Creating An Optimum Growth Plan
Across the Pond- Marketing Transformed
Episode 9. Creating an Optimum Growth Plan
Marketing Success Criteria
On this week’s show, we’ll talk about the challenge of delivering a growth plan and how to maximise your chance of success. Increase market share, deliver sales growth. Create brand awareness and enhance customer relationships, sound familiar? Probably, because ninety percent of the marketing job descriptions have most, if not all, of these in one line and it’s what we're judged on as marketers right? Even if the full responsibility may not sit with you, we can’t guarantee success but we can maximise it. What do you think Chris?
I totally agree whether you’re a junior digital performance marketeer who’s been tasked with organising the PPC (pay per click) campaign or if you’re the marketing director who’s looking at launching a new market. Those growth targets will sit with you and at least ninety percent of your job description or at least some of that accountability will be there I think. The questions remain the same: is there a market? How much potential? How can you break into it or increase market share? What’s the strategy? What’re the tactics? And that’s pretty much the same whether you’re looking at it on a tactical basis like a PPC campaign or looking at the broad overview service strategy.
But at the same time, Sam, it is going to be horses for courses, but I’d love you to think about the principles we should always adopt when we’re looking through a sales growth plan.
Yeah, I’ll go into that, just for the US listeners horses for courses translates as picking the right solutions for the right opportunity. I don’t know if that’s a corporate answer or a British answer, but the areas you called out make perfect sense.
To break them down even further, I would say look at it from a point of view of the different stakeholders that you need to win with when you’re trying to have impact and drive growth. So, from the consumer perspective, the person who buys. Breakfast cereal is a classic category where kids have pester power but parents have the money to actually buy it- so make sure you understand the difference between consumer and shopper; who are they? What are their needs and unmet needs? Who makes the decision?
Pet food: apparently, animals demand wet food even though they can’t speak and don’t have any wallets or credit cards so, who actually makes the decision and what are the drivers of their choice? Where they buy now, think about the retailers or seller or competitor perspective, what’s their point of view? how does a retailer react to competitors or products? Or, what are their expectations and demands from you as a producer or manufacturer or as a supplier in the marketplace? How important is what you do to them? Does it bring in profit? Does it bring in margins? Does it bring in revenue? Does it bring in media? Does it bring awareness? Think, more globally, into other areas - has it been done in other markets? or how have consumers responded in other places?
Also, to close, look ahead. Make sure you look three, five, seven years ahead and really understand some of those culture drivers, make sure the culture lens is front of mind. How quickly that can evolve and change as we adopt and embrace new behaviours. Think about food, for example. If I’m looking for something to eat or somewhere to go, the first thing I do is look online at the menu and make a choice there, and if you’re not online or don’t have a menu- I’m not even thinking about choosing you so, that’s a big shift from the traditional way of making food choices. In fact eating in is the new eating out. So delivery and all those delivery providers mean that you don’t even have to start a restaurant as a physical location, you can have a kitchen somewhere and be great at creating a brand or a community, which avoids the need for the staff, the building, the equipment, the overheads. Food trucks are the more flexible and agile way of building a food brand, a restaurant brand, and actually a physical establishment which changes the game completely.
No, you’re not wrong. I think that again.
Does that make me right? Does that make me right if I’m not wrong?
I’d hate to go that far but let’s just move past that point…
I think, one of the things that did run true was actually when you look at growth you need to be thinking laterally as well as literally in terms of where it’ going to come from. The idea about food trucks that would have been seen fifteen/twenty years ago as a relatively small market or low value, now it’s seen as a premium market again. In the UK, we’re reading about, in the US, food trucks were such a main part of the culture and it’s over here everywhere now. So, absolutely I think you have to look at the horizons and look at those other parallels.
But I do think there are some watch-outs when you’re trying to look at your growth, when you’re trying to look at your sales forecast and although some of this is a little bit like marketing 101, I still think it’s worth calling them out. Knowing how your sales cycle is going to vary from market to market, I think is incredibly important. You know a lot of people get bought out around that; let’s look at Black Friday for example, Amazon are almost dictating the retail sales cycle now where the sales come and even when they move Black Friday slightly it has a significant effect.
Then there’s Cyber Monday, building on that, and now Cyber Monday’s the thing to plan for and all of a sudden you’ve got four five days of peaks and troughs versus one major event. So, you have to plan it as a whole initiative and not just a one off consideration, so that’s a great call out there.
