Wednesday 29 September 2010

The economic sense in segmenting your market

There are many different ways to categorize marketing, but one very simple way is this:
  • Undifferentiated
  • Differentiated
  • Concentrated
Undifferentiated marketing is where everyone in your target market is treated the same. TV advertising reaches everyone – those who want clean, shiny floors and those who have no interest in clean shiny floors.

Differentiated marketing segments the target market into groups with common interests. With some knowledge of these common interests, you can then tailor your message more precisely. So you don’t sell cleaning products to teenagers, for example. Or recruitment services to corner shops. That sort of thing.

Concentrated marketing is where marketing messages are aimed at a small, precise market. For example, a company might choose to market to artisan cheese makers in Wigan or museum curators outside of the capital. I practice, I'm not absolutely sure how this differs from differentiated marketing.

This idea was first put forward by Philip Kotler, and sounds eminently sensible. In fact much of marketing theory has been built on the idea of differentiated marketing, or segmenting the market.

When resources are limited (which they always are) choices have to be made. Figuring out which part of the market is most likely to respond to offers of what you sell makes good economic sense. Whatever label you put on it.

Thursday 16 September 2010

Do you love or hate your marketing systems?

Software systems - you either love ‘em, or you hate ‘em. Well, actually, for the most part we love them (and need them) and hate them (when they don’t do what we want).

Sales and marketing has become too complex to manage without systems: those that you love and those that you hate. Sales people are well known for being rather wary of CRM systems – for good and bad reasons. Marketing people would like to manage without, but can’t.

But whether it’s a manual process or a software system, systems of all sorts are vital for efficient and effective sales and marketing.

It’s not always easy to tell whether a system is effective or not. We have all come to rely on email, but the time saved in being able to send a message with hardly a thought has meant we have so many more messages to read. So the time saved is now spent sorting and figuring out what is important and what is not.

It’s the same with many other systems. Customer Relationship Management (CRM) systems can hold an enormous amount of data, but can you see the information you need? Can you identify whether time and effort is being spent with the right customers with the right results? Not always ....

So it’s worth stepping back from time to time and thinking about what you and your senior team really need to know about your marketing. Are your systems alerting you quickly enough to problems? Are they providing sufficient visibility into what’s happening? And if they don’t, what can you do about it? Another report? Collecting different data? Or pulling together information that’s already there so you can see the situation more clearly?

Marketing is all about difference – demonstrating to your customers why you are different, and providing a better solution to their problem or opportunity. Be different, and create systems that enable you to do that better than any of your competitors.

Wednesday 15 September 2010

4 P’s: Is the marketing mix out-dated?

If you have heard about marketing, you have heard of the 4 P’s: product, price, place and promotion. Sometimes a fifth P is added: people.

The 4 P’s have become a standard model for thinking about marketing. But what if they are wrong? Or at least, what if they are out-dated?

Marketing in today’s digital economy is a complex and confusing business. Hugely successful companies such as Dell have numerous Twitter accounts whilst the rest of us try to figure out what the platform is all about. Whilst marketing is becoming more important, it also has to work in a more fragmented and increasingly noisy marketplace. Gone are the days when advertising in the relevant print publication sorted out the year’s marketing.

Maybe today’s marketers need better tools than just to figure out what they are selling, at what price, how they will get it to customers, and how to promote it.

So if the 4 P’s are out-dated, what should take their place? For service oriented businesses, SIVA is a better variation: Solution, Information, Value and Access. These equate exactly with Product, Promotion, Price and Place, but put the emphasis on how the customer sees the transaction, rather than how a company views its marketing.

But what about strategy? What about the competition? What about positioning? Target market? Measurement?

These are all elements that can make a huge difference to the success of marketing initiatives. The alliteration isn’t so neat, but the components are necessary for successful marketing.

Whilst models can be helpful, they are only models. And if the model is out-dated, or plain wrong, they might hinder more than they help. Is it time for a 21st century model for marketing?

Friday 10 September 2010

Make your Goals Realistic

As regular readers of Getting to Excellent already know, I think setting goals is tremendously important. Goals improve performance by focusing the mind on a particular outcome, help to remove distractions, and provide motivation to achieve something. So as a tool to manage ourselves, and other people, they are kind of handy.

But they are not simple little beasts - far from it.

A goal that is too easy encourages complacency, and might even result in something not getting done at all, or taking too long to do.

A goal that is too difficult becomes demotivating because you don’t/can’t achieve it, and either blame yourself for poor performance, or whoever encouraged you to try for the goal. Either way you come away dispirited and sure that “setting goals doesn’t work”.

