Finance and Marketing; the two go hand in hand when growing and maintaining your business. The problem is, small business owners often get lost in the day to day dealings of the business – and lose focus on growing their business. This means marketing falls lower on the priority list.
So let’s try and rectify this!
Business numbers
Before you embark on a marketing campaign, it is important to first understand your business numbers. These are things like
- turnover
- profit margin
- average dollar sale.
Something as simple as knowing your numbers – and what they mean for your marketing strategy – can help ensure you are putting time into products that work. This way you can hit your targets, while knowing what you need to do, to get where you want to be.
This is why we think that marketers and accountants should work together for your business. So that you understand how important the numbers are to your marketing and vice versa.
Knowing your business numbers and spending time with your accountant to really understand what they mean for your business is so crucial when marketing a small business, as generally cash flow is tight and product/service profitability is essential.
Three Reasons why Accounting and Marketing go hand in hand
- Understand how much money it will take for your business to be sustainable
Working with your accountant to go through your turnover and profit margins allows you to understand how much money it will take for your business to be sustainable and grow. This directly correlates with how much work you need to bring in to ensure that your business is sustainable. When you know your break-even point you know what you should aim to bring in a year/month/week and how through marketing you can get there. - Understand your most profitable products/services
Working with your accountant to understand your most profitable products and services can help you to identify which of those you should focus your time and marketing efforts on. If you don’t work this out, you may be wasting time promoting a product/service that is not making you money.
It can also help you to identify where there is room for improvement and where you can work on increasing your profitability (ie. outsourcing vs insourcing, wholesale vs retail). - Understand your pricing – and what you need to charge for your products/services
Working with your accountant to understand your pricing and what you need to charge for them, in order to make a profit will allow you to ensure your pricing is profitable for your business. It will also mean you can compare that to the market average in your industry, to ensure you remain competitive.
What you can measure you can manage – this old saying is so true.
When your marketing campaign is up and running make sure you are tracking the results – both the financial ones like impact on turnover, average sale value and bottom line, as well as the leading KPIs such as number of leads received and conversion rates.
Tracking these will enable you to monitor and evaluate the effectiveness of a marketing campaign.