Yeah, and you know you’re effectively planning your sale cycle on ‘what do we think Amazon will do next?’, which is interesting in itself. That leads onto the second watch-out, which is basing sales purely on past performance. I don’t think anyone’s quite as naïve as to do that, they would look at external factors as well. But the reality is that that’s all we have to go with. In the speed that the markets are shifting at the moment, it’s a pretty dangerous indicator. Looking at what’s happened before and about how you solve that one, trying to formulate that forecast. Trying to look for three data points minimum to give you confidence in that, so what do you think is happening with competitive market share over time, are there any parallels with anyone that’s done this a year or two in advance? Maybe slightly more mature than you? What are some of those external factors? Then, of course, incorporating your sales performance into that as well.
Yeah, I’d add to that if you’re doing that well means you can actually preempt, so you’re not reactive. Knowing that data means that you're actually going to preempt and go a week sooner, a few days sooner or do something to not respond to the market or competitors but actually get ahead of them and get them to copy you versus you trying to catch up with them.
Which Basket to Put Your Eggs In
Totally, totally agree, it’s about playing your own game instead of trying to react all the time. The next one, I think you’ll agree with this one, only preparing for the ideal scenario. I don’t know how many meetings I’ve been in- and I would have been guilty of it at certain points as well, where you’re presenting one sales plan, your talking about growth in optimistic terms, you might mention the word contingency and what will happen but quite often you’re assuming that there is no competitive movement whatsoever.
Interestingly, if I think about some of the categories that I have worked in, there has been a lot of competition- newspapers for example, it was front of mind. But still in the majority of places you can be in danger of doing a sales forecast in isolation rather than looking at what competitors are doing as well. And the final one, of course wherever possible, test before you roll out. Is there an opportunity to learn from what you’ve done in a test scenario? Either in a specific market or a specific region and looking at how you apply that out as well.
There’s a theme throughout this complacency: don’t have a set it and forget it mind-set because that’s when you get caught out. In the last two you said test and learn, having a contingency plan really forcing you to think through and be present and be on it and not to just put it off for a couple of weeks and forget about it and get blindsided. So, the antithesis of set it and forget it is to run what you did last year, so all of those seem obvious- but definitely front of mind when we think about how to do this well.
Building on that, when we look at growth I think again, you can’t just set it and forget it, you have to be looking at other markets, other channels, identifying the next wave, applying something from one sector to another. I was looking at the fastest growth companies there are at the moment and looking at what we could learn and what they had in common and to be honest, we almost always know the answer to this. They’ve identified a gap in the market, they’ve found a customer need that’s not being met, they’ve got a scalable tech solution which can be applied. When the growth happens, they’ve actually found something that can be easily understood, but it’s when you look beneath the surface it becomes interesting.
Fortune posted a list of the top growth countries and there’s the usual suspects in there that you would imagine. Netflix is in the top five, but number one was a dating app in China which really sort of peaked my curiosity, and let us not forget the population in China is one point four Billion people, which is staggering in itself and being caught quickly by India but, this dating app- it’s called Momo, and it has over one hundred million MAUs. It’s a social networking platform, and it’s live streaming revenues alone have risen from one hundred and thirty three million in 2013 to one point nine five billion now in 2018, but that’s not why they’re predicting stellar growth, that’s not the reason it’s number one. The reason why is because it’s a mobile app and it’s predicted amongst other things there’s going to be thirty million wifeless men by two thousand and twenty-three in China. That’s according to the China Daily and now that’s born out of the macro trends during China’s one child per household policy there was one hundred and twenty-two men born for every woman and as time goes past that’s what you end up with, a massive market there.
So, you’ve got a strong market and that is where all of the growth is being predicted and there’s a really nice piece of analysis by Seeking Alpha which is one of those analysis companies, if anyone’s interested we’ll put a link on the blog. But, what’s that got to do with us? Well, on a smaller scale I think the principles are the same. Even if you’re running something like a PPC campaign, your job is to target the audience segments that want your product and your job is to think of the macro trends that are affecting your potential audience, not your existing audience. Spot those shifts of teams from Facebook to Instagram to TikTok before anyone else does, analyse the macro data, get in there first and think laterally, where are those need shifts, who are those micro segments or where the next big mass scale play is. So yeah, staggering growth Sam.
Loyal, or Just Subscribed?
