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Marketing Innovation
The term marketing was coined over 50 year ago and yet one form
or another of marketing has been around since the beginning
of time. But, these days marketing doesn't seem to be working
as well as it has in the past. What's the problem? Is the basic
marketing model flawed or is something else going on? The truth
is that marketing is a little more complicated today, than in
previous years. Marketers are also caught in the middle of corporate
decision-making about how to increase sales and profits and
how to cut costs and that has caused them to buy into a number
of flawed or simplistic ideas about their marketing programs.
Today, more than any other time in the past, you need to define
how you're going to be distinctive—in marketing that is
called branding. For example, the standard marketing model believes
that if you shovel enough prospects into the top of the sales
funnel and then use mass marketing you can reach a whole lot
of people cheaply and simply and therefore you'll get enough
business and be profitable. But that's not happening today because
of strong competition and look alike offerings. Today, some
prospects are lost because key elements of product offerings
are lacking. Many are lost when their decision-making process
gets down to things like price or timing. Still other prospects
are increasingly sceptical about corporations, which lessens
brand preference. Add to that information overload and it means
marketing has become less relevant.
What
is Marketing?
Today marketing has swung around to support selling instead
of the other way around. Marketing today often starts with
"what do we want to sell" instead of addressing
"who is the customer and what does he want." It
is aimed at getting people to buy things that the company
wants to make when it should be aiming at "how can I
make things the customer wants to buy?" In addition,
there is the problem of companies separating their sales from
their marketing efforts. Marketing is really the planning
function that drives all the other tactics you use in your
business. Think of marketing as the umbrella, sales as the
handle, and the spokes (public relations, direct mail, advertising,
sales promotion, and research) as the individual tools you
can use to make your marketing plan work. All of these elements
are what makes the umbrella and your marketing plan work.
So a real flaw with today's marketing is continuing to do
things the way we have always done them or believing that
one piece of the plan is more important than another. We are
taking away the relevance and personal aspects of marketing.
For
years I have asked my clients' one question about their marketing,
"Why." Why do you do that? Why do you do it that
way? Why does that help the customer? The idea is to understand
not only why we do things the way we do them but to further
ask questions about our results. "What are the results
we get from the way we do it?" If we are not customer
oriented then we won't be successful. And success means more
customers, higher sales and higher profits.
A
Case for Innovative Marketing
I hear it from executives all the time. "I don't have
time to sit down and be creative, I'm too busy putting out
fires and getting the day to day work done." Every company
has to increase revenues, keep costs low, be profitable and
be innovative or they won't succeed. Think about the fact
that you can't grow revenue by selling the same old thing
to the same old market in the same old way. You need to change
the way you are marketing. Many industries are facing highly
challenging times and are finding new ways to approach their
marketing. Kohl's department store came up with a radical
idea---make it easy for the customer to shop. R. Lawrence
Montgomery, CEO of Kohl's says, "Our whole philosophy
is to get shoppers to spend less time in our stores and buy
more." They did that by laying out their stores differently
than other stores. This is a simple, innovative and inexpensive
marketing strategy.
In
the suffering airline industry, Southwest Airlines has remained
a leader. The often considered radical airline keeps its jets
in the air for two or three hours longer than most of the
other airlines because it has adopted a point-to-point routing
system versus the hub-and-spoke model. Southwest does this
to use its capital more efficiently while serving price-minded
customers who want to go from place to place in a relatively
short time, by frequently offering flights without much service.
Southwest has been extremely aggressive about assimilating
every new idea possible. Today, it does many things differently
than it did 30 years ago -- but it's still serving essentially
the same customers who have essentially the same needs.
The
Ontario Government runs Showcase Ontario each year to celebrate
the power of information technology to transform the public
service. In an effort to increase attendance, the marketing
team changed how they communicated with their prospects by
becoming more tech-savvy. With a new strategic marketing e-mail
campaign they increased attendance by 25% and were delighted
when vendors rebooked 25 per cent of the exhibit space for
next years event, before the Showcase ended.
Making
your marketing innovative takes planning but most of all it
takes commitment. And it has to be personal and relevant to
the customer. You have to develop something new, useful and
value packed. And yet if you unlock innovation there is no
limit to the potential of what you can create. All it takes
is looking at your world in a slightly different way, knowing
where you are headed and making the change.
To
get an outside expert's opinion on your current marketing
programs, or to establish a new more vital program, contact
Linda at LLH Enterprises at 972-239-6020 or 416-239-6103.
