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Metrics For Adding Employees To Centralized Mktng
Posted By: docfraz* on 8/26/2004 6:16 PM (CST) 250 Points
We are an Insurance Company trying to establish metrics for assessing when to budget additional employees to centralized marketing and outside sales support. We are in 16 states with 100mm in revenue and currently have only 4 people in Centralized Marketing. We currently have one sales manager per state with a few exceptions.

Posted by: psimone Accepted Answer
8/26/2004 6:56 PM (CST)
Dear docfraz,

WOW - in 16 states and only 4 marketing people - they must be swamped with work! Also theres a lot of grey area that needs to be clarified before any sort of definitive answer can be given ....

To start off ...Would need to know your position. Are you a leader in those 16 states, or just getting established? Are you currently aggressively positioned with print/radio/internet/direct mail/tv campaigns, or do you get a lot of word of mouth, referral business? Are your sales driven by a consumer base or business focused?

Even not knowing any of above would seem you should have several more people on the marketing staff, and that staff responsibilities should be divided, so each team would manage certain regions. Re outside sales support, would need to know number of localized sales reps that are already in each region/state, and the amount of territory they are responsible for covering, in order to assess whether you're on target with sales managers and other sales support staff.

Last but not least, important factors that would color any response include the following: Are you striving to maintain current market share, grow current market share, or reach out to new demographics, and what is your current marketing budget?

Hope this helps in your assessment!
psimone
 
Posted by: ASVP/ChrisB Accepted Answer
8/26/2004 8:10 PM (CST)

I have a feeling you are looking for a concise formula here and I don't think the answer is as simple as all that.


There are multiple factors you may need to take into consideration in any empirical calculation used in forecasting resource requirements, some of these may include:


  • Role of people in centralised marketing dept

  • Extent to which you outsource marketing/sales support functions

  • Level of customer/channel sales support enquiries you are getting each business
    day

  • Number of marketing programs being initiated by the centralised team per
    month

  • Marketing team involvement in product development, and ongoing marketing
    mix manipulation (price, distribution, promotion, etc. (4+Ps)

  • Extent to which marketing team is involved in sales management particularly
    when revenue/margin budgets are under pressure.


To be able to provide a more precise response you would need to give much more detail about current activities, call levels, etc. I would suggest you consider hiring in a consultant like Jett
to assist you with the project.

Hope this helps.


ChrisB
 
Posted by: docfraz* Author Response
9/3/2004 10:55 AM (CST)
We are aggressively pursuing market share in each of our 16 states and adding 2 to 3 more states by year end. We are a market leader in 4 of the 16 states and have just added 6 of these states in 04.

We sell exclusively through independent insurance agents with a minimum of 100 agencies in each state. These agencies are who we currently market to in order to sell our product. We have not yet done any direct marketing to the end user in any state in which we do business.

The product is workers compensation insurance sold to small businesses.

We currently have a total of 11 sales reps for 16 states.

Current marketing budget is in development, but would likely be based on percentage of revenue. Currently around 1mm not including salaries.
 
Posted by: jose04 Accepted Answer
9/3/2004 3:57 PM (CST)

Hello docfraz

Workmens compensation insurance..100mm rev..1mm marketing budget..metrics for addl employees to central mrketg and sales.

Knowing that your roughly 16 sales managers coordinate about 100*16 agencies is a lot of interaction generated. Your lead generation efforts must be quite efficient to take leadership positions as you have already. However to work as a smoothly functioning outfit, and when the market grows in size, data generation on, type of lead generation, conversion of leads, loss of customers, number of followups required before a confirmed cheque is received, etc., would be necessaty to take your decisions on expanding the state wise teams (to create, maybe territory managers positions) under each sales manager.

The number and timing of transactions derived out of the analysis should give enough ideas on how to classify and convert them into job descriptions. THis should be correlated with the expriential opinions of the status quo of the market and its potential, the response rates of the leads worked on etc., usually found in a market potential statement analysis. A conference involving all the state managers in the HO will be opportunities they rightfully get/use to air out their needs. This will enable and hopefully confirm a validation of the statistical assessment of the past operation performance records.

Your bottomline for enhancing centralised staff should be based on your close examination of an increasing customer satisfaction atropy rate, which is usually correlated highly with high customer downtime rates. In other words if customer attitudes towards your compensation packages, processing and reimbursement time is not satisfactory (due to poor back up systems), then it is also likely that the understaffed state level units need to be spruced up. However, if the opportunity costs of operations processing being centralised is a better option, then this decision should also be approved by the sales manager team. Increasing staff should be decided on, keeping in mind, workload, increasing fixed costs, training costs and other related costs issues. Your marketing budget could be a clever combination of % of revenue and customer satisfaction rates assessments.

Hope these thoughts help!
 
Posted by: Sharon Moderator Response
9/12/2004 6:39 PM (CST)
Hello all. I am closing this question. This is standard procedure when the question author gets busy and falls out of the conversation for a while – or doesn’t understand the procedure for closing.

Thanks for participating!
 


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