“The Impact of Marketing Skills on Business Growth, Prosperity, and Survival: Insights from a Randomized Controlled Trial in Collaboration with the World Bank” by Stephen Anderson-Macdonald (Stanford University), Rajesh Chandy (London Business School), and Bilal Zia (World Bank).
The World Bank team presented evidence from the first randomized evaluation of the impact of sales and marketing skills training relative to finance skills on business practice and performance. The empirical setting of the research was among micro-enterprises in Cape Town, South Africa. The team offered intensive sales and marketing training to one randomly selected group of entrepreneurs, intensive finance and accounting training to another, and no training to a control group. It found that marketing skills have a substantial impact on business growth, employment, and prosperity. Both financial and marketing training increased profits by an average of 61% and owner happiness by about 10%. However, while financial training tended to improve profits relative to the control by reducing costs, marketing increased them by growing the business and employing more staff.