Do I Need To Invest in Marketing When My Business is Thriving? (+ Video)
For far too long, marketing has been seen as a business expense.
When times get tough and budgets shrink, the marketing team (and the marketing budget) are generally the first to be let go. Simultaneously, when business is booming and it’s time to grow, businesses often seek to hire sales teams first.
All of this is exacerbated by one huge problem: It can be hard to accurately measure the return on investment (ROI) of your marketing efforts. If the results are hard to measure, the value is easier to dismiss.
But choosing to view marketing as an expense that can be cut is a short-sighted approach, and it can lead a business into dangerous territory.
Marketing is what ensures the future success of your business. If you’re not continually investing in marketing, you may be sowing your own collapse — not in the short term, but sooner than you’d think.
Instead, you need to commit to investing in marketing every month, when your business is booming and when your phone goes silent.
Below, I’ll cover:
- Why even word-of-mouth businesses need to invest in marketing.
- Establishing a “minimum standard of excellence.”
- How today’s marketing activities set you up for long-term success.
Free Guide: The Ultimate Inbound Marketing Strategy Playbook 2022
Success can breed laziness
When companies are bringing in more leads than they can handle, they’re glad to have as many sales reps as they can afford. After all, when times are good, marketing is seen as superfluous.
Prosperous businesses find themselves asking these two questions:
- I’m growing and I have more business than I can handle; Why do I need to spend money on marketing?
- Why do I need to build brand awareness and bring in more customers when I’m doing well?
For an in-depth answer to these questions, I asked Marcus Sheridan — author, speaker, and small business expert — to see what he had to say.
You can watch our entire 23-minute discussion below, or keep reading to learn more.
“I’m a word-of-mouth business: I don’t need to spend money on marketing”
Being a word-of-mouth business can be great. It’s a reflection of the good work and attentive customer service that are hallmarks of your company.
However, it’s not as good as it sounds because it’s not as durable as it seems.
Simply put, word-of-mouth is fragile.
Marcus puts it this way: “Whenever I hear someone say ‘We’re a word-of-mouth business,’ I think the same thought: They’ve never been through a recession.”
If a recession hits, cost suddenly becomes the biggest differentiator buyers use to make purchasing decisions, and quality and service are less of a factor.
Or it might not be a recession. Maybe a few bad reviews on Yelp or Angi start to make customers go elsewhere. Or new competitors enter your marketplace and do an advertising blitz with promotions that rattle your customer base.
Whatever the reason, you could have a few bad months and suddenly the phone is not ringing like it used to.
Therefore, it helps to have a backup plan that can supplement your referral network so you can weather any storm and scale your business, even if word-of-mouth becomes less reliable.
Often when the economy turns south, there simply are fewer buyers. People watch their budgets and push off or scale down purchases. Even the most robust word-of-mouth businesses are left scrambling.
And when they are, they all say the same thing: I wish I had a marketing foundation I could rely on now that my referral leads have dried up.
Investing now in inbound marketing can help you shore up for the challenges that might lay ahead.
Marketing helps your business keep its eyes on the future
According to Marcus, it’s critical that businesses plan for the bad times in the midst of the good. In other words, even when you have more business than you know what to do with, you need to anticipate trouble on the horizon.
“I call it ‘the fat and happy syndrome,’” Marcus says. “Companies rest on their laurels because times are good, and then they sit back and forget what it’s like to have to struggle and fight for deals.”
This is sometimes referred to as the pride cycle:
- When times are tough, you work hard to dig yourself out of the hole and improve your situation.
- Through that hard work, you begin to turn your fortunes around. Things start to get easier.
- So, you take your foot off the gas and start coasting.
- Before you know it, you’ve lost your momentum and are headed back toward struggle.
If you’re fat and happy now, keep up the work that got you to this position.
Sometimes, a pending struggle is due to your own lack of preparation. Sometimes it’s due to larger economic factors beyond your control.
When times are good, be ready for a change
If the COVID-19 pandemic has taught us anything, it is the ability of our plans to get disrupted. The pandemic’s fallout has been massive and erratic.
Certain industries were nearly wiped out, laying off workers and shutting down production. Other industries went into overdrive, posting incredible growth and revenue numbers.
Although global events like the COVID-19 pandemic are far beyond our control, ups and downs are part of business. How you prepare for them will be a key to your prosperity and longevity.
There are three things you need to do to prevent slipping into decline:
- Know that hard times could be around the corner.
- Build good habits.
- Invest in marketing — even if you’re a word-of-mouth business.
Build good marketing habits: Establish your “minimum standard of excellence”
Habits are hard to break. Once they’re well-established, habits become part of who you are and what you do.
Do you walk the dog every morning? Exercise? Read the paper?
Every day, there’s a series of habits that form your routine. If something happens that disrupts those habits, your whole day is thrown off. You don’t feel like you.
Marketing is, above all else, an investment in the future of your business. It is a habit you need to build.
