Research indicates that firms with marketing plans have higher revenues than firms without plans.
The basis of this important fact begins with data. This includes information collected in a database such as current clientele, referral sources, industries, etc. Analyzing the data creates an accurate picture of historical target markets and industries, as well as referral sources. This information is critical in developing future marketing initiatives. Although data collection may seem overwhelming, the resultant growth of your firm makes it well worth the effort.
CHOOSING A PLATFORM
Database information is critical in developing future clients. Various platforms easily and seamlessly aid in data capture. ACT!, Goldmine, Outlook and SalesForce are a few of the different types of programs available. Most commercial databases have fields for referral sources or contain fields for customizable data.
Another platform is Excel, which is an excellent tool for data analysis. In addition to sorting and filtering, one of Excel's greatest innovations has been the pivot table. With pivot tables, you can take an entire database of information and produce graphs that tell the story of marketing efforts. This can be particularly helpful when analyzing marketing success. The analysis also aids in identifying the demographic profile of your clients.
BUILDING YOUR DATABASE
There is a variety of data to collect from current clients. This includes:
The date of client engagement, which will help in tracking the number of new clients per month, quarter and year, and will also indicate any seasonality in business development.
The type of client, such as individual or business, which is important because marketing activities need to be adapted to the type of client.
The client's location, which signals opportunities for geographic marketing around the current clients' clustered locations.
The type of work done for clients helps in identifying growth trends that highlight future marketing.
However, firms often overlook key information to the detriment of their marketing efforts. Three of the most important fields for marketing purposes are:
1. Client industry. This indicates what type of clients you have - e.g., physicians or small-business owners. The value of this data is that the marketing plan can focus on an area where you already have a group of clients. People are impressed when you can point to your other clients that are in the same industry. It means that you work with businesses that look like their company.
2. Referral source name. This reveals the specific people who are referring the clients to you. You should refer your clients and colleagues to these individuals or, if you are in a position where you cannot do so, give them another reward, such as co-authoring an article or co-presenting a speech.
3. Referral source industry. This is important because it allows you to focus on the industries that are the source of your clients. For example, most of your clients may come from attorneys. Based on historical success, you can now construct a marketing plan around future marketing activities targeted specifically to attorneys as a strong referral source.
Not all clients are generated from referral sources that are people. Oftentimes, firms obtain clients through marketing activities such as speeches, articles, webinars, social media, etc. You can capture these activities in the referral source industry field of your database.
SEGMENTING YOUR DATABASE
It is important that you segment your database. You will want to categorize your clients into active or inactive and start segmenting them into A, B or C clientele groups indicative of the revenue that they generate for your firm. Research has shown that small clients that may be in the C category because you bill them so little during the year, using an exponential amount of resources.
Remember that not all clients are created equal. They are all different, and you need to think about them and interact with them in different ways.
Case in point: A firm had many small clients with under $1,000 in annual fees. The firm defined them as mom-and-pop businesses, but didn't want to let them go, even though they consumed a lot of the firm's resources. The theory was that the small clients would one day grow to large companies. In a five-year analysis of historical data, it was discovered that, on average, the mom-and-pop businesses declined in revenue and eventually left the firm. Yet these small firms ate up a disproportionate amount of partner and staff time.
You should also divide your database into subcategories like referral sources or prospective clients. These individuals should receive a different communication from you than what you send to your current clients. Communicating regularly with the various segments is crucial to keeping you at the forefront of clients, prospects and referral sources.
EXPANDING YOUR DATABASE
Continually growing your database is important in your marketing efforts. There are many ways to expand your prospects and referral source segments. The best way is to collect business cards from meetings, networking groups, speeches, etc. You can use social media, such as LinkedIn, to identify potential contacts and invite them into your network, and then input them in your database.
ANALYZING YOUR DATA
Unfortunately, few firms track the source of their clients. Database analysis is always revelatory, and is critical because it helps to determine appropriate marketing. At least once a quarter, depending on the amount of new clients generated, you should analyze the database to monitor both the client industry and the source of the client. The results of the analysis indicate where you should make changes in your resource allocation to optimize your marketing efforts.
For example, in a mid-year analysis, a firm discovered that a large portion of referrals were coming from one organization. As a result, they focused more time on the organization and substantially increased referrals. Another firm discovered that their clients in a specific industry were growing dramatically. As a result, they created a mini-marketing plan for the industry, which helped increase the amount of industry-based clients.
The goal is to spend the least amount of money and generate the largest number of clients. Data analysis enhances the return on your marketing investment. After you have gathered all the data, you can determine which activities and areas you should pursue.
Collection and analysis of data can be time-consuming. However, if done properly, your results will provide valuable insights for growing your client base.
Barbara Lewis, MBA, has been a marketing consultant in the financial services industry for over two decades. Follow her blog at www.centurioncmo.com, and reach her at (818) 784-9888 or email@example.com.