Archives for posts with tag: Lag

The role of marketing is to generate demand for a product or service, and positively influence the chances of a sale or a satisfactory exchange. The role of production or operations is to have it ready so that when a sale happens you can deliver.

Stand and deliver, as the highwaymen and a certain 80’s pop band used to say.

This is not as easy as it sounds. It’s helpful to know your sales cycle, the length of time between when you start creating the demand and the customer wants to buy. Sometimes the sales cycle is miniscule, like in ecommerce, so you need to be ready to deliver on the upsurge in demand. Otherwise, goodwill wanes proportionally to the amount of time you have to wait after you’ve placed your order.

Last year I ordered a rather nice brand-name top from a website I’ve used for a couple of years. They used to send me a daily email with their offers. They complete on value and totally wing the service and delivery side. I ordered the top the 3rd week of February and it arrived the second week of May. I don’t know why it took so long; the possible reasons are many. Once I got the top I unsubscribed and they get no more business from me.

In the business to business world, it’s also helpful to know how long it will take you to build your product or service, and also how long it will take for your people to be able to deliver and support the product or service. If you’re lucky, you can do some of these two things in parallel and save a bit of go to market time.

 

When you’re in marketing and sales, you’ve got to mind the gap, otherwise you may never emerge from it.

It doesn’t matter if you’re a start-up launching a new business, a business launching a new product, or a company planning its sales targets for the next 4 quarters, there’s always a gap for marketing and a gap for sales.

By this I mean that there is a lag effect. The marketing lag is from the time you start thinking about marketing to people, actually marketing to them with your finished content, to someone putting their hand up and saying ‘Talk to me, I’m interested.’ The sales lag is from the time someone puts their hand up, through the period of qualifying whether they’re a good fit for your business, through to them signing the deal. Add the marketing lag and the sales lag, otherwise known as the sales cycle, and you’ve got a pretty big gap before you’re turning your stuff into cash.

So, if you’re a start-up and your product’s not ready yet, you need to start marketing right now: blogging, tweeting, emailing. Building up a head of steam so that you can have real conversations once your product is ready takes at least 6 months. That’s half a year, which sounds much worse than 6 months.

Same if you’re an existing business about to launch a new product. You have to mind the gap, similar rules apply. And if you’re building your 2019 financial year’s sales figures, you need the marketing to kick in in 2018. Companies selling complex products and services with a 3-month sales cycle will not see any marketing activities from one quarter converted to sales in the same quarter. It might not be the quarter after that either, when you factor in the sequential lag time of the marketing and sales gaps.

How many companies who do a business plan for year Y plan the marketing effort for year X? Not many. And certainly not the ones who finish their year Y plan at the very end of year X, or even the start of year Y. Those companies can write off any help at all from marketing, probably for the first half of the year.