In this issue, we talk about business development and branding. I look forward to your comments. 

 
 
 Rick Erling - VP Business Development
(972) 727-6880

For many years, business-to-business firms have mispositioned their corporate business development by disproportionately spending their firm's funding resources on brand awareness instead of revenue generation. Below is a recent study supporting the continued quest for brand awareness.

Provided to Paul DiModica by eMarketer.com under contract.

Interestingly, there is a 18% difference between brand awareness and actually generating revenue.

The Internet is just a distribution channel. Yes, an extraordinary evolutionary step for business development, but still just a channel. Just like a direct sales force, a strategic reseller, an authorized distributor, or a private label (OEM) partnership, it has a strategic and tactical value as well as an operating expense model that can be prohibitive.

So, what is a brand? Depending on the author of the month, branding is a strategic positioning in a targeted buyer's state of mind that creates awareness to select one vendor over another.

Sounds great, but branding does not create revenue. We've all seen the television commercials of flamboyant ads that cost millions of dollars display funky off-the-wall concepts trying to create market mind share with a target audience. Additionally, we have been exposed to irrelevant ads that don't show the product or service but display some artsy message.

Well it's time to change. As business executives, we need to recapture our operating business models back from ad agencies, marketing departments and business brand managers and start operating in the new economy based on old economy proven business development revenue methodologies.

Prior to the aggressive expansion of the Internet in 1997, branding, marketing, PR, and ad agencies were staff positions and advisors in a corporate traditional hierarchy. Over the last decade, these departments launched themselves into line position responsibilities. Instead of advising management on communication strategies, they implemented programs. So, ad agencies that may have sold cereal and print placement in years ago evolved into interactive media experts. Although this comment may not be well received by my agency friends, it is, in fact, accurate.

Who pitches all of those dumb ads you see on TV to an executive steering committee? An ad agency. Who built entire companies operating business plans around a company name with no supporting revenue model? A brand manager.

Does having positive client brand awareness help sales? Yes, of course. But is brand building the most efficient form of spending to create leads for a start-up? No. If you listen to staff departments who have never collected a million dollar purchase order in a competitive marketplace as your primary influencer to build revenue, then you will get limited revenue.

Accepting this fact, you are now on your way to increasing your success.

Here are some additional studies reflecting current trends:

Provided to Paul DiModica by eMarketer.com under contract.

Interestingly, the pie chart provides the goals from the top office in the UK -- the CEO -- rather than a marketing executive. In this chart, brand awareness is a low priority, but surprisingly, customer satisfaction is at the bottom.

The bar chart below shows that "branding awareness" falls slightly below "lead origination". However, it is interesting that even further below "lead origination", marketing budgets do not allocate very much for actually nurturing the lead that cost so much to obtain.

Provided to Paul DiModica by eMarketer.com under contract.

Growing a company in this economy is based on implementing a business development approach to revenue. Prior to 1998, the term "Business Development Manager", Director of Business Development", or "Vice President of Business Development" was synonymous with the word salesman or account manager. But as term "business development" has evolved, the element of technology and partner collaboration also developed.

Today, the term business development has matriculated into a hybrid business approach where sales, marketing and strategy are interactively liked together to generate revenue.

Combine old world sales methodologies and new world collaborative relationships to focus on tactical revenue growth. The successful companies of our time were all built on a persistent sales force, not branding.

10 Steps to Grow Corporate Revenue
for Your Firm

1. Reduce your PR. Most firms spend a disproportionate amount on PR -- or even worse, a PR firm that is cost thousands of dollars but doesn't generate one lead. Being profitable will create a greater spin than any PR budget.
    
2. Get the very best VP of Business Development you can find and afford.
    
3. Never let an ad agency or a marketing department convince you of running a conceptual marketing program. They rarely work and are usually more expensive than traditional communication campaigns.
    
4. Hire business development managers and salespeople. In this economy, you need seasoned talent who can strategize and partner their way to revenue. People generate revenue, not a company name.
    
5. Increase your telemarketing budget. It works; it is effective; and it helps reduce sales cycles by half.
    
6. Never let an ad agency sell you positioning marketing expenditures. If you treat your customers well, you are building a market position and a brand.
    
7. For every market you identify, pick at least three strategic partners to help build your collaborative sales.
    
8. Never add more partners than you can handle. Most firms love adding partners, but most regional business development managers can only handle a certain number of relationships efficiently. Remember, strategic partnerships are not about press releases - they are about revenue.
    
9. Don't develop your marketing collateral materials in-house. Your communication materials need to be direct, informative and well executed. In-house productions always look unprofessional.
    
10. When revenue in a territory is flat, cut the business development manager's territory in half. By reducing territory size, you force business development managers to find the hidden sales opportunities that get lost in a target-rich territory.

Following this outline will help you focus on true revenue producing opportunities and reduce misguided or misdirected new economy traps of brand management.

Create your brand through strategic business development and increased customers.

I welcome your comments.

 To your success,

Rick Erling - VP Business Development