Superior
Performers
What
does it take for a company to have superior performance? According
to Michael Porter you need a solid strategy to attain superior
performance, while Tom Peters believes you need to Re-imagine
your business. Still hammering at us that processes drive performance
improvement is Michael Hammer. Pick up any business book and
you will find the same startling fact: no author agrees on what
builds superior performance but many companies are trying new
ways to market and do business. As I go out and talk to superior
performing companies (for an upcoming White Paper) I find all
the businesses I talk to are innovative--they are systematically,
radically innovating all-the-time, everywhere throughout the
company. Like the companies mentioned in my article on Marketing
Innovation, they are in pursuit of something better in all areas
of their company.
I
would like to hear from you because as senior level business
people you are at the leading edge of what is going on in
business today. Please send me your ideas about how you or
companies you know are innovating and moving forward. Or recommend
some companies you would like to see featured in this column.
Better still call me at 416-239-6103 or 972-239-6020.
Cross
Border News
-
U.S. Jobless Rate Down
While U.S. employers added 21,000 jobs (below forecast) and the jobless rate was unchanged at 5.6% in February which drove the U.S. dollar lower, the Canadian dollar surged and the euro rose; but economists continue to debate how the U.S. economy can be growing rapidly and yet generating so few jobs.
- Small
Businesses Are On The Rise Around the World
Right now millions of people are planning to start a small
business and become one of the many small business owners
around the world. A recent study by the Kauffman Foundation
reveals America's unique strength and ability to overcome
obstacles has not dampened the increase in entrepreneurship.
And, in Canada home-based entrepreneurs reached 500,000
nationwide, according to Statistics Canada. While the Kauffman
study did indicate that global entrepreneur activity plunged
25 percent last year it showed that American entrepreneurship
plunged less than 10 percent. Couple that with a Wall Street
Journal/NBC News poll in 2002 that found that 91 percent
of Americans express confidence in small business, nearly
twice the level of support for big corporations, and you
begin to see the strength small business is gaining. In
addition, the National Commission on Entrepreneurship in
the U.S. reports that more people are employed by small
businesses today than at any time on history. What this
means is that small business is the driving force in creating
new jobs, supporting their workers, and improving the economy
around the world.
Performance
Notes
Middle-management making comeback—"Middle managers
absorbed a whole lot of the shock of downsizing," says
Terry Mitchell, a professor of management and organization at
the University Of Washington School Of Business. But long term
labor forecasts predict a growing demand for middle managers.
Their evolving role, however, is a dramatic shift from the 1980's.
Where will these middle managers be found? The U.S. Bureau of
Labor Statistics' overall projection is for slow, steady growth
through 2010, with some industries offering a better prospect
than others. The study shows that the largest projected growth
will be in general business and operations, finance, computer/high-tech,
advertising/marketing/sales and health care. This means opportunities
for current employees. But will companies be ready to move people
into middle-management positions? And, what will the new middle-manager
job entail?
E-mail
policies often overlooked—A study by the Columbus,
Ohio-based American Management Association and ePolicy Institute
indicated that only three out of every 10 firms have policies
about saving and deleting old e-mails and that fewer than
two out of every 10 companies monitor messages between employees.
The stakes are very high for employers with regard to harassment-related
lawsuits when communication between employees isn't being
sufficiently monitored. In addition, e-mail policies with
respect to client activities are essential in today's fast
moving business environment.
Top
ten reasons businesses fail—Borrowing from TV's David
Letterman, I also have a top ten list. Mine is based on the
reasons why businesses fail. I am happy to have been associated
with many small businesses that have been successful but I
have watched others decline or struggle needlessly. My list
is based on 22 years working mainly with small businesses
and divisions of larger corporations. Here are the reasons
I see most often for why businesses fail:
1.
Poor marketing strategy and planning.
2. Lack of vision and purpose by principals.
3. Lack of management systems, such as financial controls.
4. Lack of financial planning and review.
5. Over-dependence on specific individuals in the business.
6. Failure to establish or communicate company goals.
7. Lack of market knowledge and competitive awareness.
8. Under-capitalization.
9. Lack of innovation.
10. Accepting mediocrity.
Linda
in Print
The
following publications have sought Linda's expertise over
the past two months:
If
you would like Linda to write an article for your in-house
publication, email lhanson@llhenterprises.com.
Please
give us feedback on this issue of The Superior Performance
Report (click
here) and let us hear your insights and what you would
like to hear about next time.
Copyright
2003 by LLH Enterprises-reproduction for publication is encouraged,
with the following attribution: From "The Superior Performance
Report," by Linda Hanson, CMC, www.llhenterprises.com.
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