For many of us in the senior living profession, it’s that time of year again. Yes – it’s budget time.
While some dread it as a tedious time of drudgery and numbers crunching, others view it as a fresh opportunity to create or refine strategies that will elevate their community’s position in the marketplace. It may not always be fun, but it is important. The decisions you make now will either limit or optimize your chances for success in 2016.
You’re certainly not alone if you are asking, “Where should I begin? How much should I budget? What data should I be looking at? How can I be sure of what’s working and what isn’t? What am I missing that might be valuable going forward?"
With that in mind, we will touch on some effective ways for developing a powerhouse budget plan for the coming year. In Part 1, we’ll talk about the importance of “looking in the rearview mirror” at 2015. In Part 2, we’ll discuss the current “Must Haves” for optimizing your marketing effectiveness in 2016.
Take Stock of Where You Stand Today
Melinda Schmitz, Executive Vice-President of Sage Age Strategies, says,“I’m frequently asked by communities to help them in assessing their sales and marketing platforms, including their budgets, specific strategies and tactics. As a starting point, I always recommend looking back at their experience to date. Before we can build the next budget plan, we need to look carefully at the successes, shortcoming and missing pieces of the current plan.”
“Always learn from the past and use that knowledge to continuously refine and improve on what you’re doing going forward. What the Japanese call, ‘Kaizen.’”
Make sure your marketing budget and related plan don’t exist in a vacuum. They should be joined at the hip with your community’s overall strategic plan and priorities. In addition, be sure you have specific implementation plans and measurable goals for each budgeted area so you know if your expenditures are delivering the expected returns.
Separate Your Winners from Your Losers
Melinda adds, “Some experts suggest looking at your budget plan as you would your investment portfolio. That is, which of your marketing budget components are underperforming, which are delivering value and what new investments, if any, should you be considering for the next year? While this may seem like an oversimplification, it does make the important point that it is critical to distinguish your ‘winners’ from your ‘losers.’
“If you have an integrated marketing plan that uses a variety of traditional media (such as print advertising and radio), social media, public events, educational seminars, incentives and digital marketing, it can be rather complicated to separate the ‘wheat from the chaff.’ However, getting a handle on this is crucial to building a budget that optimizes your expenditures on the strategies that are working and minimizes or even divests those that are not.”
“Understandably, not all senior living communities have the bandwidth in terms of resources and skill sets to conduct this critical assessment effectively. We frequently provide a helping hand to communities to ensure they are spending their money wisely, based on the evidence at hand and guided by the latest marketing best practices.”
“The last thing you want to do is spend good money after bad in your new budget. Few communities that I know can afford to do that today.”
As to how much you should spend on marketing, McKinsey & Company a global management consulting firm, recommends that a firm spend five percent of its gross revenues on marketing. Some experts say that small organizations should budget a bit more to help them compete with larger competitors.
What matters most is how you spend the dollars you budget. Again, try thinking of the budget as your personal investment portfolio and your money. Put your money behind your winners and minimize or scrap your losers.
Budgeting Basics for 2016
Melinda’s sound advice can be summarized as follows:
- Review and Evaluate – Critically assess your 2015 marketing budget plan and the results it has produced for you. Also, consider what your key indicators for success are. Tracking and measurement are key here. For example, you might have a dashboard that consists of your primary drivers of success and lists the budgets and goals for each. One example might be “lead generation.” Are you generating a sufficient number of quality leads and closing on an appropriate percentage of them with your current plan? If not, why?
- Use ROI to Reallocate Resources – Look at the return on investment you’re getting from the various marketing investments you’ve made to date. Which ones are working and which are underperforming? Make sure your new budget effectively rewards your winners (i.e. allocates appropriate dollars to the strategies and tactics that are showing results).
- Consider Critical Missing Pieces – The advance of technology has produced new digital marketing techniques for identifying, engaging and tracking prospects as well as fully optimizing your brand for “Page One” search results. It is important to know what these are and to consider their cost-benefit to your organization. This should include the risks of not applying them in a competitive environment.
These are some quick pointers to help you get started with your 2016 budget process. In Part 2, we’ll look at the key building blocks (i.e. “Must Haves,” for a successful marketing plan today).
Learn More About Growth-Based Best Practices Today
Sage Age Strategies is the ideal partner for strategically growing your sales and building your census. If you are a senior living provider considering the need for assistance in increasing your sales and growing your community through best-practice digital strategy, marketing plans and budgets, communications and creative design, contact us today for more information.
Sage Age Strategies is a multiple award-winning, strategic growth and marketing organization that operates exclusively in the senior living industry and was recently named one of Inc. Magazine’s Fastest-Growing Private Companies in America. For more information, please call or email Adrienne Mansfield Straub today at 570-601-1720 ext. 100 / firstname.lastname@example.org.