Scaling a business requires achieving the economy of scale while selling the products or services to a large number of customers. To achieve economy of scale, the per unit cost of output must go down as the production increases. The output of consulting firms is intangible services that vary with each project. Thus, they can’t produce standard services at a large scale. The service production and the delivery are limited by the availability of time and the skilled manpower.
Thus, the revenue of a consulting firm is a function of time, competencies and number of its employees.
Revenue of a consulting business -> f(Time) + f(Expertise)
To scale the operation and grow revenue, a service company must follow these three rules:
Rule No. 1 – Provide one Niche Service
Master a skill set and provide one service that is significantly better than the competition. It serves three purposes:
Firstly, for exceptional services, most of the clients pay a premium price. With time, the average ticket size and the margin go up which results into increase in revenue and profits.
Secondly, big brands like to work with the best in the industry. If your services are better than that of the competition, you may get an opportunity to work with the big brands. An addition of one big brand in the portfolio can increase the revenue manifold.
Finally, managing the business growth becomes simple with one service. Hiring even one or two experts in the field can provide enough bandwidth to service many more clients. Whereas with multiple services, you need to hire many professionals to service just one customer.
Rule No 2 – Track Time Spent on each activity
“You can’t manage what you can’t measure” – Peter Drucker
The revenue of consulting firms is directly linked to the number of Manhours they put to deliver a project.
Tracking time helps in pricing the services, deciding the compensation of team members, making the right commitment to the clients, and preparing a roadmap for the future of the company.
Moreover, for a five members team, even 1% improvement in productivity per person per day is a huge gain without any pain at the end of the month.
Thus, tracking time and improving efficiency goes a long way in scaling the business operations of consulting firms and increasing their top and bottom lines.
Rule No 3 – Develop three Processes – Service Delivery, Client Acquisition, and Talent Development
Processes are the bedrock of growth of any service business. Irrespective of the number of team members, an ambitious firm must develop processes and adhere to them to conduct business activities. Over time, the processes can be innovated and improved to accommodate emerging scenarios and circumstances.
Develop following three set of processes:
- Operational Processes to deliver exceptional services
- Business Development and Marketing Processes to acquire bigger and better customers
- Talent Development Processes to hire, train, manage and retain employees and partners
Once developed, all team members must adhere to the processes irrespective of the size of projects or urgency of deadlines.
Explore the options to automate or outsource a part of the processes and increase your focus on core competency and business growth. It makes business growth a simple and pleasant experience.
Businesses which sell products take advantage of all three rules by default for scaling their operations. The service providers, on the other hand, lose focus by adding multiple services in their offerings and then struggle to maintain and improve the quality of the services. They can accelerate their revenue growth by concentrating on their core competencies and innovating in the way they deliver services.
To increase sales immediately or in a short timeframe, you need to reach out to more people who are interested in buying your product. Until people know about your company, they won’t buy your products or services. Thus, you need to improve your brand’s visibility among your target audiences immediately.
Here is how you can find the relevant people and target them through ads:
Register your products and services on online marketplaces that operate in your niche. Most of these marketplaces thrive on their massive marketing prowess and brand name. They also have a fraud detection and prevention policy that protects both, buyers as well sellers. Therefore, shoppers prefer to purchase items from established online marketplaces.
Competition from similar vendors and lack of ratings and reviews make it hard for new sellers to make a mark. However, with an excellent product description and some promotion, you will soon see the sales going up. The best part of online marketplaces is that most of the serious buyers visit their platform and therefore, your promotion becomes highly targeted. Also, you will have to pay a commission on each sale which is far better than paying for clicks or impressions.
Tip – Register yourself or the firm with a reputed platform and take their best membership. Promote your products aggressively in the marketplace. Try to get first few ratings as soon as possible.
Targeted Email Campaigns
Email marketing is still very efficient when it comes to generating leads or increasing sales immediately. You just need to find out the high-quality email database of your target audience. Connect with email marketing service providers who have the database of your target audience and also have explicit permission from the users to send promotional emails.
For example, one of my clients runs a post-graduate certificate program that is mostly preferred by fresh engineering graduates. For a consulting assignment, I suggested them the name of few job portals which cater specifically to engineering graduates and also have an email marketing platform for companies. We ran the campaign, and it was a huge success. Three years on, the company is still using the email marketing services of the job portals. The long association itself is an indicator of the success of the campaign. As of now, I have suggested this technique to many clients and most of them have found it useful.
