Marketing is simplistically defined as ‘putting the right product in the right place, at the right price, at the right time.’ Though this sounds like an easy enough proposition, a lot of hard work and research needs to go into setting this simple definition up. And if even one element is off the mark, a promising product or service can fail completely and end up costing the company substantially.
The use of a marketing mix is an excellent way to help ensure that ‘putting the right product in the right place…’ will happen. The marketing mix is a crucial tool to help understand what the product or service can offer and how to plan for a successful product offering. The marketing mix is most commonly executed through the 4 P’s of marketing: Price, Product, Promotion, and Place.
These have been extensively added to and expanded through additional P’s (e.g.People, Process, Physical Environment – and even Police in certain countries). Historically, the 4Ps provided a crucial framework for marketers, but in our modern era, the proliferation of devices, channels and change of consumer needs demand that we update this established thinking.
The 4Ps are used when referring to a business’s point of view, instead of the customer’s point of view. There is another part to the marketing mix called the 4Cs. Marketers use the 4Cs in the marketing mix to market in a more customer-centric way, rather than looking at how each aspect of marketing is seen by a business. Each C correlates with one of the P’s. The 4Cs areconsumer, cost, convenience, and communication (Kotler & Armstrong, 2014). The picture below demonstrates a customer-centric view and the correlation, or replacement, of each P with a C.
Consumer wants and needs (vs. Products)
You can’t develop products and then try to sell them to a mass market. You have to study consumer wants and needs (especially their implicit needs) and then attract consumers one by one with something each one wants. Author of the movie Field of Dreams, J.P. Cancilla may have exclusive rights to the phrase “build it and they will come”. In most cases, you have to find out what people want and then “build” it for them, their way.
Cost to satisfy (vs. Price)
You have to realize that price – measured in dollars – is one part of the cost to satisfy. If you sell hamburgers, for example, you have to consider the cost of driving to your restaurant, the cost of conscience of eating meat, etc. One of the most difficult places to be in the business world is the retailer selling at the lowest price. If you rely strictly on price to compete you are vulnerable to competition – in the long term.
Convenience to buy (vs. Place)
You must think of convenience to buy instead of place. You have to know how each subset of the market prefers to buy – on the Internet, from a catalogue, on the phone, using credit cards, etc. Lands End, Amazon and Dell are just a few businesses who do very well over the Internet.
Communication (vs. Promotion)
You have to consider the communication instead of promotion. Promotion is manipulative (ouch!) – it’s from the seller. Communication requires a give and take between the buyer and seller (that’s nicer). Be creative and you can make any advertising “interactive”. Use phone numbers, your web site address, etc. to help here. And listen to your customers when they are “with” you.
Developing a brand takes into account all the above considerations. Developing a brand is developing a promise. When you take into consideration the “4 C’s” noted above you begin the process of developing a customer-centric brand, but it should not stop here. That’s why I think the below 4Is are important to build a winning and enduring brand.
1. Identity
If you’re a photographer and someone mentions GoPro, you think of a super-sturdy camera for the adventurous. Why is that? Because GoPro has done a good job defining their brand.
In the battle for brand recognition, can your customers draw your brand’s logo from memory? It’s probably unlikely: UCLA professor Alan Castel and colleagues Adam Blake and Meenely Nazarian asked more than 100 students to draw the Apple logo from memory. The result? While most of the students were confident they could do it–the majority of them were iPhone and Apple computer users–only one person drew it correctly. Only seven people drew the Apple logo with three or fewer errors.
Not remembering a brand logo is no big deal, but if your target consumers do not know what your company represents, then you have a lot of issues that need to be fixed. Please remember It’s Not What You Sell, It’s What You Stand For. “The goal is to make your brand irreplaceable, and you do that with emotional connectivity: mystery, sensuality and intimacy,” says Roberts, author of Lovemarks: The Future Beyond Brands. “You want loyalty beyond reason and loyalty beyond recession. For small-business owners, this is even more vital because they don’t have the purchasing power that large corporations do.”
An epic example of brand longevity is Coca-Cola. The company has fulfilled its promise of lighthearted fun for 129 years—with its bottle shape, logo and flavor remaining recognizable for nearly all of that time. Yet this branding powerhouse is constantly inventing new products, most recently Coke Zero with new types of artificial sweeteners, and Diet Coke Plus with vitamin additives.
