by Jay Kassing, President of MARQUIS
Marketing has a large role to play in credit unions. Everyone gets that. But how much revenue should we expect marketing to deliver? The math is pretty simple. If your budget is around $200,000, then you need to generate sales from your efforts north of $6.7 Million. How did I arrive at that number?
Marketing has a large role to play in credit unions. Everyone gets that. But how much revenue should we expect marketing to deliver? The math is pretty simple. If your budget is around $200,000, then you need to generate sales from your efforts north of $6.7 Million. How did I arrive at that number?
In the words of Mark Twain, there are “lies, damn lies, and statistics.” So, in the hopes of skirting the whole “statistics” label, I will endeavor to employ simple math.
Take this quick test to see the total dollars required just to break even on your budget.
- Your budget [A]: $200,000
- Your spread [B]: 3%
- Divide A over B $6.7M
In this example, your budget needs to generate over $6.7 million in directly attributed results to cover the cost of marketing. How do your results stack up? Are you consistently tracking?
Many marketers struggle with how to get management to see the power of marketing. Have you ever felt dismissed as not strategic enough, or branded a “cost center” by members of the senior management team? The key is in getting your CEO and CFO to understand the marketing techniques where results (ROI) can be proven.
What is marketing?
Marketing is, in its broadest sense, how your company is seen from the outside. Sure, it’s branding. Yes, it is communicating your products and services. And of course, PR plays a role here also. Marketing is also about generating interest in your company and turning that interest into profitable sales opportunities for your credit union.
If your marketing budget has $200,000 in it, then you must prove that you have generated at least that much (plus a dollar or two) in profit as a result. Or else? What is marketing’s primary job?
Marketing must be about driving sales, rather than being looked at as a cost of doing business. Done right, marketing is the catalyst for growth. Unfortunately, management doesn’t often see marketing in this light. Could this be the reason why budget cuts always find your budget or why you have to fight for dollars?? If marketing is proving their results, then management simply cannot afford to cut it.
There are two kinds of marketing: One that makes you feel and one that makes you feel and act. Which one adds dollars to the bottom line? Which one is a giant black hole that can drain a budget in an instant? Which one can you directly track?
What is your number?
Do you need to generate $6.7 million, $67 million, or $670,000? Obviously, there’s a big difference. Before you can aim for a specific number, you have to know (1) what that number is; (2) how you’re going to get there; and (3) how you’ll know when you have arrived. Do the math, do the strategizing, and of course do the tracking to prove your results…and to position marketing as a key driver of profitability at your credit union.
Jay Kassing is President of MARQUIS, a Texas based provider of marketing solutions including MCIF/CRM software, MCIF services, consulting and direct mail creative/fulfillment. He can be reached at jayk@gomarquis.com. |
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