Tip – Use email marketing if you can have access to a precise database. Email marketing in not sustainable if you target a broad range of users. Also, don’t depend on service providers to write campaign copy or design creatives or landing pages. Get all of these done from your end and to your satisfaction. Only use their platform to send emails.
Affiliate Marketing is a performance based marketing method in which the advertisers pay for per action. You can decide to pay for each lead or the sale depending on the nature of your products or services. Affiliate marketing is the source of customers for a majority of e-commerce firms. Usually, affiliate marketing campaigns take 3-6 months to start delivering returns. Also, you either have to spend significant time or hire someone who can handle the affiliate marketing for your business. It requires full attention from an experienced marketer to hire, train and encourage experienced affiliate marketers to promote your business.
LinkedIn Ads are expensive and not appropriate for all kind of projects. However, if your products appeal to a section of working professionals, LinkedIn Ads can be very useful. I got my first two clients from LinkedIn. While the first client turned out to be a scam artist, the second client was hugely profitable. When I created my company page on LinkedIn, I received an advertising coupon worth $50 from them. I added $50 from my end and ran a campaign for $100. I received three leads out of which two got converted. As I pointed out, one of them was a scammer (who got the work done and never paid; he was in the business of defrauding new entrepreneurs). The other client worked with us for quite long, and they also gave us few referrals. As of today, we have generated a business of worth more than $20,000 from them as well as their referrals. You may call it luck, but we got an excellent ROI, to say the least. I have seen similar success for my B2B clients.
LinkedIn has immense potential. If you are operating in B2B segment and have a significant budget, you must try LinkedIn ads.
Google Adwords is still my favorite advertising program to generate leads. Over time, it has become complex and expensive. Still, the ROI on Google Adwords is much better than other advertising programs. Most of the businesses make a mistake in hiring a professional to handle Google Adwords campaigns. Or pay a small fee for their services. AdWords requires a lot of attention from advertisers and campaign managers to deliver results. Otherwise, you will end up paying for irrelevant clicks or higher cost per click rates. Thus, always hire an experienced professional or an agency who can spend significant time on your AdWords campaigns.
Well, I am not sure if I should recommend Facebook Ads. Many advertisers have claimed a huge response from Facebook while many others have made complaints about fraud in Facebook advertising system. Many of my clients say that they receive good responses from Facebook ads, but conversion is very low. In many cases, people have entered incorrect email ids or phone numbers. Also, in some cases, people claim that they never filled any form or provided their contact details. After working on Facebook ads for four years, I recommend it with a pinch of salt. Usually, Real Estate, e-commerce or similar firms see a good response from Facebook. Facebook ads are also good for Mobile App downloads.
Disclaimer – I use Facebook ads to promote my blogs. However, my aim of the promotion is to improve readership and not leads. I will write a detailed blog post on Facebook Advertising later.
For me, LinkedIn and Online marketplaces have worked wonderfully to increase sales. A majority of my clients are also satisfied with the responses they have got from Google AdWords and email marketing. I have planned to use Google AdWords and Affiliate Marketing extensively for my business in 2017. I will keep you posted about the ROI as well as few tricks to save money on Ads while generating a better return. Do subscribe to my newsletter to stay in touch and get quick tips on digital marketing.
If you have tried any other online marketing techniques to generate sales immediately or in the short term, please share your experiences through comments.
“Lack of direction, not lack of time, is the problem. We all have twenty-four hours in a day.”
Focus plays a critical role in the success of any individual or business. No startup would have ever become a giant company without focussing on their most valuable product or service. If you are planning to start a business, focus on one thing in which you are an authority or intend to become an authority. If you are already running a business and want to scale it further, focus on the core competency. And get rid of cosmetic products which add no or insignificant value to the revenue.
Focus helps companies in the following ways:
Focus boosts your expertise in a particular area. In the era of stiff competition, trust is the main differentiator for businesses. You can’t win the trust of your customers until you are an expert in what you do. Most of the successful companies first focus on one product or service to scale their operations and build a brand and then grow their business through mergers and acquisitions. Google wouldn’t have become what is it today if they would have integrated features of YouTube, Facebook, and Gmail into a single product. Accenture would not have emerged as a large consulting firm, had they started selling project management software.
Any product or service has enough demand to make your business big. Scaling a business with a single product or service is far easier than a company that has a wide gamut of goods. Service providers need to understand the concept of scaling their business before launching just another service. If you focus on just one service, you can find or train employees quickly to increase the bandwidth.
