This storehouse of marketing wisdom is an effective antidote for those who have lost sight of the basics, and a valuable road map for those seeking a marketing mindset.” Limitation of Liability/Disclaimer of Warranty: Although the publisher and author have used their best efforts to prepare this book, they make no representations or warranties as to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose.
The thoughts in this book are the result of my own meditations on these basic marketing concepts and principles. Some great thinkers in business and marketing are quoted directly, or they directly influenced the thinking here.
I said a long time ago, “Marketing is not the art of finding clever ways to put away what you do. Or if you want a more detailed definition: "Marketing is the business function that identifies unmet needs and wants, defines and measures their size and potential profitability, determines which target markets the organization can best serve, decides on appropriate products, services, and programs that serve these select markets, and calls upon everyone in the organization to think and serve customers.”
The company works with the media department of the advertising agency to determine how much reach, frequency and impact the advertising campaign should achieve. One of the former big spenders, Sergio Zyman, former vice president of Coca-Cola, recently said, “Advertising as you know it is dead.” He then redefined advertising: “Advertising is much more than a television ad—it includes branding, packaging, celebrity endorsements, sponsorships, advertising, customer service, the way you treat your employees, and even the way your secretary answers the phone.”7 What it really does is define marketing.
When a brand is successful, the company will want to put the brand name on additional products. The brand name can be placed on products introduced in the same category (line extension), in a new category (brand extension) or even in a new industry (brand extension).
As video conferencing improves and costs decrease, companies will reduce the number of field visits to customers and save on the high costs of transportation, hotels, dining and entertainment. Another force that may diminish the role of the sales force is the rise of web-based marketplace exchanges.
Top management must rally support and use internal marketing to effect change in the organization. The best defense against change is to create a business that thrives on change.
Thomas Davenport and John Beck point out in The Attention Economy that the abundance of information leads to attention deficit disorder (ADD), the difficulty of getting someone's attention.11 The attention deficit is so pronounced that companies have to spend more money on marketing than the product . Consider that the creators of The Blair Witch Project spent $350,000 to make the film and $11 million to market it.
Then we heard from Jim Collins and Jerry Porras in Built to Last (1994),13 Michael Treacy and Fred Wiersema in The Discipline of Market Leaders (1995),14 Arie De Geus in The Living Company (1997),15 and most for recently from Jim Collins again in Good to Great: Why Some Companies Make the Leap. Customer-centric companies achieve steady gains in share of mind and share of heart, which leads to higher market shares and in turn to higher profit shares.
Singapore Airlines continued to improve its quality, but Catha Pacific improved its quality faster and faster, gradually closing the gap with Singapore Airlines.
In the short term, the most dangerous competitors are those that are most similar to your company. Customers can't tell the difference. According to marketing guru Theodore Levitt: "The new competition is not between what companies produce in their factories, but between what they add to their factory output in terms of packaging, services, advertising, customer advice, financing, delivery arrangements, warehousing and other things, which people value.”18.
Peter Drucker says his greatest strength as a consultant is that he is ignorant and asks a few basic questions. The cynicism simply means that there are good and bad advisors and it is your job to be able to tell the difference.
As far back as the first century B.C., Publilius Syrus, a Latin writer, observed: “Many are advised, few benefit.” Robert Townsend, former CEO of Avis Rent-A-Car, described consultants as “people who borrow your watch and tell you what time it is and then walk away with the watch.” William Marsteller, from Burson-Marsteller's PR department, added: "A consultant is someone who knows nothing about your business, who you pay more to tell you how to run it than you could earn if you run it right, rather than the way he did it. tells you.”. That's why Caterpillar has been able to launch Cat jeans, sandals, sunglasses, watches and toys, all designed with the same features in mind.
For example, in trying to move something from one point to another, consider the type of vehicle (trolley, chair, sling, bed), the medium in which/with which the vehicle operates (air, water, oil, rollers, rails ), and the power source (compressed air, motor, steam, magnetic field, cable). For example, to develop a new cleaning aid, decide on the user (male or female); type of aid (deodorant, shaving product, cologne); type of packaging (stick, bottle, spray); market (merchant, gift); and channel (vending machines, retailers, hotel rooms).
