Marketing investments aim to generate awareness and interest in a business’s products or services by strategically managing the 4 Ps: product, price, place, and promotion, with the ultimate goal of driving sales growth.
Primary Implication
The business challenge marketing solves is to get quality customers to show up and buy. Much of marketing is about positioning the sales process to convert people who show up into satisfied customers.
Overview
The primary purpose of investing money in marketing is to create awareness and interest in your business. Typical marketing costs include everything involved with the execution of the 4 P’s of marketing:
Product—the identification, selection, and development of a product or service
Price—the determination of what you will charge to deliver a product or service
Place—the distribution channel you will use to connect the customer with your business, and
Promotion—the development and implementation of how you create awareness and interest in what you do.
The question to ask yourself relative to how much you should invest in marketing comes down to—”Do you have more leads to follow up or customers to serve than you can keep up with? ___ Yes ___ No”
If the answer is yes, then this expense category should be nearly zero. If the answer is no and sales are declining, you have a product, price, place, or promotion problem to solve.
