment?
Typicallyspeakingmanyexpertswill saystartformingamarketingbudgetbytaking10% of yourrevenue. We personally
believethat’susuallytoomuch. Our formulalooksmore like the following:
Revenue –lesscostof goods& S&A (general overhead) =NetRevenue
Thentake 10% of yournetrevenue =startingpointfor consideringamarketingbudget.
Thisis justa beginning,once youhave yourfirstestimate,thenyouneedtodecide whattospenditon.
Before youeventhinkabout decidinghowtospendyourmarketingbudgetthere are afew thingsyoumustdo.
1) How well doyouknowyourTarget Market? What’sa TargetMarket you ask? It iswhowill benefitfrom
purchasingyourproductor service. “Everyone”isnotthe right answer. Be specific.
2) What motivatesyourTargetMarket to buyyour product/service?Don’tassume whatisimportanttoyouis
importantto them. Itrarelyis.
Here’san example thatmighthelpillustrate ourpoint:
A lightbulbmanufacturerhascreatedan underwaterLEDlightbulbforwater fountains. (Think,the BellagioinLas
Vegas) Waterfountainshave historicallybeenlitwithincandescentlightbulbs. Incandescentbulbs are becoming
obsolete. Whoisthe targetmarket? Anyone whomanufacturesorserviceswaterfountainswithlights.

2. In thisexample,LEDlightsare differentiatedfrom incandescentbecauseincandescentbulbs are goingaway. Doesthat
meaneveryone inthe targetmarketwill wanttopurchase them? Notnecessarily. Thereisabarrierof cost,LED lights
are WAY more expensive thanincandescent.Sotoconvertyour TargetMarket to your new productyouneedto show
howyour productor service providesValue toyourtargetmarket. That is calledyourValue Proposition.
You needtoknow what motivates yourtargetmarket,whatdrivesuptheircost?What hassle factorsdotheyhave?
What are theirpainpoints? Once you understandthis,youcanthenpositionyourproductor service accordingly to
solve theirproblemorappeal towhattheyare needing.
Back to the lightbulbexample: The LEDbulbsare $300 eachas comparedto incandescent,whichare $60 each. Why
wouldanyone buythatwhenitis 400% more expensive? Well, incandescentneedtobe replacedeveryyear.LEDsonly
once every10 years. In 10 years,itwouldcost $600 to replace the incandescentbulbs,plusthe hassle factorof having
to replace themevery year. Bysellinga$300 LED bulbthat lasts10 years,youhave just savedyourtargetmarket$300
over10 years per fountain,plusreducedthe annual hassle factorof havingtogetin the waterand go change those
incandescentbulbs.Youhave providedValue.
Make sure that youknowthe difference betweenwhatmakesyourproductstandoutamong itscompetitionandwhat
makesyourtarget marketwantyour productoveranother. Theymay not be the same thinginitially. Lookat your
productand your marketverycritically,some outside inputonthisat thisstage isprobablykeyhere.
So nowyouknowyour targetmarketand your value proposition,how doyougetthe wordout? Thisis where an
effectivemarketingstrategycomesintoplace.Youhave yourmessage (valueproposition) andyouknow whoyouwant
to say itto (TargetMarket),now youneedtofindthe road to get the message infrontof thisaudience.
Thisroad, or strategy dependagainonyourTarget Market. Where are theyopentohearingaboutyour productor
service? The internet,of course,isone of the mostcommonand cost effective waystoreachaudiencesthese days. But

3. make sure you knowwhere yourTargetwantsto hear yourmessage. Don’tdoa payper clickFacebookcampaignif
your targetisn’ttypicallyactive onFacebookordoesn’twanttohearabout yourproduct inthat medium. If youhave a
businesstobusinessproduct,where doesyourTargetlookforinformationfortheirbusinessvstheirpersonal life?
Make sure to keepthese straight. The stepsinthe roadare whatyou will spendyourmarketingbudgeton. Isita new
website withgoodSEO? A social mediastrategy? A (shudder) trade show?
Thisis a critical pointat whichyouneedtostart calculatingyourreturnoninvestment. If youhave setout to possibly
spend$10,000 on marketing. Whatreturndo youexpectandfor eachspendingopportunityinthat$10,000 what does
each andeverypiece contribute? If the itemsinyourmarketingplanthatcost moneydon’tappearto be able to bring
youthe returnyouare lookingfor,don’tspendit!
Once you have yourmarketingstrategyinplace youneeda salesprocesstodrive ithome.
Salesiswhatyou do to growyour business.Howmanysalesdoyouneedtomake? Salesbecomesanumbersgame
once you understandyourtargetmarketand whatvalue yourproductor service bringstothat market. Identifythe
businessesorprospectsinyour “target market”. How manyare there? The likelihoodof closingthe deal oneveryone
youcontact is slimtonone. Start by consideringall of yourcostsand whatnetprofityouwant to make. Addthose two
togethertoget an ideaof yourgross salesgoal. Then,presume 10 to 20% of your contactswill turnintosales. Thismay
be lowbut bettertobe conservative. Asyourbusinesscontinues,youcanrefine the numberstogetmore accurate
salesfigures. Speculatingwhatthe average sale mightbe,you candobasic mathto figure outhow many people you
needtocontact to get the salesyouneed. Are there enoughcontactsinyourtarget marketto reachthat goal?
So, clearlyidentifyyourtargetmarket,value proposition, create aroadmap or marketing strategyforapproachand
thenclose the saleswithaneffective salesplan. Easy,right?