Marketing Article: Sales vs. Marketing
Sales and marketing are often used interchangeably, but in fact, there are significant operational differences between the two. Sales is the process of selling a service whereas marketing is used to maintain interest in your brand. Both new and existing businesses need sales and marketing to expand and drive revenue. However, the resources put into each business arena depends on a variety of factors. Sales and marketing managers consider how large their customer base is, what their previous revenues were, and what they’re hoping to achieve in the future.
The rise of digital marketing has impacted how businesses sell and market their products or services. While they don’t have to rely on traditional marketing methods like TV and print ads, using these methods along with PPC, SEO, and content marketing ensures that you achieve optimal results in both revenue and brand awareness.
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A Brief Introduction to Sales
Sales is the direct process where one party - usually a salesperson - talks to a prospect with the goal of selling them a product or service. Traditionally, this is done over the phone or in person, but today there are more digital options available to business owners. Examples include email campaigns, streaming media, and online ads. Salespeople use these different avenues for managing relationships and providing solutions for prospects that will eventually lead to a sale.
From an operations standpoint, sales mostly focuses on the short-term. Sales managers are responsible for tasks like creating action plans and defining team structures. Once the basics have been established and sales territories have been divided amongst team members, managers typically move on to the strategic part of the sales process; this includes deciding if they should take a conceptual selling approach or focus on the business’ Unique Value Proposition (UVP).
The final goal of any sales management team is to fulfill targets and ensure ongoing revenue generation. They reach these goals by taking different approaches to connect with prospects, one example of which is calling leads. Even though this is a relatively conventional method of selling, many businesses still take this route because it remains effective.
In sales, managers use three types of leads to distinguish their prospects:
Cold: cold leads are unfamiliar with your business and have rejected your calls, emails, and other outreach initiatives. In this case, you are facing significant obstacles in turning cold leads into paying customers. While this might change overtime, cold leads are difficult to convert.
Warm: warm leads are somewhat aware of your brand and have previously expressed interest in it. They could have done this by signing up for an email newsletter or connected with you via your website’s contact form.
Hot: hot leads have already been nurtured and are ready to make a purchase for a specific service. To determine the quality of the lead, sales managers use the BANT method, an acronym for Budget, Authority, Needs, Timeline.
Budget: does the prospect have enough money to purchase your product or service, and are they sharing their budget with other departments?
Authority: is there anyone else whose approval is needed prior to making the purchase? Essentially, you want to find out if your lead is the decision maker.
Needs: which problems does your product or service solve?
Timeline: when is the lead looking to close the deal?
A Brief Introduction to Marketing
Marketing is any business action taken to increase awareness of a brand or product. It’s a holistic process that targets a wide consumer base as opposed to focusing on one-on-one interactions. The traditional model of marketing is an activity that creates ads and buys media space, but now, inbound marketing is the preferred method for creating awareness. Inbound marketing is online–you inform website visitors about your products and services and explain how they help solve consumer pain points.
Marketing teams work to educate consumers on the benefits of using their products; they move prospects quickly through a buying process without overlapping with the sales department. To provide the best possible experience for consumers, marketers spend a lot of time researching marketing opportunities as well as refining current marketing actions. Overall, the main goal of market research is to figure out what consumers want, how to deliver it to them, and analyze campaign data for future improvements.
Companies use different types of marketing depending on the brand’s goals and target audience.
1. Influencer Marketing
Influencer marketing is a fairly new method that stems from the rise of social media. It leverages individuals with large social media followings who can deliver a brand’s message to a wider audience.
2. Viral Marketing
Similar to influencer marketing, viral marketing is meant to target a large audience in the most cost-effective way possible by encouraging people to pass on a message, either through social media or other internet communiques or by word-of-mouth.
3. Relationship Marketing
Relationship marketing focuses on strategies and tactics for building loyalty within specific customer segments. Marketers study consumer behavior and data analytics to create initiatives for the right audience.
4. Keyword marketing
Keyword marketing involves researching and using frequently searched keywords and phrases in online ads. This marketing technique increases the chances of connecting with your target market.
5. Outbound Marketing
Outbound marketing is when a brand delivers its message through channels like TV, radio, and digital display advertising. Marketers typically see positive results because they increase consumer awareness for a specific product or service.
6. Inbound Marketing
Inbound marketing is when customers contact the brand in response to different marketing methods, including email campaigns or content marketing. The point of inbound marketing is to establish trust and loyalty with customers by providing them with solutions to their pain points.
7. Search Engine Optimization (SEO)
SEO is the process of developing a marketing strategy to boost a brand’s online visibility. Search engines like Google index websites based on keywords, content, links, etc. to determine whether they should rank at the top of the search results.
8. Content Marketing
Content marketing is the creation of valuable and relevant content that attracts a specific audience. The end goal of content marketing is to encourage customers to take action and purchase a brand’s products or services through storytelling. The quality of content is also an SEO ranking factor.