Greg Carpenter and Kent Nakamoto challenged a core assumption of marketers that buyers initially know what they want.20 Instead, they learn what they want. Different brand competitors are adding new features to their computers, cameras and cell phones that buyers may not have known about or asked for, and in the process, buyers are forming a better idea of what they want.
To be truly customer-centric, the company should be run by customer managers (or customer group managers), not brand managers. Assets → Inputs → Supply → Channels → Customers Because they are product driven and heavily invested in assets, they push their offerings to every customer imaginable and fail to notice the differences and values of customers.
Customers→Channels→Offers →Inputs→Assets By starting with an understanding of customers, the company is in a much better position to develop appropriate channels, offers, inputs and assets. By examining a customer's previous purchases, demographics and psychographics, the company will know more about what the customer might be interested in.
Jack Welch, retired CEO of GE, put it this way: "The best way to keep your customers is to constantly figure out how to give them more for less." And remember, customers increasingly buy on value, not on relationships. alone. The second group is the most growable customers (MGCs), which deserve the most long-term attention.
Powers gave the Honda Accord the number one rating in customer satisfaction for several years, helping to sell more Accords. Honda says, "One reason our customers are so satisfied is that we are not." Cigna advertises, "We'll never be 100% satisfied until you are, too." But don't make too big a claim.
You need telemarketers calling a sample of customers every business day to update the information. Supermarket chains have mountains of scanner data on individual customer purchases, but fail to use this data for one-to-one marketing.
Just consider "Easy to learn how to use". I recently purchased HP/Compaq's iPAQ, personal digital assistant handheld computer. I could not remove a cellophane cover (not mentioned in the brochure) nor open the protective plastic cover of the device nor figure out how to get the cover to the other side.
Frank Perdue, maker of one of the most popular chicken brands, would boast: "If you can tell a dead chicken, you can tell anything." No wonder one professor tells his MBA class that any student who uses the word. A lower price?” "No." "A better package?" "No." "A clever advertising campaign?" "No." "Better allowances for trade?" "No." "Then how do you expect to take away part of Gillette?" "Plot determination" was the answer.
No wonder Peter Drucker said, “The biggest change will be in distribution channels, not new methods of production or consumption.” Choosing the right channels, convincing them to sell your merchandise and getting them up and running as partners is a big challenge. First, the quality of products or services may suffer because the company has gained market coverage at the expense of market control.
A company must ensure that its employees understand that they do not work for the company. They are customers.” Some companies add a note to the employee's pay envelope: “This check is presented to you by the customer.”.
Sam Walton of Wal-Mart required the following employee pledge: "I solemnly swear and declare that every customer that comes within 10 feet of me, I will smile, look them in the eye, and greet them, so help me Sam. " End instructs his employees: "Don't worry about what's good for the Company - worry about what's good for the customer." (See Innovation.).
The goal of the experiential marketer is to add drama and entertainment to what might otherwise pass for old-fashioned fare. Or we go to Bass Pro to buy a fishing rod and test it by casting the fish in the shop.
Marketing efficiency involves reducing the cost of activities that a company must perform. If the company invited competitive bids, it might find a lower price for the same or better quality.
Look for latent or adjacent members in a niche. USAA realized that eventually there would be a shortage of military officers to sell to. The best defense against the vulnerability of a single niche is to own two or more niches.
Pierce of Bell Labs beautifully explained why so many predictions fail: "The problem with the future is that there are so many of them." The incomparable Yogi Berra said that "prediction is very difficult, especially about the future." He also despaired: "The future is not what it used to be."
He believes: "The best way to predict the future is to invent it." Your company faces an infinite number of futures and must decide which one it wants. If you don't know where you're going, you can end up somewhere else." But how do you set a goal?
The late Roberto Goizueta told his company Coca-Cola that while Coca-Cola had a 35 percent share of the soft drink market, it only had a 3 percent share of the overall beverage market and that it needed to increase its share. Citicorp thought it controlled a substantial portion of the banking market, but realized it controlled only a small portion of the overall financial market, which is much more than just banking.
Saturn will take back its new car within 30 days if the customer is not satisfied. BBBK Pest Control will refund the customer's money if it fails to eradicate all pests and will pay for the next exterminator.
