Where Marketing adds its greatest value
Shortly after I got up this morning, I strolled over to Marketing Over Coffee for a quick shot before heading off to work and found this great article, entitled How to restore the faded luster to marketing by Rich Guha. In my opinion, it's a "must read" for anyone looking to build a business or aiming to build a career in marketing.
It's about the big picture
Referencing management heroes such as Peter Drucker and Ted Leavitt, the article discusses what companies have lost as marketing becomes more specialized. Guha advises marketers that wish to add significant value to the business to:
- Step back from tactics and understand the "theory of the business."
- Understand what are the ways to measure performance which drive market value.
- Understand which levers in the business will increase market value.
- Regard tactics as components that can only be used with an understanding of the entire business plan.
- Understand the customer and end user intimately.
- Focus on Product, how it is priced, presented, and where it is available to customers.
It takes intimacy and integration to hit the mark
In short, he emphasizes the importance to successful businesses of a) understanding customers' needs across the spectrum (yes, back to the 6 Ps*) and b) understanding which levers in the business will increase market value. Without these important capabilities, front and center, companies often end up missing the mark and spending way too much on "marketing".
Guha quotes Drucker as saying, "If Marketing were to do its job perfectly, Sales would not be needed." In other words, if you really understand all aspects of a prospects' needs , products would sell themselves.
This is not the same as "build it and they will come". The needs to which Guha and Drucker are referring, go way beyond the product features and benefits.
Upfront investments in market intelligence save money
Nevertheless, Marketing can't do the job perfectly. That would require mind reading. Still, an upfront investment in marketing research can save a lot of money down the road-if either the product, or its promotion and distribution, will cost a lot to accomplish.
There are many ways to gather prospect information from surveys to customer shadowing to watching click streams. The key is knowing what you're looking for, and how to use the information you get.
Else, you're likely to miss the market window. Or, if you're "lucky" spend a lot of money on rework until you get it right.
Start with deep customer insights
Therefore, a lot of companies are investing in developing buyer and user personae before making the much larger investments in product development and content. They capture the "voice of the customer" and then create archetypes for the three to five most important roles at the companies in their target market.
To bring these archetypes to life, many companies give them names. These examples help multidisciplinary teams discuss and figure out "What Jane would do" or how "Mike would like to receive information".
Test, iterate, refine
The most successful companies do this in an iterative fashion. They gather information, form hypotheses, test their hypotheses, and then refine their hypotheses until they hit the measures they've set as goals.
Use high-fidelity prototypes
In the development world, see Eric Ries and Cindy Alvarez' work on lean start-ups (although there is broad applicability for other product development groups). In the usability world, see Jared Spool's and Carolyn Snyder's work on high-fidelity prototyping.
Watch customer behavior
As for communications, hypothesis testing is now the province of analysts that study click streams. There, however, companies are still working out the timing .
Since digital communications are relatively inexpensive to produce and deliver, many companies delay testing until after they launch. It's too early to have definitive data on how early missteps affect branding, or the extent to which upfront research could have prevented extensive rework.
Marketing never stops, always changes
Nevertheless, it's not a perfect world. You can't anticipate all customer needs upfront.
Things are always in flux. Economic conditions improve. Regulators introduce new rules.
Technology innovations make the improbable possible. Competitors' actions cause priorities to shift. For these reasons and others, it's essential to gather information on an ongoing basis.
Assess which actions will have the greatest impact
As mentioned above, however, it's equally important to know how to use the information you gather-or as Guha notes know which levers will increase business value. This is especially important in a tight economy where companies can only afford to take the most effective actions.
Too often, companies focus too much on one of the "P's", to the detriment of the overall marketing effort. Engineering firms will sometimes focus all their efforts on fine tuning the product, while "marketing organizations" expend too much on a particular type of promotion, relative to the return they'll get on that investment.
This is where true marketers, who work with multidisciplinary teams, add their greatest value. By understanding the whole customer, his/her environment, and impending change, he/she can help the company optimize the resources it takes to unite customer and solution.
*Product, positioning, packaging, pricing, promotion, placement (sales channels or distribution)
by Barbara Bix - In tough economic times, more and more clients are looking to their accountants to help them improve the bottom line. Often, the best way to do that is to start with the top line-since one can only decrease expenses so far. This blog discusses concrete actions you and your business-to-business clients can use to accelerate revenues.