In addition to the different types of marketing, there are 4 Ps: product, price, place, and promotion. Each of these help businesses identify what their consumers want from them, if they can deliver, and how to stand out from their competitors.
How Sales and Marketing Have Changed Overtime
Sales is essential for growing your business, and taking advantage of modern sales techniques is a guaranteed way to stand out in your market. The term “Sales” used to be associated with persuading someone to purchase a product regardless of whether it fitted their needs. Today, selling is seen as helping, where a brand gets to the bottom of how they can provide solutions to consumer pain points. This is sometimes referred to as “authentic selling” because you are targeting those who would benefit most from your product or service as opposed to aiming for a wide audience who might not need them.
Remember that your prospects are well educated about products or services they’re looking for, which is why sales managers don’t solely rely on cold calling and door-to-door sales. They have expanded their reach into social media, websites, and review sites that customers use for product research, and invested more resources into inbound marketing, such as SEO, rather than outbound marketing, like phone sales. Training marketing teams on best practices for online sales is one way companies keep up with consumer expectations. Your sales team should be fully prepared to answer any questions about your products as well as be aware of your main competitors.
Consumers don’t just expect good service at the time of purchase; they value on-going support and prompt responses to their online inquiries. Given the increase in consumer expectations, sales managers now have to train and rotate their team to be readily available at different times. It’s also important to have a time frame in which you respond to queries; for instance, each question or concern must be answered within 8 hours. Implementing a plan to respond at regular intervals allows your team to stay organized while maintaining - and even exceeding - customer expectations.
Email and phone are not the only methods customers use to communicate with brands; live chat is becoming a much preferred option because customers can receive instant responses. Offering a live chat feature on your website proves that you value your customers’ time and needs. Your sales team can use the chat to answer questions about new products, provide technical assistance, or resolve complaints. It eliminates the need for consumers to wait on-hold or risk having your business’s email sent to their spam folder. The chat function allows them to multi-task and get the solutions they’re looking for simultaneously.
Recently, Customer Relationship Management (CRM) systems have become increasingly critical to sales. The majority of businesses use them to stay organized, manage their customer base, and sell products or services.
Marketing trends change quickly and a marketer must adapt quickly. This helps companies remain consistent with their purpose and image. Adaptability and consistency rely on consumer needs. Creating new products and services is only one piece of the puzzle; marketing them is another.
A few decades ago, marketing was synonymous with direct sales. It then shifted to telephone marketing, where salespeople would make dozens of calls per day hoping their prospect would show interest in purchasing their product.
Today, there is a distinct difference between sales and marketing and their impact on business operations. Digital marketing dominates radio and print ads as the preferred marketing option because consumers now rely on their smartphones to search for information. The evolution of technology has required marketers to develop different skills to help brands excel in their market. They consider all aspects of the marketing process from the business side to analytics, so they can create successful campaigns that target the right demographics.
Prior to the digital age, businesses would film engaging commercials or place large ads in the Yellow Pages. While these methods resonated with consumers at the time, people now want to see shorter, more effective ads that include compelling visuals and graphics. For your business to survive in today’s market, you need to take a holistic approach to marketing by incorporating three areas: creating your brand; developing a strong campaign; and delivering a positive customer experience.
Building and Positioning Your Brand
Strategic planning of your brand is helpful in many ways; it helps you narrow down your ideal audience and clearly communicate your message to them. Your end goal is to differentiate yourself from your competition in a clear and concise manner.
Even though many marketing functions are automated, the digital landscape presents certain challenges to businesses. Consumers review products and watch demonstration videos to help them decide if they even want to make a purchase. Keep in mind that they can do this anytime and anywhere with their smartphones. To help steer your customers in the right direction, you need to be authentic when discussing the benefits of your product. Be honest with your audience and avoid pretending to be a type of brand that you’re not just because it might draw in more customers.
Once your brand has been positioned, it’s time to focus on consistently bringing value to your customers. Consistency ensures your brand is easily recognizable within your target market and encourages customer loyalty.
Developing Marketing Campaigns
Over the past decade, the increase in business websites and ecommerce has shifted marketing towards digital marketing. Almost 90% of people search online prior to making a purchase, making the need for a professional website more important than ever.
A website, however, is only one part of the marketing process required for your business’s success. It should be used along with social media marketing, email marketing, and media advertising.
Delivering a Positive Customer Experience
A proactive approach to customer service is one way to help you stand out from your competition. Customers rely on their research from your social media accounts, websites, and search engine reviews to decide whether they want to make a purchase. Without prioritizing user and customer experience, your website will likely rank low on search engine results and fail to maintain enough visibility to attract customers.
One way to better understand your customers needs is to map out their journey, from initial contact to delivery. This enables you to “see” what your customers see, improve their journey, and buoy their experience. Providing your customers with a great experience results in positive reviews, high referrals rates, and consistent business growth.
Marketing today is a complex process necessary to deliver your message to consumers. Staying visible and relevant is the key to impactful marketing. This could require, for example, learning to specialize in social media marketing. As social media use increases, knowing the right ways to connect with consumers through social media is essential and will lead to optimal marketing results.