If you understand something better than your competitors do, you can create multiple pricing layers. For an expert advice or value added services, you can charge a premium price. The cost of production will also decline as you scale your business and thus overall profit will increase.
Your customers will be ready to pay a premium price for the expertise that you bring to the table. Therefore, your profitability will be higher than the competitors in your particular niche.
Focus on a particular niche and do it better than others until you want to be a mediocre company. There is nothing bad in being average as long as you understand that the mediocre businesses have a limited scope of growth. In difficult times, they are the first ones to shut their shop. The traditional startups which provide services face a lot of challenges in scaling their business. Until they are small and have few people, they tend to provide many unrelated services to their clients. However, once they try to scale their operations, things tend to become unmanageable. If you are facing a similar challenge in scaling your business, then try to focus on one service that is generating a significant chunk of the revenue. Once you set a direction for your business, you will see an increase in income and profit over time.
Digital marketing is an immensely powerful tool indeed that you-a business owner can use to reach out to your customers and prospects. The ability to interact directly and converse with potential customers as offered by digital marketing makes this tool far more effective than conventional marketing.
To bridge the gap between the businesses and the digital world, digital marketing agencies come into picture. A digital marketing agency is a company that leverages everything digital to drive results for your business. So what does a digital marketing agency do?
A digital marketing agency first analyzes your business, understands your business objectives then based on that analysis and understanding formulates a digital marketing strategy in collaboration with you and implements the same across the technological communication channels like social networks, mobile devices, PPC advertising, websites, SEO, SEM etc. It holds itself responsible and accountable for the digital marketing strategy being implemented and ensures that the implementations reap desired results for your business.
What are the services offered by a Digital Marketing Agency?
It is highly impossible to come up with an exhaustive list of the various services offered by a typical digital marketing agency. From search engine optimization to social media management to PPC advertising the complete spectrum of digital marketing avenues are simply listless. But as a business owner you may want to be sure that your agency offers the required set of services that your specific business needs. The typical services offered by a agency are briefly explained below:
SEO: In addition to getting traffic and improving search engine rankings, Search Engine Optimization helps your site to be useful to your customers and prospects in terms of the content you create and the way you organize it.
Social Media: Your DMA should ensure that you generate leads, revenue and new customers from social media and they should make sure that you get great returns on your investment out there. The goal is to reach out to your audience, retain their loyalty and drive conversions of followers into buyers. Managing a positive reputation for your enterprise across the social platforms is a crucial service offered by your agency. They do it by increasing customer satisfaction and by halting smear campaigns. Leads and sales get increased by increasing conversion rates. This is achieved by removing usability frustrations from your websites, removing the road blocks to conversion and putting the efforts into test and regular measurement so as to derive insight into further enhancements. Thus conversion rate optimization is achieved.
Email Marketing, digital advertising and analytics are the other important areas where agencies play crucial role so as to derive the maximum from the digital platform.
A full service DMA submits you a detailed digital marketing plan and takes care of the successful implementation of the same. The implementations are analyzed, tested and measured regularly to ensure their effectiveness and continuous improvements.
Digital marketing is not a replacement to the conventional marketing, it adds further value to the existing marketing plan and operates in cohesion with it to leverage the digital platform for added business values like increased sales, increased customer satisfaction, improved corporate repute, enhanced brand awareness, needless to say more revenue!
ROI, or return on investment, is perhaps the only real way to assess whether your online marketing campaign has been a success or money down the drain. It is only natural to expect tangible results for the hefty sums of money spent to keep your digital marketing endeavors afloat. Natural as it may be, it is definitely not an easy assessment to make. Here is a checklist of six sure-shot ways to measure ROI on your digital marketing operations:
- Number of people reached: The basic aim of a digital marketing strategy is to reach out to a wide base of target audience or potential customers with the click of a button. Therefore, assessing the number of people reached through a online marketing campaign is the best way to determine whether the ROI is positive or negative.
- Number of engagements: Are your target audience noticing your online marketing efforts? A clear indicator of this would be the number of engagements you generate through clicks, likes, shares, discussions, and comments on posts pertaining to your product or service. The higher the level of engagement, the better the ROI.
- Number of visits: The entire pitch of digital marketing is to increase traffic to your website. Naturally then, total number of visits to the main website is one of the clear indicators of how well a digital marketing plan is working, and thereby, an effective means of calculating ROI.