Emotional Marketing
A marketing research firm would ask, "How old is this company?" (The answer might be a "teenager" in the case of Apple Computer and a . "grandfather" in the case of IBM.) Or "Which animal does this company remind you of?" (Hope for a lion or a monkey, not an elephant or a dinosaur.).
A large bank announced a new savings plan in newspapers but did not explain the plan to its branch managers. The best way to get their buy-in is to have them participate in the development of the plan.
One form is real-time inventory management, where a marketer can tell what the company and its competitors sold yesterday, including features and prices. Another form is real-time selling, where a company has programmed in rules that suggest other products and services that can be mentioned to a customer or customer on the spot.
Every company is a potential hotbed of ideas, except that the company fails to encourage them or lacks the network to capture them. The idea manager has a committee that finds better ideas and rewards those whose ideas the company implements.
In fact, the market for their products and services may be mature domestically and growing abroad. Companies entering developing countries must offer new benefits or introduce their products at a lower price.
Bill Gates, chairman of Microsoft, sees the Internet as indispensable for companies: "The Internet is not just another sales channel. However, smart marketers and businesses did not ignore the potential of the Internet and added an online presence.
The vision must burn in the leader's chest if it is to spark a passion in others. The chief task of the CEO is to build a team of experts who are aligned with each other and with the company's primary objectives.
And loyal customers repay the company with long-term cash flows and by generating a stream of referrals. Why not offer a trade-in plan for old equipment and a calling plan that costs less every year the customer stays with the company.
Peter Drucker commented, “Ninety percent of what we call 'management' makes it hard to get things done.” Don't say anything until the meeting is half over; this you mark as wise.
Department Interfaces
Marketers complain about customers buying cheaper inputs, resulting in the product not having the quality promised in the value proposition. I advise marketers to work more closely with purchasing people, not only to ensure good quality, but also to learn from them about sales.
Different members come to appreciate each other's points of view and hopefully this will lead to better understanding. The Reputation Institute and Harris Interactive collect public ratings of the companies they most admire.
Marketing instruments are selected that match the phase of the product life cycle. Yet, in many companies, responsibility for different elements of the marketing mix lies in the hands of different individuals or departments.
5. Budget. The company's planned actions and activities incur costs that add up to the budget it needs to achieve its objectives. 6. Controls. The company must establish evaluation periods and measures that show whether it is making progress towards the goal.
While focus groups are an important preliminary step in exploring a topic, the results are not projectable to the larger population and should be treated with caution. To the extent that external variables are controlled, the company can attribute response differences to differences in supply.
The company needs to take a broader view of the company's sector, its players and its evolution. The company must assess the impact of its actions on all of the company's stakeholders – customers, employees, distributors, dealers and suppliers – not just shareholders.
At the other extreme, we can talk about a "market of one" to describe a specific individual or company that a marketer might care about. IBM would call market one for consultants who spend all their time selling their services only to IBM.
These brokers offer thousands of listings, such as "women executives who earn over business professors who teach marketing" and "motorcycle owners." You can try a sample of names from a promising list.
Johnson & Johnson prefers to prioritize its goals: its first responsibility is to customers, second to employees, third to the community, and fourth to shareholders. Most mission statements contain the right sentences: "People are our most important asset." "We're going to be the best at what we do." "Our goal is to exceed expectations." "Our goal is to generate above-average returns for our shareholders." A lazy way to prepare a mission statement is to put them together in any order.
Even with the right price, you could really make money with a follow-up product. Columnist Earl Wilson observed, “Benjamin Franklin may have discovered electricity, but the man who invented the counter made money.” By analogy, Xerox invented Ethernet, the graphical user interface, and the laser printer at its Palo Alto Research Center (PARC). , yet Netscape, Apple, and Hewlett-Packard made money.
One of the biggest opportunities today is to invent businesses that can charge significantly lower prices than their competitors and still be profitable. They reinvented their industry to be able to offer significantly lower prices than their competitors.
Siemens assigned a single senior-level manager to each industry to have authority and accountability to orchestrate interdepartmental collaboration related to each industry.
