What is the role of marketing in your company? How much involvement do you as CEO or business owner have in setting marketing strategy? Are you sure that the money you spend on marketing provides a strong ROI?
At mid-market companies, we have found it’s not uncommon to have the domain of marketing focused on managing the website, coordinating trade show participation, drafting press releases, creating the sales collateral, etc.
“Marketing is too important to be left to the marketing people.”David PackardFounder, HP
Of course these tasks are important. But is marketing truly elevated to the level where it can most effectively impact top line growth? What is the executive mindset with regard to marketing? While some marketing folks might wince at David Packard’s quote (see inset box) as a slight against the profession, the evolved ones welcome a CEO who embraces marketing as a key driver in the company’s success, beyond the promotional/marcom aspects.
These are the marketing execs who strive to present the CEO with a strong ROI [see “Measure and Adjust” section below for our approach to driving accountability of the marketing function].
“Business has only two functions — marketing and innovation.”Peter Drucker
Marketing can play an important role in all type of companies, be they sales-driven, technology-driven, or finance-driven. But what does it really mean to be market-driven and what are the advantages? Market-driven companies strategically select the market/segment(s) to focus on. They truly view the world from the perspective of the potential buyer in their selected target market, understanding their needs (including their unexpressed and future emerging needs).
What are the advantages? Research1 has shown that market-driven companies:
– are 31% more profitable
– bring new products to market twice as fast
– enjoy 10-20% higher customer satisfaction levels
Stanton Associates works with companies to build and benefit from a market-driven perspective, both at the strategic and tactical level. Excelling on one half of the equation, but not on the other will not allow you to reach your growth targets.
How We Help Mid-Size Companies Market
Stanton Associates works with companies in a variety of ways along the marketing spectrum. Depending on your needs, we can help you to ensure that a sound and compelling marketing strategy provides a foundation for success. We’ll determine to what extent a well thought-out and integrated marketing plan is in place to guide the efforts of the team and provide a structure of accountability. On the tactical end, we’ll perform a marketing audit to determine where the execution may be faltering. It’s not uncommon for us to roll up our sleeves and generate some of the needed elements of the marketing mix if necessary. And finally, we’ll want to understand if there’s a feedback loop in place to measure the effectiveness of the efforts, and then adjust the plan as necessary.
The Marketing Spectrum
I. The External / Internal Assessment
This is an important, elementary step to understand external factors: the customer, the competition, and trends that can impact either; and also the internal factors about the company itself. As the CEO you know a great deal. After all, it’s your own industry, your own company. However, companies that assume they know everything about the customer base and where the market is going run a big risk of getting it wrong. Or, they could be missing a big opportunity.
We usually perform secondary, and often primary, research to better understand the target audience and their needs. We discover how the market is segmented; how the needs differ by segment; who the decision makers and decision influencers are. Our goal is to understand how the world appears from the eyes of the customer.
It’s important to create or update an overview of the competitive landscape: the key players; their relative value propositions and positioning; which target market they serve; their pricing approach; and how they reach customers. The point is to understand the landscape and to come up with a game plan to beat the competition (as well as potential future competitors), and to change this analysis into a competitive advantage.
To understand the impact on future growth and what counteractions should be considered, we review trends in demographic changes, government regulations, technological changes, and industry forces such as consolidation, market expansion or contraction.
A good internal look at the company includes its products/services and organizational capabilities, its strengths and weaknesses, as well as internal opportunities and internal threats.
II.Develop the Right Strategy
A key element of marketing strategy is market definition, which is an area that we frequently find needs some fine-tuning or sometimes a complete overhaul. It involves articulating which market segments to actively pursue and ensuring the targeted segments are large enough to support their growth goals. We work with companies to approach this step from both a qualitative and quantitative manner.
In developing or evaluating the strategy, we consider the optimal Marketing Mix, also known as the 4 Ps. This involves determining strategies with regard to:
- What is the product (or service) strategy?
- How should the product look and function to meet the needs of the target audience?
Placement (or distribution)
- How do you get your product to the end user?
- Is it sold directly or through channel partners including resellers, distributors, integrators, etc.?
- Which channels are best aligned with your markets’ buying preferences?
- What is the pricing strategy and what are the components of the pricing approach?
- Are you pricing in terms of value to the customer, rather than in terms of costs?
- What is the optimal pricing strategy?
- What are the strategies, methods and messaging for reaching your decision makers? Decision influencers?
- Branding is important, but we focus on branding as it relates to selling more products/services.
- How can you best create a compelling value prop and unique selling proposition for your target customers?
III. Build an Integrated Marketing Plan
To transition from the strategic to the tactical, you have to consider what your objectives are. What are the company goals that marketing must support? We assist clients in building the marketing funnel, which depicts the process from contacts to leads through to the various stages of the sales process, all the way to closed deals.
