Marketing Plan Controls: Examples & Explanation

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  • 0:01 Marketing Plan Controls
  • 0:38 Leads & Sales
  • 1:44 Cost Per Sale
  • 2:55 Market Share
  • 3:23 Final Steps
  • 4:04 Lesson Summary
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Lesson Transcript
Instructor: Carol Woods

Carol has taught college Finance, Accounting, Management and Business courses and has a MBA in Finance.

Marketing plan controls compare actual results to your marketing plan to make sure your efforts are generating the anticipated results. In this lesson, we'll discuss some common marketing controls and how to use them to analyze your marketing efforts.

What Are Marketing Plan Controls?

Marketing plan controls compare actual results to your marketing plan to make sure you are on track. Regular review of these controls will help you improve your performance as you adjust your programs to better meet the plan objectives.

Let's take a look at Joe, a marketing manager at a mid-size company. He developed a marketing plan for his division and is responsible for implementing it. He's going to review his results for the year so far to see what changes he might need to make to his programs. We'll follow along as Joe looks at each one of the marketing plan controls to see how things are going.

Leads & Sales

Most marketing plans will estimate the leads that will be generated through a specific ad or promotion and will have a method of tracking those results, like a separate web page or phone number for each promotion. One of the first things Joe will do is consolidate the customer inquiries by promotion and compare them to projections to see if the promotion is attracting the anticipated interest.

Next, Joe will look at product sales compared to the plan. The ultimate goal of marketing is to interest prospects in your product and ultimately for them to purchase it, so the quantity of sales made is crucial. The conversion rate is the percentage of leads that results in a sale and is calculated by dividing the number of sales by the leads generated.

Joe will now look at the conversion rates by source. If a particular promotion is generating lots of leads, but ultimately those prospects don't buy, it may be a poor use of company resources. Conversely, a promotion that only brings in a few leads but has a high conversion rate may be worth expanding.

Cost Per Sale

Until now Joe has focused on the sales resulting from various channels and programs, but he also needs to look at the cost of those programs. The cost per sale is the total cost of a particular channel or program divided by the number of sales made. It can then be compared to the average revenue for each sale to determine if the program is profitable or not.

If a particular program is costing more than the results it's bringing in, it will need to be adjusted or scrapped. For example, let's say a particular program is costing an average of $500 per sale. However, the average customer who purchases through this channel is paying the company $45 a month for an average of 10 months, or $450. It's costing the company more to sell to this customer than it's receiving back in revenues, so this program is actually hurting the company in spite of the new customers coming in. This program should definitely be reworked or terminated.

Joe may also find a specific program that's bringing in a lot of leads inexpensively. That program could be expanded, to increase the funnel of prospects for the sales team.

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