Marketing audit 101: what is it and how to perform one?
Think of this: in 2018 alone, the number of closed enterprises exceeded the number of opened ones by 2.14 times. One of the main reasons for business liquidation is high competition. Business owners constantly say “To get around competitors you need good business packaging, you need to set up the media buying correctly, you need to set up a sales department and then customers will come”. In an effort to make a lot of money here and now, business owners are constantly looking for a “magic pill” that will turn them into the market leaders. For the company to feel confident in the market and take a leading position, you need a strategy and regular audit.
What is a marketing audit and why is it important?
Marketing audit is a tool that develops the marketing of the company, because it not only assesses the current state of affairs, but also shows in what direction it is possible to move forward.
For example, a garment factory sewing business clothes for men is a leader in its region. For 3 years they tried to establish sales throughout USA. They changed 2 marketing agencies, made a new website, optimized the advertising campaign, built a sales department. The result was not achieved. We conducted the marketing audit and it turned out that they had a poor understanding of their target audience, little to no competitors analysis. They have barely had any market research and they have never actually spoken to their clients. As a result, they created ineffective marketing activities. On the basis of the received data, we drew up an action plan for the coming year.
What will the marketing audit provide?
The main objective of the audit is to increase the company’s profit. It also solves a number of tasks such as:
- improving sales scripts
- customer feedback
- trends analysis
- ideas that can improve products, increase customer loyalty
- assessment and optimization of marketing costs, etc.
How often should you do it?
If carried out regularly, once in 3 years is enough. Brand audits are conducted every year. And express audit is recommended to be conducted every 3 months.
Despite the fact that the marketing audit allows to increase the company’s profit without any experiments, only 8% of companies conduct it regularly. If you have already tried different marketing tools and did not get the desired result, then it is necessary to conduct an audit.
Types of marketing audit
If you understand that the work of the marketing department has become ineffective and ineffective, then it is necessary to conduct an audit, including staff assessment and strategy reliability. And in order to make a competent analysis, you need to know how it happens.
External audit is an audit of the marketing environment. It works with both the macro environment and the general objectives of the company. External audit includes analysis:
- market trends – involves determining the stage of the life cycle of the market and its segments, the study of general marketing trends in demand, the forecast of development for the next 3-5 years.
- target audience – the task of this section is segmentation and analysis of target groups of influence, identification and assessment of factors affecting the decision to purchase.
- competitive environment – assessment of barriers to entry and exit from the market, competitive environment, and motivation of competitors. Analysis of the enterprise’s place in the competitive environment.
Internal audit controls all forms of activity of the organization. Internal audit is carried out on the following parameters:
- analysis of the marketing organization – analysis of goals and objectives of the marketing service, functional structure of the marketing of the enterprise, competencies and competence of employees, motivation system.
- marketing mix and media mix – performance evaluation of marketing tools (audit of product, price, distribution, communication and other policies). This also includes digital marketing audit.
- evaluation of the marketing structure today – an analysis of the effectiveness of marketing planning, operational reporting and control system of the goals and objectives, as well as their achievement.
When carrying out control of marketing activities, the organization can use the services of its own audit service or work with independent experts.
Key milestones in the marketing audit
- Defining the direction, scope, algorithms and technologies of marketing audit. At this stage, the company representative and the auditor agree on the objectives, scope, depth, sources of information, report format and timing of the audit. The enterprise provides the auditor with available information on the state of the industry and creates necessary conditions for conducting interviews with employees. The report focuses on conclusions and recommendations for improving marketing activities.
- Collection and analysis of information concerning the evaluated aspects of the enterprise activity. In order to minimize the time and cost of the audit, a detailed plan of the interview (who, when, where, who, on what issues is interviewed) is developed. Research results are analyzed on a daily basis to identify new questions that may be disclosed during the survey. When collecting information, the information received from employees of the surveyed production units, employees of the marketing department of the enterprise, consumers of products, sales representatives is used.
- Registration and presentation of the audit report. In the course of information analysis, the auditor can also meet with the customer of the enterprise. At the suggestion of the customer, the auditor discusses the obtained results and recommendations with the specialists of the enterprise engaged in improvement of its marketing activity.
Construct a Review Of Your Business
1. The details to consist of are:
- Firm location
- Founding date
- Sales history
- Number of workers
- Key workers
- Chronology of company events like mergers, acquisitions etc.
- An estimation of the current brand awareness
2. Define Your Market Goals
- They can be principles like:
- Increase brand awareness
- Boost audience size
- Distinguish from the competitors
- Boost or preserve market share
- Generate sales leads
- Activate existing customers
Detail your objectives and goals:
- Long-term, with 6– 8 goals noted in concern order to be accomplished in the next two years
- Short-term, with 1– 2 goals to be completed in the following 12 months
- Define Your current Customers
- Job titles or features, industry or SIC codes, geographic area, firm dimension and also other demographic, ethnic or behavioral descriptions
- Size of your current consumer target market.
- Describe Consumers You wish to Target
- If your target clients are outside of your normal sector, location or size of current customers
- Any internal or outside variables that have transformed in your business or market triggering you to target a certain team
- A behavior for retargeting to occur
- The size of your target customer audience
- Describe Your Service Or Product
Explain these in regards to their purpose, functions, advantages, rates, sizing as well as distribution approaches. Also include:
- Strong or weak points as compared to the competition
- Any economic, legal, social, technical, seasonal or governmental elements that influence the product/service
- What the current recognition degree is as well as the understanding of your product/service
- Sales or market share background and any kind of changes gradually
- Describe Your Past Company or Advertising And Marketing Activities
- Has been tested and worked to the benefit of your business
- Has never been tested but could help
- Have been used actively by your competitors
- Identify 3 to 6 Competitors
Consist of the company name and area. Describe their products/services in terms of their:
- Distribution channels
- Your competition’s strategy for the near future
- Begin to Outline a Communication Strategy
Start to detail existing as well as future media resources, if costs are repaired yearly expenses as well as what funds are readily available for new initiatives for:
- Advertising and marketing channels such as TV, print, OOH and digital advertising
- Promotional tools and activities like website, direct advertising and marketing, interactive and online marketing
- Media channels
- Events like exhibitions, conferences, seminars and also webinars
- Analytic tools, databases, marketing research as well as tracking systems
Note any advertising medium thought about to be one of the most reliable to date.
As soon as this details is documented theoretically, you can refer back to it as your roadmap to accomplishing your advertising and marketing objectives as well as things for the coming year. And as originalities pop up, this paper can help remind you of the big picture. Minor modifications can be made along the road as adjustments are bound to take place in sales, client retention and also product advancement throughout the year.