Innovation is not relegated to product alone, but target markets as well. In 1935 Coca-Cola went Kosher to attract Jewish customers, and today the beverage is being peddled in developing countries that have booming populations with growing disposable incomes, like India and China. Such moves are expected to position the corporation to gross an astonishing $200 billion by 2020.
“Everyone sells pretty much the same thing. The ones that stand for something survive.”
The brand is so successful, so ubiquitous, that few realize that the logo and graphics are in fact gently tweaked every three or four years to help retain a significant market edge over competitor Pepsi Co., which has had some of the most innovative advertising and product advancements in consumer products.
Coca-Cola has combined the past, present and future in a brilliant way, and they’ve approached advertising and packaging in a way that it is always happy, always sociable, and always part of the local community.
Here, I want to share with you one Coca-Cola campaign I like very much – also a good example about Marketing 3.0. Companies that conduct themselves ecologically and create real value that aligns with the social good will be competitively favored. The new media will increasingly carry more favorable statements about “caring” companies” and this will influence the buying choices of more consumers.
2. Integration
Integrated Marketing Communications (IMC) is more important than ever!
IMC plays an integral role in communicating brand message to a larger audience. It considers all points of contact your brand has online and offline. The point of IMC is to make sure that every piece of marketing is paid attention to. If every piece is in harmony, the overall result is much more powerful and the audience will be able to hear what your brand is trying to say. Each piece, no matter how small, shares the same responsibility in providing a strong brand identity.
Today, marketers have more choices than ever regarding how and where to promote or advertise products and services. Have you tried any creative and innovative way to engage with your target consumers? How do you develop a successful marketing campaign in today’s multichannel, mobile, social-media-driven world?
A new revolution has taken place when the adoption of smartphone took off and connectivity is now everything. For the first time, visual sharing platforms like Instagram, Pinterest and Facebook are allowing customers to play a critical role in defining brand experience and identity. While the voice of the customer has always been one of the most powerful concepts in marketing, it was typically text driven and dictated or heavily moderated by brands. Now that has changed. Customers have the power to visually define brands, amplifying their experience and influencing their peers, all with a simple photo or video share.
For brands, there’s an added bonus to this behavior shift in consumers. Historically, marketing teams have had to rely on surveys, focus groups and projection models to understand their customers. In this new age of Big Data and mobile, the amount of customer information available to brands has exploded. Each post, picture, and video comes packed with metadata about the post and the user. This includes captions, hashtags, @tags, location data, demographic data and more. Brands can use this data to inform their marketing in a way that makes a real difference to their customers. They can celebrate die-hard fans and highlight evangelists, connecting with the buyers on a whole new level.
With Instagram, I can post a training photo and 10 minutes later have Nike wish me luck on my next race. Does that make me feel closer to Nike? You bet it does. Not only do I feel connected, but Nike now understands more about me as a brand advocate.
In the same way that Twitter changed the news world, this visual revolution is changing the balance of power between people and brands. Smart brandsknow better than to fight the explosion of brand-attributed photos and videos. The most successful brands will evolve to take advantage of this behavior and use it in their favor. The very best will use it to convert customers into brand champions who love their brand even more than they love their products.
3. Innovation
Business needs to innovate to remain relevant and competitive. But how?
Below are some of the ways to anchor your brand’s innovation – some more obvious and traditional; and, potentially seen as low hanging fruit. The best and most sustainable results are achieved when a business has two or more is a complementing highly competitive capabilities on which to focus innovation. Plus, marketing excellence is the constant condition sine qua non.
1. Product Innovation
An area given most attention by brands – naturally, without a product that can be sold there is no future for any business – but it is also the least effective form of innovation in itself.
The reasons are obvious: it is usually expensive to create new, innovative products; it is expensive to launch and market; they are the easiest thing to copy or imitate; and then, the process can never stop. We have to constantly innovate product offerings and recognize and capitalize on new opportunities for product innovation.
2. Brand Innovation
Businesses that are able to create a strong presence or reputation, have an extra advantage of a ‘halo’ effect for their products and services. They still need to evolve, improve and delight, but the pull created by a brand makes selling easier, cheaper and more profitable.
