6 Questions Every Manager Must Answer Before Committing Marketing Resources

Before you dive into the hundreds of different business frameworks promoted on this website, you need to do a little groundwork. Frameworks are powerful tools, but they are only as effective as the strategy behind them.

Too often, companies jump straight into execution—investing in ads, rebranding, or new sales software—without first answering fundamental questions about their customer base. To ensure your marketing budget isn't wasted, a manager must be able to answer the following six questions.

1. Do I know what share of my customers’ wallets I actually own?

Challenge yourself to answer this: Do you know how much of your customers' total business you are actually receiving?

The starting point of building sales must begin with customers who have already decided to do business with you. However, for various reasons, they may not be putting all their eggs in your basket. The quickest route to revenue is often through these existing customers. If you can persuade them that you can make their life simpler—and possibly cheaper—by consolidating their purchases, you unlock immediate growth.

The reason most companies don't know what share of their customer's wallet they have is simple: they have never asked.

2. Do I know the "stickiness" of my customers?

In other words, how likely are your customers to stay loyal and spend money with you rather than simply disappear?

Loyalty can never be taken for granted. A customer's first obligation must be to themselves. Are they getting the best deal? How much could they save in time, money, and effort by buying from somebody else?

Just because a customer has dealt with a supplier for many years doesn't mean they are loyal. They may be trapped by inertia, believing that as long as you continue supplying in the same way, they will continue to buy. However, a small failure on your part, or a minor benefit offered by a competitor, could change this balance.

Understanding loyalty isn't easy, but it can be tested. Depth questioning of customers can determine whether you are sitting on the tipping edge of a potential loss or if there is a solid, long-term commitment to staying with you.

3. Do I know what really pleases customers and why they choose me?

It is very easy to assume that customers are totally happy with your products and services. It's a bit like somebody asking you how your journey to work was. If everything went smoothly, you would say it was fine.

And everything may be fine—until it is not.

What would happen if, for whatever reason, one of your products failed, wasn't delivered on time, or didn't measure up in terms of performance? Certainly, customers can be pleased by service that meets expectations. But to what extent do you surpass expectations, and what is it that would ensure you do so?

4. Do I know how to win new customers and where to find them?

The hardest job of all in business is finding new customers who are prepared to buy your products and services at a realistic price.

Finding new customers used to be the task of salespeople. Nowadays, very few people carry that moniker. New customers are won through building awareness and interest, and a strong brand search that leads people to seek out your company. After that, it is your job to convert them and convince them that they have found the best supplier and need never look elsewhere.

5. Do I know what my current customers need that they are not receiving?

Winning a customer in the first place is a hard task. Once they are on board and have learned to trust you as a supplier, there is a strong possibility that they would look favorably upon you for supplying other goods and services—assuming, of course, that these goods and services have some association with what are perceived to be your skills and capabilities.

How much do you know about your customers' needs beyond what you currently supply? Consider depth interviews with customers or carrying out an ethnographic study to find out.

6. Do I know what tolerance my customers have for higher prices?

There are only three ways to make money in business: reduce costs, sell more product, or charge higher prices.

There is a tendency to believe that the price your customers are paying is the maximum they will tolerate. It would be highly unusual for a customer to tell you that your products are too cheap. However, there are tools in market research (such as Van Westendorp or Gabor Granger) that can help you work out if you are leaving money on the table.

 The Framework Connection

Once you have answered these six questions, you will have a clear picture of your current position. Only then can you effectively apply the various business frameworks available to solve specific problems and drive growth.