Get Yoda's Wisdom

Once an entrepreneurial enterprise gets beyond the early start-up phase, growing sales becomes the total focus of the company.  But, most often, entrepreneurs fail to understand the absolute connection between sales and marketing; that in order to, effectively, ramp sales, that they have to, effectively, ramp marketing! And the converse is equally true if you cut marketing, it will seriously impact sales!

Sales and marketing are functions "joined at the hip."  One cannot exist without the other.  Marketing creates the market awareness and early interest that become the qualified sales leads for sales to close. And that is the net of the two functions, nothing more, nothing less.  Marketing generates the leads that sales closes.  If marketing is doing their job, then the job of sales becomes way more efficient, usually resulting in higher average "ticket value" per sale and a higher average sales volume per salesperson.  If marketing is not, then sales has to do more lead generation (not usually their strong suit) and is less efficient.  Nothing earth-shattering here.  Pretty simple, straightforward stuff.

Yet many entrepreneurs don't get the connection. They're often so wrapped up in the product, that they feel is so good, that it literally sells itself. So not much marketing is necessary, just enough to make people aware of the product.  And then the sales effort is simply taking the order. And, of course, neither could be further from the truth.

Usually, this means there's never enough spent on good marketing or worse, it is spent erratically.  Additionally, the members of the sales force are, often, viewed as folks who make "big bucks" for, what appears to be, a simple job. And while small companies can survive this mindset, it does set the stage for what, often, happens when growth stalls, impacting cash flow.

Think about small companies you're familiar with, or your own company. When cash flow is impacted and cuts are necessary, what's the area where first cuts occur?  Frequently, it's marketing, viewed in many small businesses as a "nice to have" rather "mission critical."  And the impact of those cuts?  Less efficient sales, often resulting in lower sales.  Kind of counterintuitive when ramping sales is the objective, wouldn't you say? Yet it's done every day.  I've had a number of clients (sometimes despite my advice, for which they were paying) do this very thing and then live to regret it. And, if a small company is not careful, it can cause a "death spiral' for the enterprise.  A less efficient sales force, maybe even lesser sales and then more cuts to marketing, then even less efficient sales, etc.

The lesson here is to know and understanding the tight linkage between sales and marketing.  Each needs the other to fulfill its role in the long-term growth and success of an entrepreneurial enterprise.  There can be no real long-term success without both working, cohesively, in a small business.

"The Entrepreneur's Yoda" knows these things.  He's been there.  May success be with you!