Branding is not reserved for large companies with big advertising budgets, but it requires effort to create and maintain the level of noise.
- Price Innovation
Pricing is an art – one shade lighter or darker can make a difference between a painting and a masterpiece. There is only one way to price anything: Value-pricing. Value is perceived in high or low price. Everything in the middle is doomed to comparisons and commoditization.
High value: high price. This is possible when there is scarcity; common in fashion and differentiated services. Create scarcity with value.
High value: competitive price. This is the future for success in emerging large global markets; a design driven strategy and innovation approach.
Design everything for price: product, processes, networks, channels, culture (seeCultural Innovation)!
4. Cost Innovation
Keeping costs low to be more profitable is critical to business success, especially for businesses wanting to take advantage of large emerging markets.
The effective approach to cost innovation is through innovative strategic cost-based design that solves customer and business problems by creating value. Cutting cost by eliminating features or cheaper substitutions lowers value and can destroy the brand. Think of Qantas, an Australia airline formerly famous for safety and quality, irreparably damaged the brand by cutting costs where it hurt.
5. Marketing Innovation
Marketing – even if we take Price and Product out of the mix [remember? 4Ps of Marketing: Product, Price, Place, Promotion] – offers several opportunities for innovation. The biggest challenge for brands is that marketing has become fragmented and the boundaries of responsibility have become silo’d and ‘blurred’ between product, advertising, distribution and even internal communication.
Marketing innovation like Brand Innovation above is about building culture and an environment that attracts loyalty of customers and staff. There are activities to make a difference through marketing innovation: embracing technology to own new communication channels to connect with customers; creating brand evangelists (this starts in house); creating purposeful networks that help get and act on market insights before anyone else.
6. Platform Innovation
Having a unique platform is one of the strongest sources of a competitive advantage. Think: Amazon – conquered Sony’s superior e-reader because of its unique online platform; Apple – oops, Sony again – destroyed Sony Walkman and changed the music industry with iTunes.
Platforms may include an operating system (Microsoft Windows), software others can use creatively (Salesforce CRM) or a unique and relevant database. Platform can be anything that allows business to leverage other people’s products and services.
What platform(s) do you have or are you using?
7. Hybridized Market Re-positioning
“Nothing’s new under the sun.” science has now analyzed all existing matter into countless, smallest elements. What’s left and is hidden in plain sight? Synthesis! Innovation happens at intersections. Borrowing from your competitors is fraught with risk. It is illegal and at best makes you an imitator. However, you can steal from different industries. Picasso once said, “good artists borrow, great artists steal”.
Great opportunities exist in putting known elements in new combinations to solve unmet needs and anticipate customers’ wants. Cirque du Soleil has re-engineered circus experience, creating a whole new market of circus-goers. Andre Rieu re-positioned classical music experience and filled stadiums with people who never listen to classical music.
The final two points are the most powerful ways to innovate: a system that is highly relevant to the market, very hard to imitate and can be replicated in new markets.
8. Cultural Innovation
Whether you are a small business, or a mid to large company on an M&A path, it is equally important to develop behaviors and truly strategic values in which you and your current and future employees will deeply believe and therefore, will be able to follow without having to create a web of rigid rules.
A growing number of successful organizations start or embark on culture creation because they know that in the fast changing environment a manager’s role and best use of their time is to create value and connect people and ideas, rather than manage people’s tasks and controlling processes.
Establishing a self-driven, self-correcting culture around a clear Vision and Mission and a simple and flexible decision-making system that provides people with ‘freedom within framework’ is the way to innovate with impact.
9. Business Model Innovation
This is the strongest form of executing a competitive strategy. Here a business is able to combine several competitive elements from the above approaches and together create an impossible to imitate market advantage. This is a recipe for perpetual success.
Similar to Cultural Innovation, business model development is a growing trend among leading companies. The exceptional companies that have already proven their value, adopt a system to help them focus their strategy, identify elements of competitive advantage and create simple communication tools for leaders to drive the strategic message. This approach enables them to connect silos and implement strategic ideas faster, cheaper and more often.
4. Never Stop Improving
I would appreciate hearing your thoughts. Thanks.
Areteon Consulting Services 