What makes a company great is that it has created a set of core competencies that are ingeniously linked together and are altogether difficult to imitate. They have outsourced some activities, but what makes these companies great is that they have reserved for themselves a set of interrelated competencies and capabilities that defy any easy imitation.
For service support, you can use "on time, first time fix" to know the percentage of times the service person arrived on time and fixed the product perfectly. Percentage of customers who fall into very dissatisfied, dissatisfied, neutral, satisfied and very satisfied categories.
It would be too difficult or too expensive for a company to be the best in all three value disciplines. Crawford and Mathews believe that a company will suboptimize if it tries to be the best in more than two ways.
Peter Drucker adds another concern: “Worshiping premium prices always creates a market for a competitor.” And the internet makes it easier for people to compare prices and head for the cheapest offer.
The late Bruce Henderson, who was head of the Boston Consulting Group, warned: “Most products in most companies are money traps. At the same time, the best product does not always win the market.
Here is the story of a company that thought its profits lay in cutting costs. A low-priced firm makes less revenue from its sales (because its price is lower), but generates significantly more sales per dollar of assets (because more customers are attracted by its lower price) .
Building a new brand through PR takes a lot more time and creativity, but it can ultimately do a better job than "big bang" advertising. A company planning to build a new brand needs to create a buzz, and the buzz is created through PR tools.
It's what the client or customer gets out of it.” The electronics giant Siemens has the quality motto: "Quality is when our customers come back and our products don't." Quality is our best guarantee of customer loyalty, our strongest defense against foreign competition and the only path to sustained growth and earnings."
Second, don't arbitrarily shift the cost burden to your suppliers and dealers without consultation. If a company has the resources, it may view the recession as an opportunity to grow its business at the expense of its competitors.
Relationship marketing (RM) marks a significant paradigm shift in marketing, a shift from thinking exclusively in terms of competition and conflict to thinking in terms of interdependence and cooperation. It recognizes the importance of different parties – suppliers, employees, distributors, dealers, retailers – working together to deliver the best value to target customers. RM favors more integrated marketing communications to deliver the same promise and image to customers.
The three factors of retail success were "location, location, location." With the advent of the Internet, physical location is less important. The next step was for retailers to carry two or three store brands of varying quality and price levels.
Then compare this salesperson's performance to the average salesperson's performance to detect poor or exceptionally good performance. Marketing uses advertising and telemarketing to find and qualify leads that can be passed on to the sales force.
It is better to use sales promotions in product markets with large differences, where new customers may discover that they like your product and its features better than their previous choice. Sales promotions are typically used more by weaker and smaller brands than by stronger brands.
The second approach is to segment the market into groups of needs, such as "women who want to save time on grocery shopping." This is a clear need that can be met by a number of solutions, such as a supermarket taking phone orders or online orders that would be delivered to the home. The third approach is to segment the market by behavioral groups, such as "women who order their food from Peapod and other home delivery groups." This group is defined by their actual behavior, not just needs, and the analyst can then look for common characteristics they may have.
He sent an order-taker to the island who, after a cursory investigation, returned: “The people here don't wear shoes. We will pay out $20,000 in the first year, which, given our investment, will give us a rate of return on our investment (ROI) of 20 percent, exceeding our normal ROI of 15 percent.
Call your company as if you were a customer and ask the employee a few questions. Call to return a product or complain about it and see how the employee handles it.
If the money does not generate increased sales or corporate capital, then it is an expense. If your company is going to sponsor something, make sure it's a reasonable and appropriate match for your target market and type of product/service.
Such companies cannot be easily copied due to the unique fit of their business processes and activities. As stated by Al Ries and Jack Trout, "Strategy should evolve out of the mud of the market, not in the antiseptic environment of an ivory tower."
These prime suppliers are treated as partners who invest together in the success of the customer. Rolls-Royce calls Boeing "the toughest customer we have" and they are grateful for that.
John Bogle, founder of mutual fund company Vanguard, said: "We never wanted to be the biggest, but the best." When choosing a market, remember: it's easier to sell to people with money than people without money.
It would be better to focus on a specific industry or profession and reach out to the associated small businesses through someone who has prestige in that industry or profession.