Yeah, it’s exponential growth and opportunity and what we’ve got to be mindful of is how to take something, like the example you just shared, and then play that back to things that are surrounding us all the time. I think the complacency angle is what’s catching a lot of markets out there, where they’re kind of happy with what you’re doing right now and not seeing that growth opportunity, and I think the meal kit industry is another good example. The Blue Apron, HelloFresh, EveryPlate. Brands that give you an affordable at home meal solution. Now, they’re seeing some bumps in the road, is it a fad or is it a trend?
This idea of having the key needs that consumers have are evergreen and are playing forward so, the core unmet need of wanting to surprise and delight themselves at dinner time is something that’s a perennial issue that these companies are addressing, and having the right time and resources to actually meet that need. So, it’s wanting to have experiences, and also personalization is what people are looking for. What these meal kit companies have done really well is, they’re disrupting all the elements of the status quo, continuously blending this physical and the digital experiential elements and injecting excitement throughout it all, and food makes it so easy to win with consumers, because you’re winning with all the senses and not just rational thought. You’ve got taste, you’ve got smell, and all these other things you can play up on food.
A starting point really is just making it so easy to buy. And that’s like an obvious solution to win in the market, with easy online delivery or, in-store pick up now is a growth driver in that sector, and aggressive pricing which is keeping the price of each meal under ten dollars. What’s that? About seven pounds? So, easy to buy, how about making it easy to use and levering technology? Not technology for the sake of technology, but easy to use as pre-measured ingredients, so you’re just opening packets or chopping things up and not having to throw stuff away. You’ve got the prep instructions, recipes printed on cards. Yes, these are digital companies but they’re giving you the physical experience, you can store the recipe cards and make them again in the future, so, that adds value. They make it easy to purchase utensils or other bits and bobs through the E-store. And, then, the online how-to videos to make the meals. Easy to share too and then having a tool kit behind that so, making it easy to send the box back and return things, or the environmental angle of not just throwing everything away, guaranteeing new recipes every week.
So, their idea of making it a habitual thing that you actually look forward to. These unboxing videos on YouTube which get you all excited and make you want to make that thing. How many chicken recipes are there on Pinterest now? They’re using that as a platform. And, the app becomes critical as well in terms of, ensuring that you have that mobile experience for each device, so you’re showing up differently across different device platforms. But, obviously in this industry you’ve got to be differentiated, and where they’re struggling is, are they different from each other? And, are you really loyal? Or are you just loyal to the sector and not necessarily remembering which brand is which? And that’s something to watch out there.
Yeah, that’s a big one I think. Certainly, a theme I think we’ll come back to is around subscriptions, trying to build recurring revenues and making sure that you’ve got that baked in but, that loyalty factor I think is absolutely crucial. I mean, the thing I think you need to look at is: think about competitive threat, make sure you understand the audience, as one wrong move could result in an unprofitable CPA and then, you’ve got an unoptimized sale strategy. Definitely that competitive threat is key. And the growth, I think, goes hand in hand with scalability and cash flow as well. The biggest killer of small businesses is cash flow. Only one in five survive the first year and then, only one in five survive the year after that, and the biggest reason is cash flow. So, it’s not about seeing the growth sometimes, its actually about trying to sustain it as well, and we’ll cover a bit on that next week.
Yeah, and actually, this thing of cash flow as a problem and has become an opportunity. The subscription model is what is solving for that and the idea of this rundle, the recurring revenue stream, or revenue bundle that brands are implementing to manage cash flow, drive revenue, and it’s the dollar shave clubs and the stitch fixes, those aren’t gimmicks, they’re actually building on the business fundamental and rapidly growing because, they’re also solving a key consumer issue; which is, we actually want less choice. We want to make fewer decisions. So, an Amazon subscribe and save is a practical example, and we’re seeing it more and more in media, apparel, travel and health. The offering now, could be a forty pack, or a four pack of shower gel or toothpaste, that’s actually your key selling item that you should drive consumers with. Because if you have a product like, say, toothpaste, and you get through a tube a month, if you get someone to buy four at once, now you’ve locked them out of the market for a quarter of the year so, it’s a smart strategy and also, a recurring revenue because you’re driving (up) the average ticket price. So, all of those things are essential for driving growth. Thinking differently about how you run your business today and what you’re going to do in the future.