Working with professionals to improve your brand by targeting the right customers and crafting compelling content via different marketing channels will not only set your business apart from the competition, but also ensure long term success.
How Much Should I Spend on Sales?
The cost of sales is a bit of a gray area–it depends on a number of factors including how new the business is, which industry you’re in, and goals for the upcoming year. A high revenue technology company can spend as much as 25 - 40% of revenues on sales, whereas a small business might spend roughly 10%. These figures’ common denominator is that they represent the significance of sales cost as a percentage of revenue.
How Much Should I Spend on Marketing?
Firstly, marketing is absolutely essential to your business so prioritizing an appropriate budget is important for growth. While there are many marketing tutorials available online, the DIY approach doesn’t necessarily guarantee success; in fact, it might turn your marketing campaign into a money-pit.
Marketers go by the 5% rule. Google Ads, social media, and PR are just a few examples of the costs in your marketing budget. Make a list of all your marketing activities and spend 2-5% of your sales revenue on them. Although the 5% rule is quite general, many businesses find that it is enough to keep their marketing efforts going at first. As your business revenue grows, you will likely have to increase your budget for the following:
Your website is the foundation of your business because it includes all the information consumers need as they start on their purchasing journey. When thinking about your website, take the cost of hosting and analytics into account when setting your marketing budget.
2. Online Advertising
There is no limit on how much to spend on SEO, but your budget should be based on the results they achieve. Working with a marketing professional can help you monitor your online advertising and budget accordingly.
3. Social Media
Social media marketing is one of the most powerful tools available to businesses. Facebook, Instagram, and LinkedIn are platforms business owners use to increase their online presence and connect with their target market. Social media ads generally work on a per click basis, so it’s important to consider who your audience is and the platforms they use before setting a budget for social media ads.
Since customers typically sign up for email newsletters, use email newsletters to encourage loyalty and repeat business. Budgeting for e-newsletter production involves planning and writing the emails, as well as paying the monthly fee for the online tools used to send out the emails.
5. Traditional Advertising
TV and print advertising are still valuable options for businesses and should be used in addition to digital marketing efforts. Prices vary depending on the number of viewers the outlet has and where your ad is placed.
The impact of social media has resulted in more people consuming visual marketing content. To keep up with this demand, you should allocate a portion of your budget towards filming and editing marketing videos to share on social media or on your website.
To fully maximize your marketing budget, start by setting SMART goals. They should be Specific, Measurable, Achievable, Realistic, and Timely.
Consider user personas and your recent market research to create attainable goals. For example, you might want to increase website traffic or develop a new division. No matter what your goal, how much you spend on marketing should also be linked to your website and communication pieces. If you don’t have the basics to reach your goals, marketing will be far more costly and might potentially be in-effective, resulting in wasted resources. To avoid such a situation, ask yourself if your branding is consistent; if you have a strong business development plan; and whether there are any barriers preventing potential customers from becoming paying ones.
Keep in mind that prior to spending, you need to be aware of weaknesses in your brand - and fix them as quickly as possible. Sometimes, this might require additional funds but it’s crucial to address brand issues before allocating marketing costs.
Can My Business Survive Without Sales or Marketing?
The short answer is no. While sales and marketing are two different areas, they work together to help a business grow. All businesses need to find customers who are interested in their products, and sales managers are responsible for generating leads and referrals. Monitoring the conversion rate from prospects to customers is one of the key responsibilities of a sales department, especially for those running online businesses. These metrics are extremely important when it comes to strategizing and planning for the future.
While sales is critical to the growth of any business, the size of your sales department will vary depending on if you just started a business or if you have taken over an existing one. If your business is new, then you will likely need to invest more in sales since your brand is unknown in the market; an existing business already has a customer base.
Marketing starts before creating a product because you need to understand who your consumers are, what they’re looking to achieve, and if the product or service can solve their problem.
Market research is only the preliminary step to creating a successful business; once a product has been created, you need to use both online and offline methods to connect with target markets. When it comes to effective marketing, content is the most important aspect. It allows you to communicate with customers by asking them to subscribe to e-newsletters and follow blogs. By keeping them up to date, you build a strong relationship with them and earn their loyalty.
It’s not over yet, though. As a business, you must ensure that your customers keep your products or services at top of mind. To do this, you must use a mix of traditional and digital marketing.
Traditional marketing is when you advertise via TV, radio, newspaper ads, etc. It is still an effective way to reach millions of people regardless of whether they fall into your target market. Digital marketing, on the other hand, is more customizable. It gives you the opportunity to connect with the right demographic through both SEO and PPC. For example, if you own a children’s clothing store, you could utilize keywords related to children and parenthood to get your brand in front of parents.
Sales and marketing are two very different areas that differ in terms of approach, with sales being a more short-term tactic and marketing focusing on long-term goals. Despite the distinctions in the two operations, both are critical for businesses in all industries - and of all sizes - to grow and succeed.
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