- Click to Visit Ratio and Bounce Rate: All clicks don’t necessarily result in visits. Therefore, it is important to know exactly how many of ad clicks are translating into actual visitors to your site. It is, thus, important to an appropriate PPC medium. For example, Facebook has low cost per click as compared to Google Adwords but in terms of drawing traffic to a website, Google Adwords is still the king. The second crucial factor to watch out for is the bounce rate. It determines the tendency among visitors to leave a website without having fully explored it. Let us say a user visits your website after discovering it on a social media site or through a Google search, and exits after browsing the homepage or landing page– without making any purchase or clicking on further links – the purpose of your digital marketing campaign has failed. Therefore, a high bounce rate is a clear indicator of poor ROI.
- Number of Conversions: This is a positive and one of the most critical factors to look at while assessing the ROI. It is also an easy to quantify parameter that never yields misleading results. Making purchases, clicking on links, completion of lead forms are some of the ways in which conversions can be measured, depending on the nature of your operation. A high conversion rate translates into a profitable ROI.
- Cost of Lead Generation: This is yet another highly quantifiable metric for assessing the ROI. An analysis of number of leads generated over a specific period vis-à-vis the amount of money spent on digital marketing during that period will give you the cost of lead generation. Being able to achieve a high number of leads at a relatively low cost accounts for a good ROI.
Likes and shares on popular social media sites equals success in the online world – this is a misconception a vast majority of business managers base their social media campaigns on. However, it is important to bear in mind that likes and shares are a means to help your business model succeed online and not an end in itself. To make a social media campaign successful, it is imperative that business owners have clearly defined goals in mind. Asking the following five questions before formulating a social media campaign will go a long way in swinging the results in your favor:
- What are your targets and budget?
Even before you conceptualize a social media campaign, you must have your targets clearly chalked out in your mind. How many people do you intend to reach out to? How many likes, shares and reposts or followers are you looking at the end of the campaign? How many sign ups are you aiming at? The answers to these questions should be clear to you right at the onset. Budget should also be kept in mind while deciding the campaign. Huge goal with miniscule budget will ruin entire campaign.
- What is the duration of the campaign?
Are you looking a short-term campaign for promotion of a particular event or to announce the launch of a new service or is it going to be a long sustainable campaign aimed at building a brand image? The answer to these questions should determine the approach you adopt while launching a campaign. It is always better to be specific about the duration. So you should be able to answer clearly for how many days/months you intend to run the campaign? What is the minimum time you are willing to give to your campaign to measure its success? Remember that a brand building exercise can’t give results in 2 month similarly you can’t wait for 2 months to make your first order from ecommerce site.
- Who are your target audience?
The demographics of your target audience such as the age, gender, profession, interests and location, should also be pre-determined. With this knowledge to fall back on, you can use the right communities, forums, discussion groups as a launch pad for your social media campaign. This allows you to reach out to the targeted audience without wasting time on the ones who wouldn’t be interested in your product or services in the first place.
- Which medium yields best results?
Many business owners start their campaign on all popular social media platforms like Facebook, Linkedin, Twitter, Pinterest, Google+, and Instagram, but are unable to sustain them for long. Therefore, it is important to focus on social media sites that are conducive for promoting your company, products or services. For example, a recruitment company won’t benefit much from a social media campaign on Instagram. It is best to limit your campaign to a maximum of three most suitable platforms in the beginning, and further expand or reduce the channels as the campaign progresses. Besides, choosing the right creative content is essential for engaging the audience. For example, choosing the right #hashtags is crucial for success of a campaign being run on Twitter.
- How many elements does your campaign involve?
It is important to be clear about how many elements you intend to involve in a given social media campaign. Would you just like to post existing material on social media sites or prefer a more extensive campaign involving conceptualization, writing ad copy, creative design, posts and performance measurement? Clarity on this factor will help you in hiring the right kind of professionals for the job.
- What are the tools you are going to use to measure the performance of your campaign?
There are an umpteen number of tools and methods available for ascertaining the success of a social media campaign. You need to decide what works best for you. Are you looking at lead generation, total number of visits, conversion rate or customer retention? Pre-deciding the top three parameters for measuring performance allows you to get a handle on the direction your social media campaign takes.
Do you need a comprehensive yet simple social media checklist for your next campaign? Click here to get your latest social media check list customized for your brand completely free.