The Art of War III: Sustainable Campaigns
In the 2nd chapter of the Art of War, Sun Tzu explains the cost of war from a logical, brass-tacks point of view. His overall point is that individual battle strategies do not win a war. A war is about sustainability, being able to endure and prevail both emotionally and financially. In the same vein, while a single campaign (e.g. “Increase my Facebook fan base) can be compared to a battle, the war is your company’s overall brand & marketing strategy.
In this article I will explain Sun Tzu’s principles and show how they can be used to:
- Create sustainable marketing efforts
- Build and increase a marketing budget
Throwing Money At It vs Organic Growth
Many companies, in particular small to medium sized companies with very rigid budgets, are prone to fall into a paradigm of viewing marketing as just a necessary evil in the world of business. It’s like a priest’s confessional booth, they hate going to it but every once in a while they have to show up to avoid the business going to hell. “Yeah yeah I know we need an ad in the trade journal, here’s my $850 offering, now let me get back to running my business”
This approach to marketing and advertising is a great way to waste time, money, and effort – all of which compile over time to lower a company’s morale. In addition, it misses the entire point of advertising: to increase a company’s profits. If a campaign, no matter how small, does not one fit the following criterion, it should not be executed:
- Bring in more profit through sales than the overall cost of the entire campaign.
- Change a company’s lack-luster reputation for the better
- Increase brand awareness over time to such a level that the cost is justified by future sales
- Effectively position a company for the success of a future event (e.g. product launch)
Sun Tzu illustrates this very clearly:
“Hence a wise general makes a point of foraging on the enemy.”
Keeping in mind that we already established (Art of War I) that the ‘enemy’ is not necessarily your competition! The enemy is “Anything that stands in the way of you effectively communicating your company’s message.” Sun Tzu talks about the cost of waging a battle, in particular a prolonged battle. Food, provisions, repairs, and the team’s overall morale. Therefore, by foraging the enemy upon victory, the army can replenish their supplies and boost their morale. In the same way, the marketing campaign’s spoils should exceed the cost. This is called ‘Organic Growth’.
“People often say that motivation doesn’t last. Well, neither does bathing – that’s why we recommend it daily.”
Employees and owners alike are vested in the success of a campaign, even if they are not directly involved. Think of it like your favorite sports team (most likely the Timbers I am sure) – the fans are disappointed at a loss and energized by a win, even though they weren’t on the field scoring points. For the players, this is amplified even more. Not only do they have a personal stake in the matter, but they feel the pressure from the team as well.
Sun Tzu’s answer to this is to reward the players by their success. Rewards can come in many forms, but it’s important to build this into the campaign from the beginning. How you choose to manage your team is another topic, but having a plan in place to reward good work is vital. This even goes to single-owner, 1 person shops! If you promise yourself a reward (iPad 3 anyone?) upon the completion of a successful campaign, and build that reward into the budget, you may be surprised how motivated you will become.
“A budget is telling your money where to go instead of wondering where it went.” -Dave Ramsey
The approach to creating and/or increasing a marketing budget lies in the same principles as Sun Tzu’s foraging rule, which parallels basic principles and building wealth. It takes discipline and consistency, but positive results can happen surprisingly quickly – and the sooner you get to it the sooner it you’ll find success. The process can be made very clear in a few simple steps:
1. Create a Campaign that will create more a profit
Please note I said ‘profit’. If an ad campaign costs $100, and at the end of it you sell a Microwave for $150, that sounds good, but what is the cost of the microwave itself? If it’s over $50 then you’ve lost money. The goods or services you sell have costs, and those costs must be calculated. Therefore, do not consider a campaign successful simply because it grossed more than it cost, consider it successful when there is a profit.
2. Reinvest the profit into the next campaign
If your goal is to create a sustainable marketing budget from scratch, or to increase your marketing budget, then you must have the discipline to buckle down and not spend the profit the campaign made in other areas. The profit constitutes the money left over after all the costs were paid. By applying this back into the next campaign, you can now increase the next campaigns profit by that much more. As a general rule when you have a successful campaign strategy, the more you invest the higher the yield. Soon enough, the profit itself will be able to fund the entire campaign. For smaller companies, this can mean the difference between scraping by and finally landing a $3000/mo marketing budget that pays entirely for itself. Imagine having a 100% commission sales person who does their job well and perfectly represents your company?
3. Review & Improve
Do not take success for granted! People can be fickle, trends change at a whim, new technology gets introduced, things change. A company that is successful at marketing continually refines, modifies, and optimizes their advertising for the best possible outcome. They adapt to changes, they consider new paths, and the respond. By setting profits from existing campaigns into a separate R&D pool, you can fund a team to simply do research and development for new campaigns, without the threat of them being profitable, which frees the team to be creative, and think out of the box.
These are simple principles that require real discipline, but the rewards can be amazing. By putting the up front, proactive effort into creating effective and sustainable marketing efforts, a company will soon find the freedom to focus on solely what they love to do, rather than spinning their wheels and remaining in a constant state of reaction.
What marketing success have you found? Please share stories below, we can all learn!