Just as you invest each month in your retirement account, your kid’s college fund, or your “I’m going to buy a boat someday” fund, you need to invest in marketing. Without the habit, that far-off goal never gets any closer.
Marcus believes that all businesses should have certain standards of excellence, just like people. These are the habits that make you who you are.
“I go to church every Sunday,” he says. “If I’m on vacation, I still go to church because that’s who I am.”
Your business has habits, too. They’re likely so routine that you don’t even think about them.
For instance, you make payroll every two weeks. To miss it would break a promise you made to your employees.
Marketing, says Marcus, should be like payroll. It should be like him going to church. It should be something you commit to doing at a certain threshold every month, whether times are fat or lean.
This is the minimum standard of excellence. A habit you build that keeps you committed.
You can always do more than the minimum standard of excellence, Marcus says, but you should never do less. Establish that minimum — that investment you’re going to make every month, no matter what — and then stick to it.
Let it be a part of who you are.
During the good times, you can afford to over-invest
Should you invest in marketing when times are good? Yes. In fact, you should over-invest.
When times are tight, you’re watching every dollar. When times are good, you have more money to play with. That’s not to say you should be careless or wasteful — just that you have the freedom to over-invest and explore different opportunities.
Maybe there’s marketing software you’ve been planning to get. Or a new piece of equipment. Or a new hire you’ve hoped to bring on. You can better afford to do these things when business is booming. That way, if you begin to struggle, those new elements are already a part of your business.
For example, investing in HubSpot is one of the soundest decisions a business leader can make.
HubSpot provides incredible efficiency, and it gives you the data you need to make better decisions, but it’s not free. You have to pay monthly for the service. (Note: There is a free version of HubSpot, but you’ll want to spring for Starter.)
If your business is in a tough spot, you’re unlikely to find the cash to start investing, but, if times are good, you might have the money available.
Smart investments will pay dividends. Heck, the investing you do today might even prevent you from suffering during the next downturn.
Invest in marketing: Plant the seeds for tomorrow’s success
They Ask, You Answer is a business framework that has helped thousands of businesses chart a path for long-term growth. It was also born from a recession when Marcus turned to content marketing to save his pool business.
The premise is simple. If a customer has a question, a business should supply the answer — and do so openly and honestly. When a brand answers buyers’ questions, it will develop trust among the target audience, in turn, attracting more clients and increasing sales.
Today, IMPACT teaches clients to implement They Ask, You Answer at their companies.
When companies go all-in on this framework, it becomes a part of their identity. It becomes the digital marketing strategy they employ in good times and bad.
They Ask, You Answer delivers a hefty share of short-term wins.
When you produce content that honestly and openly answers your customers’ questions, you can immediately plug that content into the sales process to help turn prospects into customers.
We call this practice assignment selling. (To learn more, check out this free course.)
But the other half of They Ask, You Answer is inbound marketing: Using that content to attract customers through organic search. This can take longer. Weeks at least. Often months.
So, to attract next year’s customers, you need to be producing content today.
There’s an old saying: The best time to plant a tree is 20 years ago. The second-best time to plant a tree is today.
Anticipate your future needs and get that content out there. You’ve got to get those seedlings in the ground so they can start to grow.
“When winter comes,” Marcus says, “you can’t suddenly plant the fields and expect there to be crops. It doesn’t work that way.”
In an uncertain world, marketing is something you can control
The success or struggle your business experiences is not entirely up to the choices you make.
Yes, you make the decisions and put in the time to set the course for growth and prosperity, but events beyond your control can hurt your outlook. This could be anything from a supply-chain disruption to a two-year global pandemic that wreaks havoc on global commerce.
There are always going to be factors beyond your control — but there are factors beyond your control in every aspect of your business. You still make payroll every two weeks.
Marketing is something you can control. Your investment should not slacken, no matter what’s going on outside your door.
This is the surest way to deliver long-term stability and growth.
Marketing is a commitment to your business’s future
When Marcus went all-in on the framework now known as They Ask, You Answer, he was a struggling business owner trying to ride out the Great Recession.
He committed to writing three inbound marketing articles each week, no matter what. After all, his back was up against the wall — and he was fighting to save his business.
Now, nearly 15 years later, River Pools is still publishing two or three articles each week, 52 weeks a year.
Today, River Pools is a franchise with 25 locations in 18 states. Its website is the most trafficked pool website in the world. But that success has not led to complacency.
Every week, Marcus’ team is turning out new content to answer customer questions and re-establishing River Pools as the go-to source for buyer education in the industry.
Historian Mark Pendergrast once reported that Coke (as in Coca-Cola) is “the second best-known word on Earth, after ‘OK.’” Still, Coke spends about $4 billion per year on marketing.
Why? Because marketing is an investment in the future.
It’s easy, when times are good, to assume that you’ve built momentum that will carry on forever. But thousands of businesses fail each year for this reason. They never made the initial investment necessary to reap the long-term benefits.
If you want a prosperous future, you need to plant the seeds today.
To learn more about how IMPACT helps businesses build a recession-proof future, talk to one of our advisors.