Marketing and Sales: The Missing Pieces
AV systems that are technically elegant, adroitly installed, and masterfully commissioned often evoke a single word of appreciation and awe: sweet. Less magical, though no less essential, are the business underpinnings of sales and marketing.
AV SYSTEMS THAT ARE TECHNICALLY elegant, adroitly installed, and masterfully commissioned often evoke a single word of appreciation and awe: sweet. There's little doubt cool technology drives and inspires the commercial AV systems integration industry. Less magical, though no less essential, are the business underpinnings of sales and marketing. Without sales and marketing, integrators would have a hard time monetizing their and their clients' visions.
Just as technology advances, so too does the business acumen among successful AV integration firms. Yet in many cases, business capabilities trail technical. And if not planned for correctly, sales and marketing can be among the missing pieces of an otherwise successful business.
Few firms would deny that sales and marketing are important to growing their companies. But the gap between what they know and what they do can be telling. So far this year, the NSCA has conducted two Market Intelligence Briefing studies to gauge sales and marketing best practices in the commercial AV industry. In January, it released “Marketing and Promotion in the Commercial Electronic Systems Industry; in April, “Sales Management Trends in the Commercial Electronic Systems Industry.” Both are available in their entirety through the NSCA Web site (www.nsca.org), and both are useful reminders to systems integration firms to benchmark their own companies in these two vital business functions.
We've boiled down some of the findings into five key pieces that AV integrators will want to plan for, hone, or augment as they grow and improve their companies. The fact is AV systems integration is still a growing, increasingly competitive marketplace. To move ahead without these pieces puts you at a disadvantage. While the majority of what's discussed here applies to integrators, the NSCA research also includes results for independent technical/design consultants. Download the original reports for more information.PIECE #1: The Marketing Plan
Systems design and installation doesn't happen on-the-fly or by improvisation, yet often that's the approach integration firms take to marketing and promotion. Findings from the NSCA Market Intelligence Briefings reveal that less than 21 percent of integrators say they have an up-to-date, written marketing plan or a brand positioning statement. Another 20 percent indicate they have nothing more than a budget for promotional activities.
Why would a company not have a marketing plan in an industry built on design and planning? The reasons integrators give for not having a marketing plan range from time constraints to not seeing the value of a plan. Some also offer the “moving target” rationale, arguing that situations change too quickly and thereby limit the value of a written plan.
That said, about half the integrators (48.4 percent) in the NSCA study on marketing and promotion said they have in informal marketing plan (see “Marketing Plans,” below). An informal plan could be anything from ideas sketched out on the back of an envelope to an on-the-fly decision based on someone's idea.
That's not good enough, and many integrators know it: About one-fifth of the informal planners said they see the value of developing marketing plans in the future. And they can learn from the companies that already do so. Of those systems integration firms that do have marketing plans, signs are they consider it a team effort, with the majority indicating the plans are created with input from the sales staff. Why sales? About a third of the integrators indicate that the objectives of the marketing plan are tracked against sales successes.
Of course, a marketing plan isn't worth a whole lot unless a company can put some resources behind it. And that doesn't seem to be happening. A stunning finding of the NSCA studies is that integrators allocate relatively meager budgets to marketing and promotion. As a group, systems integrators said they budgeted an average of just 2.9 percent of their gross revenue for marketing and promotional activities in 2007 (for more, see “Marketing Budget Trends,” page 62).
NSCA's 2007 Financial Analysis of the Industry offers the bigger picture of other expenditures competing with marketing for dollar, not the least of which is training. The good news is, integrators know they need to spend more on marketing, especially in such a competitive industry. Those in the NSCA survey anticipate devoting 3.4 percent of their gross revenues for promotional activities in 2008. While still small, this represents a 31 percent increase year to year.