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Turn Marketing Expenditures into Sales

Share current LOB: SmallBusiness

It’s not always a straightforward exercise to measure the relationship between marketing expenditures and sales revenue. In fact, 79 percent of business owners in SunTrust Business Owner Research indicate they don’t calculate ROI related to marketing. Owners appear to see marketing as a fixed cost required for growth, but one that’s difficult to measure.

Unfortunately, it’s difficult to manage what you don’t measure. So it’s critical to understand the link between marketing spending and sales, especially for businesses that require a sales and business development process. Typical business owner questions include:

  • Do I hire another salesperson or spend money on direct mail?
  • Do I contract with a lead-generation company or develop a promotional, e-marketing campaign for my existing customers?
  • Do I invest in sales training for customer service staff?
  • Do I leverage billboard advertising?

The research shows that almost 75 percent of business owners indicate a desire to grow their business. In the same way you need a growth plan for working capital and systems, you also need a growth plan that links marketing expenditures to sales and lead-generation output.

Marketing initiatives can take many forms. Consider anything that motivates an existing or new customer to purchase incrementally as marketing. Sales incentives for customer service representatives who upsell, referral programs for existing customers and rewards programs that fuel more frequent purchases are all examples of marketing activities your business can easily track and measure.

Consider the following approaches to more easily link marketing initiatives to measurable sales goals, ultimately growing the bottom line:

Assess your most “profitable” customers and products

Ask your accountant or an analyst to help you utilize financial software to easily code and track profitability by customer and product. It’s common for many businesses to find the Pareto Principle applies to their profitability, meaning 80 percent of profits are generated by 20 percent of customers. By understanding which customers drive profitability, you can more effectively select the customers you cultivate for deeper relationships, as well as the types of customers you should target for new relationships. In general, marketing investments targeted toward a desirable audience are more likely to pay off.

Sell more to existing customers

Most new revenue comes from existing customers. Growing relationships with existing customers is four times as cost-effective as and far less labor-intensive than securing new customers. Customer service and sales training are two of the most effective ways for business owners to leverage their time. By motivating current employees to take responsibility for current customer relationships, you free yourself to focus on new customers and larger deals with existing customers. Plus, employees value the training and the responsibility.


Identify value-added services and products that will add margin to existing customer relationships. Examples include faster delivery, one-on-one product training and support, classroom training and complementary accessories. Use customer-service surveys to identify untapped needs you can fulfill with add-on services and products.

Train customer service and sales employees to work the upsell. Customers may not realize what you offer or have available. By defaulting to what they always order, you’re leaving valuable sales dollars on the table.


Customer service and sales representatives should be motivated to engage existing customers in conversations about new products and services. Create a marketing calendar, and determine the right time for representatives to offer a special introductory offer for another product. Consider promotions such as risk-free trials or deep discounts for a first time trial.

Beware of irritating current customers with perpetual cross-selling, and make sure all of your selling teams are coordinating their efforts. You want your cross-selling efforts to grow your current relationships, not damage them.

Generate and track leads to new customers

Most new business comes from referrals, and yet 40 percent of business owners indicate they do not track referrals or referral sources, according to SunTrust research. Consider the following ways to incent, track and reward referrals from friends and customers of your business.

  • Create a referral protocol so employees know to ask for the referral and feed the information into a database, ensuring the referring customer is rewarded. Use the same tracking system for new customer calls, and always ask how the new customer heard about you. You’ll be surprised what you learn.
  • Use regular customer-service surveys — via e-mail, in-person, or phone — to get feedback on how you’re doing and ask for referrals.
  • Consider a regular e-marketing campaign to send special offers and updates to current customers, allowing them to easily access and forward the e-mails to family and friends. Depending on your business, create a marketing calendar that reflects customer needs and links to a relevant offer.
  • Use social marketing tools such as LinkedIn, Twitter and Facebook, or your online blog, to establish customer inquiry sources you can track.
  • Feed new customer inquiries into a sales pipeline tool. There are many online sales databases and development tools that make it easy to chart progress as you reach out to customers and cultivate sales opportunities. By measuring the length of your sales process and the steps in the process, as well as, the success factors that turn queries into prospects and then into sales, you can create a marketing calendar and appropriate sales training to fuel and support the sales process.


About SunTrust Business Owner Research: SunTrust surveys small business owners and advisors as part of its ongoing business seminars and symposiums. The small business owners attending these events include both SunTrust client and non-client business owners and are representative of the broad spectrum of businesses located in the SunTrust markets. The research cited in this report is extracted from these 5,425 small business owner surveys collected between 2007 and 2011.

This content is general in nature and does not constitute legal, tax, accounting, financial or investment advice. You are encouraged to consult with competent legal, tax, accounting, financial or investment professionals based on your specific circumstances. We do not make any warranties as to accuracy or completeness of this information, do not endorse any third-party companies, products, or services described here, and take no liability for your use of this information.

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