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Essentials of Sales and Marketing in Contemporary Times

By: Mandeep Bedi

Published On: March 28, 2017

More often than not, sales and marketing departments are viewed as isolated functions that operate in silos and act as internal customers to each other. When it comes to making positive contributions to the company’s bottom line, it is not uncommon to see each department pointing finger at the other. But as they say, ‘when you point one finger at someone, the remaining three are pointing back at you’.

Sales and marketing are no exception to this.

Institutions that embrace marketing holistically and make it the center of their decision-making engine succeed way faster than the ones who don’t.

Ideally, a good marketing strategy renders all hard selling unnecessary. Sales and marketing programs around the world are teaching the importance of providing students exposure to cross-functional disciplines, such as information technology, business law and finance, to name a few. The line between sales and marketing functions is getting thinner, and a sizable chunk of companies have already started hiring individuals with marketing and sales qualifications.

In this blog, we discuss a few advanced concepts of marketing that can be weaved into the overarching business strategy of the organization to impart a measurable difference to those coveted lofty profit percentages in the Profit and Loss statement.

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Customer lifetime value

Customer lifetime value (CLTV) is a concept most businesses talk about in almost every board meeting, but only a few actually keep a track of. Measuring customer lifetime value is quite simple. Below is the formula:

(Average sales per customer)
Multiplied by
(Average number of years customer stays with the brand)
(Initial cost of customer acquisition)

The above formula is the guidepost, but companies can tailor it according to their business operations to arrive at a concrete CLTV calculation formula.

Let’s go through an example. Here are the calculations for a hypothetical mom-n-pop doughnut shop in downtown Vancouver, called ‘Suga Me Up’. For a crafty doughnut shop in Vancouver that subtly imbues sugar addiction, it would be fairly reasonable to assume that average sales per customer could be $5. For this example, we also assume that the customer comes back at least 3.5 times per week to purchase doughnuts and stays loyal to the doughnut brand for an average of 10 years. Given the barriers to entry into the market (high initial setup cost), no other doughnut shop could possibly enter the vicinity, and therefore a 10 year customer loyalty period may seem reasonable to the doughnut shop owner. Let’s also assume that age factor prohibits the customer from getting exposed to any more sugar rush.

When marketing and production costs of $3.5 per unit are factored in, the final average profit per unit becomes $1.5. Let’s calculate the customer lifetime value from this data:

  • Average Sales per Customer (ASC) = $5
  • Average Sales per week = $ 5 x 3.5 = $ 17.5
  • Average Sales per year = $ 17.5 x 52 = $ 910
  • Lifetime Sales from Customer = $ 910 x 10 = $ 9100 (A)
  • Average expenses per sale = $ 3.5
  • Total Expenses = $ 3.5 x 3.5 x 52 x 10 = $ 6370 (B)
  • Customer Lifetime Value = A – B = $2730

The above calculation gives doughnut shop owner a broader perspective on the importance of customer retention and customer delight. When we see nothing but a single customer transaction, it might not make sense to make any efforts towards customer retention. The person at the counter will just see a customer making a trivial purchase of $5, whereas understanding marketing can provide a bigger picture to sales staff and make them aware of the customer’s lifetime value. Seeing a bigger picture can become a motivator for the sales staff to ensure customer satisfaction and possibly customer delight.


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In today’s times, while the buyer is faced with a bazillion choices for every product they purchase, it has become increasingly important for companies to customize their offers and grab customer mind share, as well as wallet share. One fantastic way to do this is to build buyer personas.

A buyer persona is a detailed description of a typical customer, their lifestyle, demographic, income level, hobbies, interests and various other touch points that company can use to push brand recall.

Don’t just make a stop gap attempt at creating buyer personas make them as detailed as possible; go as far as to name them! These personas will help you shape your marketing efforts around them to gain more traction for the brand.

A quick ‘buyer persona’ example for our doughnut shop customer could be Sally. Sally is 21 years old college attendee. She is a food enthusiast, loves to go out in evenings and try new food, is in her prime age and is healthy enough not to think too much about sugar consumption; has sufficient disposable money, likes to try new trends – and so on and so forth.

Leverage Digital

It can’t be emphasize enough how important it is for organisations to focus on their online promotion efforts. Let’s put it this way – if you are not doing it, your competitor surely will. A vast majority of consumers today start their product/service search online. Online reviews and social media recommendations are consumer’s best friends when it comes to making purchase decisions. E-commerce is drilling a big hole into the brick-and-mortar marketing landscape, and therefore it will eventually become inevitable for companies to have at least some basic online presence.

Digital marketing discipline offers a whole bunch of data analytics tools to measure campaign performance and allows you to reckon which part of your online strategy needs to be re-visited. An entire book could be dedicated to digital marketing, and this blog section is only scratching the surface. Here is the starter kit for going digital:

  1. Website: A no-brainer, youd think? Not really! Just having a website up on the web doesn’t guarantee anything. You will need to build your website in line with Google’s webmasters guidelines for search engine optimization (SEO) if you want the search engine to index your website pages. The buck doesn’t stop here: SEO needs a lot of dedicated consistent effort and patience. Companies should opt for digital marketing agencies that have enough success stories to prove their expertise in the domain. Rule of thumb: if the web-development agency promises guaranteed first-page rankings or traffic numbers steer away from them.
  2. Social Media: Choose your social media channels wisely. Think about where your target market audience treads and then plan your strategy from ground up. Post authentic, share-worthy content and engage in influencer outreach on social media.
  3. PPC: For those who can’t wait for SEO efforts to bear fruit, pay-per-click is the faster way to go. Be careful, as it is very easy to lose money if your basics are not clear. Google offers free courses for Adwords and Display advertising take advantage of them. Start narrow and gradually scale your campaign up.

The above three concepts will not only provide an organization’s marketing efforts a refreshed look and feel, they will also help companies measure impact of their marketing strategy.


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