marketing strategies for beginners, marketing strategies definition and principles
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marketing strategies for beginners, marketing strategies definition and principles

when I talk to marketing leaders the
subject of pricing almost always comes up they lose sleep wondering if their
prices are too high or too low it’s a constant ongoing challenge for every
marketer of the four PS of marketing product price place and promotion
setting prices is the quickest but that doesn’t mean it’s the easiest in fact
making a mistake here can be very costly in terms of lost revenue as well as
sending the wrong signal to the market about your products and services so how
do you overcome this challenge the key is to understand the role of pricing
then you need to understand the most common pitfalls companies make when
setting prices let’s start with some definitions to be successful at pricing
you need to understand the difference between a product’s cost its price and
its value the cost of the product is all the direct and indirect expenses that
you experience as the manufacturer to make the product things like raw
materials and labor for example price is what a consumer has to pay to acquire
the product a price is a signal a piece of information about what you might ask
about the value value is what the consumer gets out of the product the
collective set of benefits delivered by the product the most common mistake in
pricing is setting it based on your costs it may seem counterintuitive but
price is unrelated to cost your customer doesn’t care what it cost you to produce
the product they don’t compare your cost to what they pay instead they compare
what they pay versus the total value they get out of it if value exceeds the
price then they’ll buy the product but if not they’ll ignore it value-based
pricing then is the process of calculating the total delivered value
from using the product and then setting the price at or just below that amount
think of price as a shortcut the price quickly tells a customer a lot about the
quality and value hey but what about the competition in
their prices well first look at your value proposition if you’re positioning
your product as superior to the competition then you should set the
price higher than theirs if your product is equivalent to the competition make
the price the same and if your product is inferior to the competition set the
price lower that’s how price becomes a signal of
value when compared to a competitor now pricing can be a very touchy subject
because everyone in your company will have an opinion about it sales teams
tend to want lower prices because it makes their job easier finance teams
tend to want higher prices to cover the fixed costs they’re driven to meet
targets around profit margins but you as the marketing leader need to take a
customer centric view and not be unduly influenced by your colleagues and other
departments focus on value and see pricing as a way to help customers
understand what your products and services are truly worth hey people
don’t mind paying higher prices if they get high value in return
in my experience price is without a doubt one of the top 10 marketing
challenges for any business the trick is to balance financial impact with good
common sense about customers expectations perhaps the most important role of the
marketing leader is creating a competent team and for that reason alone it’s one
of the most challenging it’s a constant fight for talent hey you may have the
best products and services in the market but without a strong and talented
marketing team behind them you’ll start losing ground to the competition so
let’s look at ways to win this battle but before I start let me share an
insight you read a lot in the media about the generational aspects of
business and the many differences between Millennials Gen X and Baby
Boomers but guess what for my experience the same things that excite Millennials
are the same things that excite my generation so don’t get too caught up
with the demographic shifts so how do you attract and retain great marketing
talent it starts with great products and services backed by the reputation of a
global brand coca-cola Apple Amazon and so on but what do you do if you have a
wonderful reputation but no one’s ever heard of you here’s an example the
global fortune 500 company with over 50 unique and successful companies within
it if it’s going to win the fight for talent it has to raise its prominence in
the job market especially in business schools so you do that with promotional
efforts attending job fairs and having a great website about careers at your
company next look at how you communicate opportunities at your company what is it
that you’re stressing are you telling them how amazing they need to be or are
you telling how amazing it would be to work at your company now here’s why that
matters if you stress why they need to be super talented those who are super
talented already know it if you just reinforce that you’re looking for
superstars they’re likely to react by saying well duh
I know that so instead focus on why it’s amazing to be at your company promote
all the perks the cool spaces in your headquarters the types of challenging
work you do the value you bring to society overall that’s what really
matters to the superstars of all ages sure you need competitive pay
benefits but it’s the intangibles that matter so much in recruiting talent now
one area that I think is often overlooked in recruiting is telling the
candidate about how much autonomy they’ll have in their job if the message
comes across as will tell you what to do when to do it and how to do it hey
forget it marketers especially want some degree of
autonomy in their job and finally you need to assure potential candidates that
they’re joining an elite team thoroughbreds like to run with
thoroughbreds give candidates a strong sense that they’re joining a team of
people just as talented as they are that really gets their juices flowing but
that means you have to back it up a players want to be with other a players
if you’ve got a lot of B players good but not great you may be over promising
and if you have any C players who you haven’t cut yet these new recruits will
spot it right away that’s not good going out and getting the best talent you can
afford maybe your biggest marketing challenge of all if you do it
successfully you’re on a path to win in the marketplace there’s a constant tension between the
marketing organization and the sales organization hey believe me I’ve seen
shouting matches in the boardroom between marketing and sales leaders this
tension is a challenge and will never go away so it has to be understood and
managed or the organization will suffer hey and it takes a lot more than just
having a cup of coffee every so often with your counterpart now it’s not hard
to see why this tension exists the two organizations are vastly different in
