Marketing expenditure should be viewed as an investment not a cost.

This is true, but from small to large businesses, there’s often a sneaking suspicion about marketing spend, particularly among non-marketers.  This may be partly attributable to the lack of hard-nosed evaluation by some marketers.

But everyone seems to want low-cost marketing, so we should explore the concept.  First, an option that looks really low-cost, but can turn out to be very costly – marketing without a plan.  If your marketing and promotions are a knee-jerk response, you’re just as likely to fail as to succeed, and worse, you won’t even have a clear idea why.

A simple marketing plan is the best low-cost marketing investment you can make.  What does it need to contain?  A few sections, which you can cover in just a handful of pages.

1.  Understand your products
We’ve all done it before, but just one more time, what are the perceived benefits of your products?  Never forget, that’s why your customers are buying your products or services and it should be at the centre of your marketing plan.

2.  Define your markets
Who are your target customers? Where can you find them? How can you communicate with them?  Are some customers more important than others?  Do they buy more?  Are they more loyal?

3.  Understand the role of price in the purchase decision
Some products are bought on price alone, for others the price is almost immaterial.  The emphasis in other aspects of your marketing will be heavily influenced by the relative importance of price.

4.  Plan your marketing communications, based on what you have learned
This can be as simple as something like:  “Most of our customers live within five kilometres of our business so only local communication channels will be used”.  Or:  “Our customers are mainly adults with children, and are aged over 30, so local press will be a good way to address these people”.  Or:  “Our customers are mainly aged under 18, so local bus shelter advertisements will be utilised”.
5.  Monitor your marketing and refine it
There are many low-cost ways of tracking the impact of marketing communications: bonus offers with a particular ad, coupons in press ads, even using different phone lines for responses to particular offers.  And finally, don’t forget to have your sales staff ask new customers where they found out about your business.

Making the most of your marketing budget
How can you build word of mouth and referrals?
The most potent, and often the cheapest marketing is word of mouth, so you need to examine what it takes for today’s customer to tell a friend tomorrow.  It may be excellent service, it may be a special product, or even a special price; anything that leads to referrals is a good investment.  Indeed, a special budget may be justified to give rewards to customers who deliver new customers.