The integrated plan must also show how the various marketing tactics and initiatives are employed to support the different marketing objectives of building awareness, generating leads, helping to close sales and fostering good customer service and other measures to drive repeat business.
- What are the key initiatives and key marketing processes to support this objective?
- What processes can be put in place to measure progress in this area?
- How many do you need? What’s the goal? (see marketing funnel)
- What steps are in place to generate and nurture leads?
- How do you ensure the leads are watered and cultivated, until they become a sales-ready lead and ready to be handed over to a sales team member?
- What marketing automation tools, including drip marketing applications and others will be used to support these efforts?
Support the Selling Process
- Is marketing providing sales tools that the sales team uses?
- Is the marketing material in sync with the stage of the buying process?
- See box on “Sales Toolkit”
Generate Repeat Business/Renewals
- What is marketing doing to drive repeat business? Either explicitly or by serving as watchdog over the customer service experience?
- What is marketing doing to ensure that the voice of the customer is captured and funneled back in as feedback for new product ideas, enhancements, etc.?
A few notes about the integrated plan
The plan must detail time, budget and responsibility specified for each item. In this increasingly complex world, companies are faced with a proliferation of customer segments, product lines, media outlets, channels, etc., all of which presents a daunting challenge to ensuring the marketing plan is integrated and consistent where it needs to be, and specific where it should be. Stanton Associates helps you to make sure your plan is up to this set of challenges.
IV. Execute the Plan
When it comes to converting the plan into action, you will benefit from the performance management methodology that we apply, not just to the development of the plan, but to the structures for monitoring and evaluating over time. Stanton Associates can also play a role in the execution of the plan, generating marketing deliverables, or if needed, connecting you with our extended team of marketing service providers.
The Sales Toolkit
Developing a robust toolkit for the sales team includes:
- General product FAQs
- Other marketing strategy documents, including compelling value proposition, positioning charts vis-a-vis your competitors
- Messaging guidelines
- Proof points
- Objection Handling Guide
- Pricing information, plan configurations, allowable discounts
- Completive overview, with “war books” on key competitors
- Referenceable accounts list
- Marketing collateral targeted by market segment, product line, etc.
- Information on upcoming promotional and other marketing activities
Forging Sales and Marketing Alignment
A critical factor to successful plan execution is ensuring alignment between sales and marketing. Unfortunately, in plenty of companies, sales and marketing act as two separate silos. A survey by the CMO Council shows less than 20% of respondents said that their sales and marketing groups were “extremely collaborative,” while most others felt that the two groups had “intermittent relations and interactions.”
Companies that are aligned to drive profitable growth have several key characteristics:
- Marketing captures insights gained by sales force on the front line with the customer.
- Marketing regularly communicates to the sales team insights gained across the organization.
- Sales is informed ahead of time of key marketing initiatives, and in some cases, their input is captured.
- Marketing understands the different stages of the customer buying process, and equips the sales team with content that is especially geared to a given stage.
- Marketing provides a “Sales Toolkit” containing numerous key items to support the sales process, these items are used by the sales force, and feedback is provided.
- There are structures in place to systematically support the elements above.
V. Measure and Adjust – with a Focus on Marketing ROI
Are you sure that the money you spend on marketing provides a strong ROI? This question was not commonly asked a decade ago. Now it is increasingly asked, but answers are not always available. Measuring effectiveness on digital marketing efforts is one thing, but many companies stop there.
We work with mid-market companies to measure the success of both digital elements as well traditional elements of the marketing mix. We build an organizational focus on Marketing Performance Measurement (MPM), which helps to drive better decision making. It’s part of our overall performance management methodology which asserts that “if you can’t measure it, you can’t manage it.”
Gathering the right analytics will vary by marketing element and from company to company. Some may be activity-based, some may be outcome-based, and some predictive of business outcomes. The key, which we help to determine for your company, is to focus on which metrics makes the most sense. We will help you to establish these, and then adjust strategies and actions accordingly, based on the information and insights gathered.
The Customer Feedback Loop for Innovation
Smart companies harness the power of the customer mindset for the benefit of ongoing innovation. This can take the form brief periodic surveys, information captured from customer care calls, customer summits, formal user groups, customer laboratories and other formats. It also includes capturing valuable feedback from former customers and prospects who declined to become customers. We have built these feedback systems for our companies as a key way to help shape not just the future of the product/service, but also to guide decisions around delivery of the product/service, effective marketing executions, pricing factors and other elements of the marketing mix.
The one caveat is to ensure you listen not only to customers’ current needs and requests, but also to make sure you understand the situation from their point of view. In this way, you will be better able to ferret out needs not yet articulated by the customers themselves, and so, come up with more compelling enhancements and breakthrough innovations.