terms of their role in the organization their structure and their ambitions they
have different perspectives of the market they have different processes and
they may have a different sense of urgency about what’s important but the
organizations have a tremendous amount of overlap and that’s where the friction
can occur for example the two groups can argue about things like the pricing of
your products which products to focus on which customers to go after and what
messages to put in the marketplace the codependence between the organization’s
creates a natural rivalry now some tension between sales and marketing is
healthy and productive the vers viewpoints lead to creativity and better
problem solving you need to harness those differences and turn them into a
benefit and sometimes you have to agree to disagree you can’t let the
relationship deteriorate or things will get worse after all you probably
disagree because you each have different assumptions you’re working with or
you’re using different criteria to evaluate a situation so here are some
ways you can keep that tension in check first you need to have role clarity
between the two organizations which things does sales do on its own what
tasks does marketing do and which tasks are done jointly for example I think
it’s critical that the two organizations jointly set goals and objectives that
they conduct joint planning sessions and that they create common definitions
about what is a customer and who is our competition this creates a good
foundation another great way to keep the relationship positive and productive
is to hold joint recognition events these events help build empathy and
respect for both sides and finally you want to create frameworks and processes
that require the two organizations to communicate and collaborate for example
look at your pricing processes product development and the ways you get
customer feedback put steps into these activities that require input from both
organizations this tension will never go away so expect it and manage it minimize
the downsides and distractions but take advantage of the positive sides be a
strong supportive leader who creates a culture of teamwork and cooperation hey
your customers will appreciate it creating a powerful brand is a great way
to build loyalty with their customers for many companies brands are the single
most valuable asset but once you’ve created a brand that’s
where the challenge is kick in and it can be a real headache if you don’t
manage brands correctly these challenges come from both inside your organization
as well as outside for example one of the most common problems marketing
leaders have with brands is what I call brand chaos it happens when new brands
start popping up almost out of nowhere and sadly they have no consistent look
or feel to your other brands and then one day you’re flipping through your
product catalog and you see a mishmash of products and brands that have nothing
to do with each other your brand architecture is in a state of anarchy
how does this happen well marketers love to create brands hey
it’s fun and exciting and they like creating ones that are distinctive and
unique let’s face it they want to put their mark on something so they get
together with their design team and branding agencies they throw a lot of
money creating the next big thing if left unchecked you’ll experience brand
chaos it’s expensive to fix and it can really confuse customers on what your
brand’s mean another common brand problem is when employees take one of
your brand marks and create their own adapted version of it in other words
they make it look different than the official version a sales rep might put
an altered brand mark in a presentation for example or a marketer might change
it slightly to fit on a package those sources of this problem are many rant
chaos can also stem from things outside the company if your competitors start
attacking your brand’s by D positioning them you have to fight back for example
a competitor might begin an advertising campaign telling consumers that the
benefits of your brand just aren’t that important this type of deep positioning
strategy can lower your brand equity another common problem is when some
company copies your bread and creates counterfeit products and
services hey consumers don’t know the difference so you leave as a sale each
time they buy a fake product with your brand on it so how do you deal with
these challenges well first you need to create a brand book just as the name
implies the brand book is the complete story of the brand and all the elements
that go into it it establishes strict guidelines on every aspect of how a
company’s brand will be managed this affects everything from how the logo can
be used the look of a website how social media is used advertising product design
and so on second you need to appoint a strong brand champion someone who is
senior enough in your organization to regulate and monitor brand compliance
and stop anyone who violates standards in the brand book and finally you need a
strong legal team either internal or external that will go after
counterfeiters or anyone that hijacks your brand’s for their own use great
branding is about making and keeping promises in a consistent way
that’s why great marketers do whatever they can to prevent brand chaos Marketing operates in a world of change
and ambiguity so you have to constantly monitor trends to spot opportunities and
avoid problems now depending on your market this could be one of your biggest
challenges you don’t want to be guilty of missing a key trend that puts your
company out of business trends and your business happen in many areas for
example consumer tastes can change Campbell’s soup for example is looking
at ways to change its legendary long-standing chicken soup recipe
because of perceived changes in consumer taste trends and technology are another
big source of risk and reward you can also be affected by trends in economic
conditions politics regulatory and legislative policies as well as trends
in foreign countries there’s a lot going on out there when I analyze trends I
like to sort them out this way first I decide whether the trend will have a big
impact or a small impact on my company then I assess whether the trend is fast
moving or slow moving when I say fast moving I mean it happens quickly over a
matter of days or months whereas slow moving trends might last 20 years or
more now I wouldn’t say that you should completely ignore low impact trends but
clearly you want to focus on the big ones those are the ones that will get
you in trouble if you ignore them trends that have a big impact and are
fast-moving need immediate attention so assign someone from your team to
study it and make recommendations try to avoid a quick knee-jerk reaction you
might make matters worse get alignment from your peers and your boss before
