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Foolish you. If you won't listen to "who's he to tell us" guys like me, at least take a hint from the famous Mr. Peter Drucker, who said, Business has only two functions -- marketing and innovation....
Still not convinced? Then check this out.
According to a just-published article in eMarketer entitled Convenience is more important than price, "Confounding the old image of price shoppers, a new report from the Grizzard Performance Group discovered that the majority of US shoppers today do not 'shop around.' In fact, according to the survey results, more than half of American consumers (62%) do not bother to compare prices at even two land stores before making most of their purchases."
Okay, they attribute this phenomenon to convenience. But then the article goes on to say, "However, the survey revealed that of those who researched and decided to purchase a particular product on the Internet, 64% would consider purchasing a competitive product if they received a direct response offer of 15% off a comparable brand."
Now, here's my spin.
Most of us aren't selling price, we are selling value, trust and credibility. In fact, research by the Harvard Business School indicates that selling price is a huge mistake when measured by profits. So unless we can sell volume, cutting margins is not smart.
So, providing coupons, running ads screaming "Save Big" and giving ourselves away for free is stupid. And even if we can afford to sell volume, 63% of our potential shoppers can be swayed by someone else's marketing. So what are you doing reading this when you should be marketing and building brand? And don't sell price, unless your prepared to abandon profits for a one-time sale at little to no margin.
Wait! Don't go yet!
Before you develop and launch that campaign, one final note: convenience is an element of experience. So before you begin luring customers to your products and services by making it easy for them to purchase from you, make sure you offer a great experience, if you want them to become returning customers.
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Comments
Lewis, as one from the field of marketing, who has seen its power in Fortune 500 companies, I think you're right on.
The tough part, however, is to get sr management to buy into the value of marketing.
I've read countless books on "how to get a seat" at the board-level table, read the Drucker quote (and passed it on a hundred times) and found just about every proof point that I can to tell/show sr. execs the value of marketing.
Problem is, I find few sr execs who believe it.
Need proof? What's one of the first line items to be cut when a downturn takes place...
So I believe, you believe, but we all don't believe. And that's a problem.
Lewis, you're a smart guy, and we have smart marketers in this forum. How do we "fix" that? An obvious answer is more measurement and accountability, but I'm not convinced that's the defining answer. Although it would help...
Posted by: Paul Barsch | 01.08.07
Paul,
I don't have the "one" right answer, but here is what I have done in the past to get senior ears to listen.
I volunteered myself and my department to write the senior executive speeches, and always slipped in some marketing successes. It's hard for them to ignore when it comes out of their mouths.
I also cut costs voluntarily and then always came in under budget. We were lean and focused on the interests of top management only. Until they began to trust us. And then we began the advice and consent approach.
Rather then trying to convince senior management of our importance, I worked from the bottom up. First step, I integrated our department with the other key departments within the corporation (e.g., retail, customer service, HR, creative), and helped them cut costs by creating a one-stop shop for internal brand communications, and took over the responsibility from the CFO of the Annual Report, and cut costs there as well. Funny thing about that last effort--we spent less but won more than a few awards for design and customer appeal.
Now, I couldn't have done any of this without the support of my senior exec, so obviously that was the starting point--making her look great in front of the CEO and the COO. The biggest skeptics? Those who reported to me. They were terrified of change and doing things differently. Mostly they got over it, or transferred to another department, and were not replaced by me unless I absolutely felt we couldn't get the work done without another body.
One final thing: we stopped doing anything that senior management doubted, and found ways to integrate those things, if necessary, within the work senior management respected. And we outsourced most of the external marketing, saving costs, and reduced much of the advertising budget to put the money on internal brand building and events (experiential marketing).
Warning: I was not the most popular person among my peers, but senior management thought we did great work and my peers saw the results in their pay increases.
