Marketing Math for Staffing Agencies and Recruiters: If you want growth, do the math

Making math part of marketing …. seems crazy, right?

If your agency or firm thinks about marketing as “making things bright and shiny,” or just as facilitators for publishing and distributing content, then you may be missing an opportunity to use marketing math as a foundation for your firm’s growth.

Expand your field of marketing vision and you’ll see that across all types of industries, firms that grow are doing it by basing their marketing plans and budget on data and metrics that just weren’t available a few short years ago. If “big data” (or little data for that matter), conversion rates, proposal metrics, source data, key word analysis, benchmark ranking, click and open rates — and on and on — aren’t a key part of your marketing discussions, then perhaps it’s time to include math in this year’s planning efforts.

I’m going to help you prime your marketing planning pump with this blog post.

Get Your Data Ready

To do the marketing math that’s necessary for making key strategic and tactical choices on how you’ll use your marketing budget, you’ll need the following data. This should not be hard to get, but if it is, you have a marketing infrastructure task to add to your “to do” list.

  • Net/net new business goals: This is a type of BHAG (big hairy audacious goal), where you’ll want to quantify dollars of new business needed or projected. This includes all new/new business and recovery of business lost from existing clients.
  • Average sales $: Determine what a new sales is worth to the firm, first year, and use an average to make the math easier.
  • Proposal win rate: The percentage of proposals you win.
  • New business by source: This represents an estimate of what percentage of total new business money will come through 1:1 marketing (i.e. networking, referrals); digital marketing (email, social media, PPC, organic); and traditional marketing (paid advertising, PR, direct mail). For purposes of the calculations below and based on my experience, I’m using 80%/15%/and 5%, respectively; change these based on your experience.
  • Leads by source: This represents an estimate of what percentage of leads are generated through 1:1 marketing, digital marketing, and traditional marketing. For purposes of the calculations, below, I’m using 70%/20%/and 10%, respectively.
  • Digital marketing only: form submission/conversion rate: This applies if you are gating content on your site for purposes of lead generation. I’m using a 15%/25%/and 35% conversion rates in the example below to show how many eyeballs you need to bring to a form to get the desired conversion rate.

PREMIUM CONTENT: Largest Staffing Firms in the United States: 2017 Update

Marketing Math Calculator for Staffing Agencies and Recruiters

Let’s put this all together and do some math based upon a hypothetical firm that has a new business goal of $600,000. Note that I’m basing some of the match on assumptions about conversion rates, but please be aware that those assumptions are based on experience I’ve had with clients.

As you can see below, 1:1 marketing is going to carry most of the weight for reaching the firm’s new business goal (about 80%), but now, they have a hard target for this tactic: Get 73 proposals and 24 new sales.

The dive gets a little deeper when it comes to digital marketing. About 15% of new business is forecasted to come from digital marketing tactics.

While we have a hard target in terms of proposals and sales, this firm needs to look at the heart of digital marketing: gating content and using forms to capture leads. We can calculate that their digital marketing program needs to account for 68 leads to reach 14 proposals (and five wins), but to get there, they need to bring somewhere between 200 and 500 visitors to their forms on the website.

Two Key Messages for Owners and Managing Partners about Marketing Math

There’s two fundamental lessons here that may change the way that you structure your marketing and business development activities:

  • Math = Accountability

For example, if the math calls for you to bring 73 proposals to the table at an average of $20,000 per sale, then you’ve moved your marketing program from a generic objective that calls for “a 10% increase over last year” to something specific, measurable, and an accountable responsibility.

But the issue of accountability doesn’t stop there.

Managing partners and owners need to be accountable for bringing sales training and individual sales coaching skills to your partners and business developers. If they don’t have the capabilities to close sales, then it’s a prudent use of the budget to bring them the right kinds and levels of training they need. In fact, since 80% of new business is going to come from 1:1 marketing, it only makes sense to put budget dollars into programs that will help partners close more sales, faster.

Or, if the math calls for the marketing program to deliver 400 digitally-sourced leads, then managing partners and owners need to be accountable for getting the marketing department the resources, tools and technologies to let them compete effectively in the digital marketing universe. On the other side of the coin, it means that marketers need to be accountable for securing the skills and training to build and manage a digital marketing program.

Finally, if traditional marketing isn’t delivering new business, then the managing partner or owner needs to pull the plug and direct budget to other more productive strategies, or, consider that expenditures in this category are marked for branding purposes, and don’t carry a requirement for measurable results.

That brings us to the second lesson:

  • Accountability = measurement + change

Transforming Marketing into a Revenue Center

Marketing math is a key building block for turning marketing functions from a cost to a revenue. Armed with knowledge of exactly what you need in terms of sales and leads, and by forecasting the sources of those sales and leads, it’s now possible to build marketing strategies and tactics, and invest in the tools and technologies that will help you drive growth.

If you’re interested in learning more about strengthening the relationship between marketing expenditures and growth, or want to do some brainstorming about aligning marketing and sales to get them on the same page, call me at (585) 750-8258, or click here.

We can help you with your math homework!

MORE: Does Inbound Marketing Make Sense for Your Staffing Agency or Recruiting Firm?

Alan Vitberg

Alan Vitberg
Alan Vitberg is executive director of LeadG2’s professional services team. You can reach him at (585) 750-8258 or via email at alanvitberg (at) csscenter (dot) com. Visit LeadG2’s website for its marketing and sales blog.

Alan Vitberg

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