Just when many businesses are cutting back on marketing efforts, investing in long-term brand-building alongside ongoing marketing activities is a rare and attractive opportunity for smart businesses to gain a competitive advantage when the recovery begins.
As your competition dials down their activity in the market, strategically dial it up to win over new customers and capture prospect data. It could be one of the most cost-effective times to make huge gains in company advertising.
Share of Voice and Share of Market
The relationship between turning up the volume of your brand’s voice with long-term brand-building remains closely linked to predictable growth.
Businesses that invest in their share of voice (SOV) can rely on increasing their market share (SOM) with confidence. To do so, CEO’s must first understand their brand’s SOM and SOV and adjust their focus accordingly.
Share of Market (SOM)
Share of Market is the percentage of the total revenue or sales in a market that a company's business makes up.
Share of Voice (SOV)
Share of voice is a metric that allows you to compare brand awareness on different marketing channels against your competitors.
Extra Share of Voice (ESoV)
When a brand’s share of voice is larger than its share of the market, it is said to have an extra share of voice (ESoV).
- Investing in the market reliably leads to growth.
- Just investing in increasing your ESoV by 10 percentage points is enough to generate a 0.7% in Share of Market.
- A business with 10% SOM must increase its SOV to 40% (30 points above SOM) to grow its market share by 2.1% (3 X 0.7)
- It’s a simple formula. Need more growth? Just add more SOV.
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Shout Loud for Growth
The SOV equation is reliable across all sectors, in all market conditions—and the conclusion is simple: Investing in your share of voice reliably leads to new business and growth of your market share.
Whether in boom times or tougher times, increasing your SOV with brand-led marketing is a wise commercial decision. During challenging times there are fewer buyers in the market; meaning those that seize the opportunity to reach them are more likely to continue growing.
Investing in brand awareness in more challenging times can boost the return you see on sales growth, even over better times.
The “Extra Share of Voice” Effect
Following the financial crisis of 2008, the Institute of Practitioners in Advertising (IPA) surveyed brands to determine the link between ESOV and growth during an economic crisis.
Brands that extended their SOV by just 8% enjoyed more profit, sales, market share, and customer loyalty than brands that did not.
In addition, 38% of these forward-thinking brands reported ‘very large’ profit growth.1
Sales-Led Marketing from Forge®
There will be no ‘new normal’. The socio-economical landscape is changing so rapidly that the world could have lived through more ‘new normals’ and ‘unprecedented’ events in the time it has taken to write and produce this content.
However, the basic principles of emotive long-term and rational short-term sales and marketing working in synergy to engage the whole market will hold true.
We Get Sales
While working with owner-managed and private equity-backed SMEs over the past two decades, we’ve lived with CEOs and sales teams through the challenges affecting every industry.
The Forge® team is uniquely positioned to understand how the right sales and marketing formula can help survive and thrive through the next five years, especially if you’re heading towards an exit.
Moving forward into the next five years and beyond, CEOs need support from a team that knows that the best marketing is really all about sales and is ready to campaign by your side until your marketing strategy is your business’s most significant single sales contributor.