Posted by: Lewis Green | 01.08.07
I'm a newspaper marketer. Love the business of newspapers and marketing. A couple comments, Lewis. First, I love the way you spin it. Value, trust and credibility - all interlinked and related back and forth. I'll work backward in a little soul baring. Ours is an industry built on credibility. It was only a few years ago (or maybe it was minutes) that journalists were busted right and left for making up news. The entire news business suffered. There goes credibility and trust. A harsh lesson and many wonder if hard news will ever recover. I happen to believe we are making steps toward these 2 key .
Now to value...we learned giving the paper away is bad - the hard way again. For years the industry has been audited by an agency ABC. They verify that someone is actually purchasing the product. When they discovered some major papers were claiming circulation gains based on inflated numbers - its a sordid story I won't go into.
Why do we do such foolish things? In a nutshell, for the short term gain. And as marketers, we fail. That's not to say that discounts are not extended to valued customers and advertisers. But give it away? No - there IS value in the product and the information. Call it a shameless plug but I encourage every one to buy a local newspaper - or at least read one today :)
Posted by: Bob Glaza | 01.08.07
Bob,
I an a former reporter (three + decades ago), and die little deaths every time the industry forgets that all it has to offer is honesty, trust and credibility. It is what newspapers sell, and without it newspapers are worthless sheets of inky paper.
I continue to read two newspapers a day plus CNN, AP and Reuters. But even this old newspaper guy now personally verifies everything he reads before repeating it.
The news industry is the mainstay of our nation's liberty, and it must survive its mistakes. Maintaining liberty is why our forefathers made Freedom of the Press part of the Bill of Rights, an after-thought to the Constitution, by the way.
And to regain credibility, it must think long-term and get its marketing strategies in order.
Posted by: Lewis Green | 01.08.07
Lewis, Paul, getting the whole 'marketing thing' is a personal choice.
I've spent 20 (or 200, I forget) years at some of the world's biggest brands, from Sony to General Motors to elsewhere and you either inherit guys who get it or you don't. The guys who get it will help you make the big strides in your career. The others wouldn't be convinced even if you drown them in scalable, ROI-positive test programs with raving customer testimonials and Time cover stories.
Why? Marketing is scary to non-marketers. We're a threat to the sales guy, a black magician to the CFO, and just frightening to the CEO.
My advice? Do your job well -- test, measure, scale, and then evangelize the benefits of doing the right thing to your channel partners and your sales/ops people. Maybe the "senior staff" will get it. If they don't, make your own decisions about whether you're in the right or wrong place.
Marcus Aurelius says, "today, I shall be meeting with interference, ingratitude, insolence, ill will and selfishness, all of which is due to the offender's ignorance of what is good or evil." Sounds like he had my old job.
Good luck!
Posted by: Stephen Denny | 01.08.07
I agree with you. Credibility and trust is a brand's most valuable asset.
Posted by: David Reich | 01.09.07
Thanks Stephen but I lean toward optimism and perseverance, so I could never accept the words of Marcus Aurelius who says, "today, I shall be meeting with interference, ingratitude, insolence, ill will and selfishness, all of which is due to the offender's ignorance of what is good or evil."
Additionally, I believe people want to learn and are open to ideas, even strategies and tactics they don't get. And I have been with some large organizations, as well. Mostly, my idealism pays off, with failures, large and small, sprinkled in.
David, keep up the good thoughts.
No fear. Never give up.
Posted by: Lewis Green | 01.09.07
Lewis:
I absolutely am a proponent (not to mention part of) marketing and its ongoing value. Currently, I am challenged in an environment that embraces the pendulum swing to user generated content (UGC) and communities as replacing marketing. My feelings are that UCG mandates the evolution of marketing in today's global economy and those who can adapt will see benefit. If I hear once more that MySpace never did any marketing, I may throw-up. They did marketing, just in non-traditional means that resonated with their targeted audience (of whom I am not). Before my rant gets full blown, I want to raise the purpose of my post...what are your thoughts on marketing value in an increasingly user-controlled environment? And what suggestions to have that be 'heard' in today's market?
Posted by: Dara Schulenberg | 01.12.07