Section 1.

1.1. Business and marketing objectives

An introduction to objectives

Before we can come up with a marketing strategy, or a plan, we need to establish what our objectives are.

The objectives are where we want to get to.

The plan is the specific steps we need to take to get there.

The strategy is how we are going to get there cheaper or faster than our competitors.

We’ll unpack these concepts throughout the next three sections.

Only when we are clear about what our objectives are, can we measure what progress we have made to achieve those objectives, to understand how successful we have been.

I like to think of this in a geographical terms.

If we don’t know where we are trying to get to, then it doesn’t matter if we can measure how far we have travelled, how quickly we have got there, or how much it has cost us…

Let’s imagine we are in a sailing yacht and have just left Southampton, one of England’s busiest ports. We can have all sorts of gizmos and gadgets on the ship. After 5 hours sailing we have travelled 50 miles South East from Southampton, the depth of the water is 150m, we’ve used 40 gallons of fuel. The missing information is of course, where we are trying to sail to.

If we’re trying to sail to Cherbourg in Northern France, then we’re making good progress. It’s 88 miles due South from Southampton.

If however, we’re trying to reach Plymouth which is 156 miles due West of Southampton, then we’re not making good progress. In fact, we’re going in the wrong direction and we’ve wasted a lot of fuel.

So it’s fundamental to know where you are going to give the context to what you are measuring, to be able to prioritise the information that you are receiving.

Sailing is a good analogy, as many of you will know that things are rarely ‘plain sailing’. In fact to travel in one direction, often requires you to go in a totally different direction first. Because sailing yachts rely upon the wind, they cannot sail directly into the direction that the wind is coming from. They have to sail at 45’ to the wind first in one direction, then turning 90’ and sailing in the other direction. In this way they move forward. It is called ‘tacking’.

There are other reasons why the yacht might not be able to sail directly towards its destination. Directly south of Southampton is the Isle of Wight, and the waterway known as the Solent. So the yacht must sail around the Island of course. The Solent is also very tidal, which means at low tides there is the danger that the boat could run aground. Yachts coming out of Southampton must know the tide times and avoid the shallow waters, as well as the massive container ships!

Having a clear objective, means that no matter what obstacles or diversions arise, we can always steer ourselves back onto course.

Business & Marketing Objectives

I’m going to make a distinction between the overarching business objectives and the marketing objectives (which we’ll come back to in a minute).

Most businesses will have set out what their main objectives are this year, these are often set by the senior management team, and are then communicated around the entire business. Objectives may change from one year to another, or with a new CEO, or with a new overarching vision of business strategy. But every organisation should have them as it sets the direction.

Business Objectives

Business objectives are usually focused around driving revenue and growth. Although there is no set rule about how many objectives you should have, it’s better to have fewer objectives. In my experience, there is space to include other sub-objectives that contribute to and help to deliver on the main business objectives - but we’ll come back to this discussion when we discuss One Key Results in Section XX.

Some examples of business objectives might be:

Increase revenue by 20%

Increase Brand Awareness by 10%

Increase Market Share by 15%

Decrease Customer Acquisition Cost (CAC) by 30%

Increase Customer Lifetime Value (CLTV) by 50%

Reduce Customer Churn by 20%

Increase Profitability by 15%

Increase average monthly Net Promoter Score above 9

The business objectives typically focus on increasing revenue, getting more customers (more leads, more sales conversion), keeping more customers and increasing profitability. The business will select its objective to focus the resources of the organisation on the area that needs the most attention, or that offer the greatest opportunity to impact on future growth.

Case Study: At Zipcar, we knew that our members were our most valuable asset, but they were starting to churn and not renew their memberships. There were a number of reasons behind this, but it was affected by all parts of the business from sales, to member services, to fleet operations, to marketing and technology. We had started to use Net Promoter Score as a metric in our customer satisfaction surveys, and see that the average monthly NPS score has fallen month on month across the previous 12 months. There was a clear positive correlation between NPS and churn rates: As NPS dropped, the churn rate increased. The company made NPS one of the main objectives for the year, and we reported progress in the monthly all-hands meeting.

After 6 months and thanks to a team effort, we had managed to arrest the drop in NPS and it started to increase. Now we had to keep it increasing. It got everyone focused on what they could do that would impact on NPS. We eventually managed to get average monthly NPS up to 8.6, a very positive score, but most importantly it also meant that our churn rate dropped and we managed to keep more of our members, for longer. Ultimately, our customers were happier and more content - and we had the data to measure it.

Case Study: IDM Online (Online Professional Training). IDM Online was a new business and a new team. After a few months we had experimented with a number of different marketing channels and found some (email marketing via job boards) were very effective at generating leads. When combined with all the other marketing activity, we had a steady flow of leads, but sales conversion was low (<5%). We made Sales Conversion one of our business objectives. Marketing focused on increasing the quality of the leads that they generated, by further identifying ‘Qualified Leads’ with higher conversion and then focusing spend more on these channels. In the sales team we hired more staff, but also increased the training. We also put in place a number of online events specifically to help convert leads. The result was everyone was working towards increasing sales conversion which we managed to get up to 20%.

Every organisation should have a clear set of business objectives, and the simpler and fewer, the better. Marketing makes a significant contribution to those objectives and therefore, marketing should have its own objective that align and feed into the business objectives.

Marketing Objectives

Sometimes this is very simple to grasp, for example if the overarching business objective is to generate more revenue, then marketing might have the objective of generating more quality leads.

However, sometimes the business objective might be more abstract, let’s take the objective to ‘increase profitability by 20%’. In this case we need to spend a bit of time breaking down the business objective into marketing objectives. Ideally, each of these marketing objectives needs to contribute towards the overarching business objective. Marketing objective that might contribute to overall profitability might include:

Increasing the number of qualified leads by 15%

Increasing sales conversion by 50%

Increasing customer retention/ Reduce churn by 20%

Increasing average revenue per user (ARPU) above $100 - also known as upselling.

Showing business objectives at the top

Marketing objectives below and other departments (e.g. sales, customer service, product) also contributing.

Your first job is to map these business objectives into marketing objectives. Every organisation will be different, so it’s something you’ll have to figure out for yourself. You should end up with a set of marketing objectives that you can then apply in your marketing strategy.

When coming up with objectives it’s useful to make sure that they are SMART objectives, developed by a management consultant called George T Doran in 1981, but they’re now widely used. Smart stands for:

Specific - Be clear, unambiguous and single minded about what you are aiming to achieve.

Measurable - Make sure that you can measure what you are trying to do, in order to evaluate if you are achieving it, or not!

Achievable - Are your aims something that can actually be achieved within the time available?

Relevant - Is what you trying to achieve going to help the bigger, business objectives of your organisation?

Time bound - Ensure that the time period for achieving these objectives is very clear.

Here is a checklist for creating your marketing objectives:

Be clear what the business objectives are.

Think about what marketing activity can contribute to achieving these business objectives and create a ‘long list’ of objectives.

Evaluate whether the objectives on this long list are SMART. Get rid of any that are not.

Rank the objectives that you have left.

Try and get the total number of objectives down to a shortlist of 2 or 3 (4 max).

You should refine this shortlist further as you create the first few drafts of your marketing plan in Section 3.