Now is the perfect time to boost your dealership’s marketing initiatives.
A common question we receive at our agency is “How much should I invest back into my business for marketing?” While some of the “textbook” answers are 5-7% of gross sales, this is not always the case. There are several factors to consider, including the stage of your business. For example, if your dealership is young and you are building your brand, you may have to spend more to get your name recognized.
According to the U.S. Small Business Administration, as a general rule, small businesses with revenues less than $5 million should allocate 7-8% of revenues to marketing. This percentage also assumes you have margins in the range of 10-12% after you’ve covered your other expenses, including marketing.
Even more critical than knowing your budget is knowing how to spend it and that should begin with a marketing plan. Here are a few basic steps to help you develop a successful marketing plan:
Step 1: Outline Your Goals
What are your goals for the year? In most cases, your top goal is increased sales, but what are your specific sales goals? For example, do you want to increase new equipment sales, rental revenues or aftermarket parts and service? Or is your goal to grow your customer base or enter new markets? Be specific because each goal is the building block for each of the remaining steps.
Step 2: Define Your Target Audiences
For each goal, who is the specific audience to target to meet your goal? For example, if you want to increase generator sales, your targeted prospect might be consumers located in the postal codes that had the most power outages in the past 2 years.
Step 3: Draft Strategies and Tactics
This is the “how” of your plan. What marketing strategies and tactics should be implemented to reach each audience? Will you use social media, advertising, direct mail or a combination of these tactics?
For instance, if one of your goals is to increase equipment service revenue, you could implement special “spring maintenance service days.” The offer can be promoted via direct mail or email to your current customer base, with a “friends and family offer” for them to share. You could place ads in the local newspaper and on the radio. The promotion can also be shared on your social media pages or ads can be placed on Facebook.
Step 4: Align Your Budget
After your team outlines your strategies and tactics, you need to align them with your marketing budget. It is best to brainstorm ideas initially without being constrained on fitting all the tactics into the budget. You may find all the tactics fit within the budget. If you still have excess budget, think of additional activities to boost each initiative. If you are over your budget, analyze how to scale back or how you could implement these additional tactics when you exceed your sales goals.
Step 5: Develop a Calendar
Next, map out your plan on a calendar. Ensure the activities align with the resources you have allocated to execute the plan. For instance, if the bulk of your initiatives are hitting in the second quarter, do you have enough staff to manage the promotions and business? If not, consider shifting some of the initiatives to another time.
Step 6: Share with Your Team
Once your marketing plan is developed, share the details of it with your employees. This simple step is critical and often overlooked. Let your team know the goals, marketing tactics and timing. This will keep everyone focused on the goals.
Step 7: Analyze and Adjust
Throughout the year, it is important to analyze the results from each of your initiatives and adjust the plan to improve results. If the tactic implemented did not achieve the desired results, either remove, refine or try a new tactic to drive success.
Follow these steps to develop a well-documented marketing plan for a successful 2015. Many of the best marketing strategies can be generated by your own internal employees. However, when internal resources or marketing expertise are limited, consider seeking out a marketing agency that specializes in your market segment.
Your equipment dealer association may have preferred marketing partners or you can also reach out to marketing agencies in the rural and agricultural sector. Check out the resources from the National Agri-Marketing Assn. (www.nama.org).