How to Track Growth
Well, I think you’ve got to look for the tell-tale signs of momentum, and that comes in a variety form of different formats. I think that’s about customer sentiment, positive satisfaction- how do you track that? I think Trust Pilot does a very, very good job themselves, they’ve got a brilliant business model, but it’s a great way of doing that but also looking at listening as well. Clearly, that individual channel performance, and making sure that your getting a quality audience as well as looking at the quantity. And Google Analytics Suite is a good starting point, I think. You want to try to get as granular as you possibly can and look at every single driver that you possibly can. If you can afford it, Adobe is even better, as you can get more granular. But you really just want to be tracking all the touch points until you can tell what the key leaders to drive growth are and it’s not certain from the outset I think.
Yeah, that makes sense, I’d add to that for perhaps new and innovative organisations or initiatives, think about industry recognition, industry awards, entrepreneurial awards or, an obvious one that has data to support it. Ratings and reviews is another area which is rife for leveraging to ensure that you’re tracking those as artefacts or proof points of the impact that you’re having on the marketplace.
Yeah, good points there, I think we’ll come back to that. But, bring us down to Earth, Sam. How do you achieve this in your own organisation? What is it that we look for in the employees to help us deliver on this?
Yeah, there’s individual and collective traits you can have as a connected team who are really connected and committed in going after it. They’re revenue focused, tracking the revenue that’s going in and the rate of it, really executional focused. So, whether its physically getting it instore or online and merchandising, trying out stuff and not being afraid to fail , the test and learn idea you mentioned before. This competitiveness and relentlessness to want to win, to be there, to be first, to get more. You also need to be clear on how to engage with consumers and drive referrals. I think, one launch I was involved with was very much engaging experiential experience and demonstrating the product to consumers and winning them with that sampling moment, so much so, that they don’t actually just buy it for themselves, they actually would buy it for other people as well. So, that cross-selling and up-selling, and the credibility and credentialing is critical to success. That’s some of the things that come to mind when I think about it but, Chris, talk to us about what a growth situation actually looks like, what does it feel like?
Well, I must admit, sometimes I haven’t been in those growth situations in some markets, like media for example, but where I have been quite pleasantly surprised by growth, an example, early on in my career, with the adoption of the internet, when you’re suddenly there and you’re going “this really is going to be absolutely transformational for everyone” and you’re putting into your sales forecast not just one hundred percent increase, but five hundred percent or four thousand percent increases, and you’re seeing it go up. It can be quite concerning as well as exhilarating.
Second, it’s when you try and get a true, scalable product, I think. Something where once you have written the playbook you can see it set up time and time again. Gaming was a great example of that, I think we were launching at about twenty-two countries by the end of the roll out, and that is quite exhilarating as well when you’re looking at it. But, at the same time that’s all very good, but you have to prepare for that competitor action. I feel like a bit of a broken record there and you have to be sure that you’ve created a scalable product, and we’ll come on to look at that, I think.
Sam, I think you might want to bring us to a conclusion now, are there any further points that you want to talk about?
Well, actually, I’d come back to what you just said about the competitive action, I really think that’s a big enough idea that we should build it into a future show and topic and look at some of the comments coming from what we’re sharing now and actually feed that in. So, let’s shut myself up and come back to more in a future episode. How about that?
Three key takeout’s and reflections of the show
the first one that really comes to mind is ensuring you have both macro and micro trends in mind from the sizing and potential to what’s going on with the consumer. Bit of an obvious one but that macro and micro is critical.
The second thing is to think ahead. Especially regarding culture and where it is today, and where it’s going because it moves so rapidly; three five years and how do you take advantage of that?
And, the third thing I would say is again, perhaps a bit of a 101 but, avoiding complacency. So, you’ve really got to have the right people, the right mindset and entrepreneurial, the EQ and IQ but, complacency here is your enemy. Set it and forget it is not the right approach
So, those are the three points I’d make. The macro and micro, the thinking ahead, ensuring that cultures baked in and avoiding complacency in your thinking and work and in the people you hire.
If I was just to add one more in,
4.I think it would be the importance of a good sales forecast as well.
But, good. Great show, Sam, thank you for that input. I think that was really good. Really stimulating debate. Next show, we’re going to be talking about challenges of growth. How do you sustain growth in the face of blockages? What we’ve been able to do about it and what organisational drivers push you to be making growth and imperative, and how we actually look at technic skills and behaviours to have in your armoury to help you build on that over time. So, going to be a packed show next week, I’m looking forward to it.