You know you have a great product. Your customers know it’s great, too. There’s just one problem – you don’t have enough customers.
No matter how well-developed your product might be, it’s typically up against anywhere between one and potentially dozens of established competitors in its niche. Competition is inevitable; your success is not. That’s why it’s essential to establish a marketing strategy that fosters connections with potential customers and allows you to stand out from the crowd.
If you’re having difficulty getting started, there are plenty of in-depth tutorials and helpful how-to’s to assist your business in developing a top-notch marketing strategy, including EBQ’s own B2B Marketing Strategy Framework. Guides like these can set you on the right track but, in our opinion, they represent just the first step in a complex process that all hinges on one crucial consideration: How much will all of this cost?
B2B Marketing Strategy Framework: The Ultimate Guide to Business Branding
Looking to create a strong B2B marketing strategy? This guide walks you through planning a data-driven marketing campaign.
Developing your marketing strategy
Whether you’re attempting to develop a strategy on your own or entrusting the job to someone on your marketing team, one thing is for certain: developing a strategy is not free. The time spent on strategy development can’t be allocated to other initiatives or aspects of your business, such as launching and managing campaigns or handling customer communication.
In light of this, you need to consider not only the time it might take you (or your employees) to develop your strategy but also the relative level of efficiency they operate throughout the entire process.
A truly comprehensive strategy takes considerable time to develop, whether you’re just laying out multiple approaches or creating a highly detailed plan for a single channel. A poorly devised strategy can often turn out worse than having no strategy at all. You may find yourself chasing the wrong goals or wasting critical resources on campaigns that won’t produce good results.
You should expect to invest several thousand dollars in capital, time, and intangibles – or a combination of all three – when developing your marketing strategy.
Labor costs to consider
In marketing, the cost of experience can vary tremendously. A seasoned marketing executive capable of executing your strategy can easily cost over $100,000 a year in salary and benefits if you’re searching for serious talent — and you should be. You also need to consider the costs of identifying and recruiting that talent in the first place.
Another cost to consider is turnover – which can be extremely high. At the executive level, it can cost a business 213% of their salary. Even front-line employees can cost a business 30% of their annual salary just to replace. On top of that, recruiters often ask for a percentage of the hired candidate’s first-year salary. It’s not ideal, but losing 10% to 20% of an annual salary to recruiting fees is still far more preferable than losing 30% to 300% of an individual’s salary if they turn out to be a poor fit.
As part of your strategy, you may want to outsource some of your marketing and lead-generation efforts to a specialized marketing agency. These businesses typically charge either on a per-lead basis or on a per-project basis. Some companies – like EBQ – offer an entire outsourced marketing department for a negotiated fee.
Whether you’re hiring internally or outsourcing all of your marketing operations, working with someone with a proven track record is crucial. Any potential hire you identify should be able to point to past successes and highlight data that validates that success – whether they expanded an email list with dozens of new contacts or added a certain number of new leads to the sales pipeline.
Modern marketing is more data-driven now than ever before, and whether you have a fully internal team or a third party handling your marketing efforts, the individuals you select should be well aware of this. It might work out to hire a recent graduate for an entry-level marketing role, but you likely wouldn’t entrust your entire marketing department’s success to someone who just received their diploma.
Make sure you know what you want from your marketing hires upfront so you don’t end up overpaying. If hiring internally, you can check the salary for comparable roles on any number of salary data websites, including (if you’re based in the U.S.) the Bureau of Labor Statistics’ Occupational Outlook Handbook. If you’re outsourcing, compare the proposed project or contract costs to the expected lifetime value (LTV) of all new customer acquisitions the service should be able to generate.
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Operational costs to consider
Will you require new software to execute your marketing strategies? If so, what are your options, and how much does each cost?
These days, the majority of marketing software runs in the cloud. This typically comes with monthly subscription fees for every employee or user who needs access. Some software options serve as all-in-one package solutions for your entire marketing department. Other options are specialized to fulfill certain functions – like providing a CRM to manage leads or helping to automate your funnel’s communications with AI.
As a general rule, never pursue more software than you need. That said, be mindful of the costs you might incur if you need to switch services as your marketing strategy matures. Additionally, while the ROI on your software costs is often measured in operational efficiency, some marketing software can help boost your bottom line just by being more effective at generating leads and helping your sales team close them.
Take time and be thoughtful when assessing your various software options, and always choose carefully! Truly good cloud-based marketing software should be scalable and adaptable, but it should also help you effectively target whatever market you need to succeed. There’s no one-size-fits-all though. For example, a CRM developed for enterprise-level consultancies may not make sense for a start-up company offering a monthly subscription service priced at $20 per user.
In addition to software costs, you also need to consider the cost of potential expansion of facilities in order to execute your strategies – such as rent, hardware costs (servers, networking equipment, computers for your employees, etc.), furniture, and so on. You may not need all of these things, but you will likely need most of them. It all depends on how much you expect your company will need to grow in order to execute strategy successfully.
Advertising and other paid marketing costs
Word of mouth is a great low-cost way to attract attention from potential customers. However, it’s almost unheard of for any company to grow through word of mouth alone. Most B2B enterprises, technology businesses included, often find themselves spending heavily on paid promotions to build out their customer base.
This could include things like paid advertising on standard platforms like Google or Facebook, referral or affiliate programs, promotions run through sites such as AppSumo or ProductHunt, and any other effort where you will be paying for every new lead generated. The costs of paid advertising efforts can vary widely, but they’re typically always measured in terms of their cost per lead (CPL) or cost per new customer – also known as customer acquisition cost (CAC).
If your customer’s Lifetime Value (LTV) exceeds the CAC, you’re on the right track. The greater the LTV, the better positioned you are to justify spending on acquiring each new customer.
B2B Marketing Strategy Framework: The Ultimate Guide to Business Branding
Looking to create a strong B2B marketing strategy? This guide walks you through planning a data-driven marketing campaign.
Wrapping Up
Building a business is never cheap, and after you’ve crunched the numbers thoroughly, you might just discover that getting to the next level will cost far more than you expected. However, carrying out a thorough analysis like this can provide valuable upside beyond simply showing you what it will cost you to grow your enterprise.
With your projections in hand, you will likely find it much easier to obtain financing like angel investments or business loans to fund marketing efforts that may otherwise have strained your company’s budget. If you understand both the costs and the expected ROI of these efforts, you will be in a much stronger position to select (and repay) funding that will be more than offset by your future growth.
Do you want to have a deeper understanding of the costs and benefits of your marketing opportunities? Contact one of our consultants, and we’ll discuss how our outsourcing solution can help lower your marketing costs.