What’s wrong in both cases is that not enough thought and data went into setting the goal. After all, what you are aiming for is the best performance possible from yourself or someone else. Not a sorry wreck at the end of the exercise.

Figuring out current performance, comparing performance of others of similar ability, and figuring out what a realistic improvement could be, are all ingredients to a realistic goal. The answer you get might not be the nice round number you first thought of, but it is likely to produce better results. Yes, it will have taken a little longer to arrive at, but it will also encourage a higher level of commitment in whoever is doing the work.

I’m forever guilty of setting unrealistic goals with my running, whereas a little more thought might help motivate me, rather than demotivate me. The same goes for sales targets, marketing objectives, delivering projects, passing exams etc. etc. A touch more realism, and a touch less optimism, might produce much better results in all areas. True of all things in life really.

Thursday 9 September 2010

Fake Guinness Viral Advertisement

Did you see the fake Guinness viral ad? The one with the naked lady doing goodness alone knows what underneath a bottle of Guinness? If you haven’t, it’s too late, because Diageo have made YouTube remove it from their site. I’m not surprised.

Although it was free advertising for Guinness, it wasn’t at all consistent with the Guinness brand values. Whilst 50% of the population (that’s not the female half) I'm sure thought it hilarious, its overtly sexy and sexist content seemed more suited to a Castlemain 4X Aussie commercial - with all its sophisticated humour. The Guinness advertising has always been wholesome, intelligent and stylish. Consistently wholesome, intelligent and stylish: which is why Guinness is a valuable brand that Diageo rightly want to protect.

Great marketing is a good deal more than a fun idea and a camcorder – although at times it doesn’t look that way. That’s the real beauty in something as complex as a world-beating brand – when you get to see the finished result it looks like a 16 year old could have done it.

But they didn’t.

Wednesday 8 September 2010

Marketing results matter

Marketing results matter - good results and bad results - and are well worth studying. And here's why.

If you don’t pay attention to the results of your marketing, you are not listening to your prospective customers. They tell you, through their responses (positive, negative or indifferent), what is relevant to them and what is not. They tell you what is addressing their problems, and what is not. They tell you what they need, and what they don’t need. Powerful stuff.

History shows that companies who don’t listen to their market get results that match their attentiveness.

So pay attention to your marketing results – good, bad and indifferent.

Monday 6 September 2010

How to ensure good intentions are followed through

The road to hell is paved with good intentions.”

Most of our good intentions – whether carried through or not – don’t lead anywhere close to hell. They lead to emails never written, untidy desks or turning up late to appointments: minor things that are nothing more than an irritation to us and our colleagues. And then, for some reason, we get thoroughly fed up our unhelpful behaviour and resolve to change. But like Toad in Wind of the Willows our good intentions are genuine but short lived. We simply fail to follow up on answering all our emails/being punctual/tidy or whatever.

Change is a great deal more difficult to affect than we realise. Habits get ingrained and are not easy to change. That’s why so many New Year resolutions are made and religiously kept through the first couple of weeks of January then abandoned without another thought.

So how can we ensure that good intentions get followed through? In my eternal battles to conquer tidiness and clear my inbox, here are six of the best in making lasting change:

  1. Tackle one habit at a time. A list of resolutions isn’t really helpful to anything other than our ego. Start with the single habit that will make the most difference.
  2. Write down your goal and progress. When I was living without caffeine I had a spreadsheet that I logged each and every day I didn’t drink caffeine. It sounds a little over the top, but unless you have a reminder mechanism, you are unlikely to follow though.
  3. Tell other people what you are doing and enlist their help. Not just on day one, but a month or two into your change. Most of us don’t like to lose face in front of people we respect and so will work twice as hard to keep resolutions we’ve made public.
  4. Recognise it takes time to change. My experiments indicate that it takes at least 100 days to get a new habit established, and even then you can’t relax. You have to keep reminding yourself why the habit is important, and put the effort in to keep it going.
  5. Know why you are doing it. Any worthwhile change takes effort, so it’s important to understand how life will be better once you’ve established a new habit. Talk to other people to find out how they work – the more sure you are of yourself, the more likely you are to stick with it.
  6. Make a change that’s right for you. If you like to work late into the night, and start work late in the morning, you are unlikely to be successful in changing into an early riser. Figure out what you are trying to achieve, and then work within your preferences and abilities.
Human beings seem to be designed to strive and change things for the better. We are never quite satisfied with what we have, or how we work. But setting the same resolutions time after time is a soul destroying exercise – better to put more effort into what’s really important. Leave the long list of “wouldn’t it be nice if” resolutions until you've got the important ones licked.