taking action you don’t want to be guilty of what we call in marketing /
driving your headlights now from my experience the ones that give me the
most concern are the big impact slow moving trends I call these the silent
killers there’s slow moving so there’s no sense
of urgency until BAM one day you’re staring at something that
you’ve known about for a long time but you’re way behind you’re
Pettit arisen dealing with it not good so how do you keep up with trends you
need to set up a way to monitor what’s going on out there or what I call
listening-posts for example you might want to hire a marketing research firm
to watch trends and tastes and attitudes also monitor social media channels to
hear the conversations that consumers are having about you and your
competitors one of my favorite techniques for dealing with trends is to
form an advisory panel of experts both from inside and outside the company
their advice can guide you when you need it most
how do you deal with trends once you spot them well you have to ask yourself
a critical question well I let this trend change what we’re doing or well I
go out and change what this trend is doing in other words you have to decide
if you’re a market taker or a market shaper in reality you’ll have to be a
little both you can change some but not all trends of course you need the
resources and skills to do that you need to decide where to focus to get the most
with the resources you have and avoid trying to change things you can’t for
those you’ll just need to adapt and survive great marketing leaders thrive
in a world of ambiguity and change trend-spotting is what helps them stay
on top a lot of my senior marketing colleagues
would come to me and complain about some of their new staff members they were
frustrated because these new marketers just couldn’t seem to get the right
perspective of the market and translate that back to their day to day actions
it’s a very common problem especially for less experienced marketers but it
can affect just about anyone like everything else we’ve discussed in this
course it’s a big challenge because you’ll miss critical insights if you
don’t have this skill I’ve put a name to this skill I call it zooming out and
zooming in zooming out is when you change your perspective to see the big
picture the whole market from a very wide angle zooming in is just the
opposite you zoom in to a new perspective right on the ground so to
speak very close to the customer and the buying journey think of it like the lens
on a camera the photographer sees a completely
different view of the subject when the lens is changed by zooming closer in or
by zooming far away changing the view triggers new insights on how best to
take that shot you can do the exact same thing
when trying to understand a market here’s an example imagine you work for a
pharmaceutical company and you want to introduce a drug that treats diabetes
into the Chinese market now China is a very big country with around 1.4 billion
people it’s almost 20% of the world’s population should be a great market
right so where do you start how do you get your drug from the plant in the US
to the people with diabetes in China from this perspective it seems
overwhelming so let’s change our perspective and see if it helps let’s
zoom down to let’s say one city in China like Shanghai now it’s a big modern city
with about 14 million people but for me that’s still too big let’s hoon down
again to a very small town in the middle of China with no more than say 50,000
people in fact let’s zoom into just one neighborhood
in that neighborhood let’s find one home with one person with diabetes let’s say
a man in his 50s got it now let’s ask ourselves the same question how do we
get one dose of our diabetes drug from the plan in the u.s. into this man’s
body now here’s why this helps if you can’t figure out all the things that
have to happen to get the product to just this one customer it’s hopeless to
consider how you would do it for all of China but if you do figure it out
you created a model that can be scaled up to other customers with this in mind
we’re going to zoom out and imagine other homes in this neighborhood then
zoom out to other neighborhoods then to other towns around the region and so on
before long you’re back at the level of the entire country to see the big
picture with each change in perspective I get the insights I need to create a
successful marketing campaign so look at your markets and train your eye to see
new perspectives zoom in and zoom out to find new ways to grow a company that retains a high percentage
of its customers must be doing a lot of things right
that’s why retention rate is the best indicator of a company’s long term
viability but keeping customers can be very challenging to succeed you need to
understand how and why your customers buy your products in marketing we do
that by defining four types of purchasing styles the first one is what
we call brand laziness that’s when customers want to exert the
minimal buying effort they don’t want to be bogged down with a lot of information
they just want to buy something now consumers use this style with old
familiar products and services that have worked well in the past so they buy them
out of habit without even thinking about it
they have no commitment to the brand think about for example how you buy
flour this approach is highly efficient for low-risk
simple products because it saves time and effort now the key here is to be
careful not to disrupt anything about your customers purchase flow if you
change the Shelf location the packaging or anything that makes them have to
think about too much about the purchase you may lose them to another brand next
is brand loyalty truly brand loyal customers are highly involved with the
bread they’ve had a good experience with it and they know a lot about it instead
of buying it out of habit they buy it because they’re emotionally attached to
it the key here is to continue to deliver high levels of quality and
service consistency is the name of the game if you let them down they start
drifting away next are the variety seekers people who shop for new
alternatives over more familiar ones varieties seeking is the opposite of
brand loyalty consumers use this style because they have yet to fall in love
with a particular brand try to get your customers out of the style as quickly as
possible otherwise they’ll keep switching back and forth between you and
the competing brands try to lock them in with free trials follow-up service
or discounts or perhaps a loyalty program and finally our the problem
solvers as the name implies consumers use this style when dealing with complex
products involving a lot of risk and uncertainty they need to be highly
involved and they need to gather a lot of information especially if the product
or service is expensive or purchased and frequently think about buying a car for
example or shopping for a plastic surgeon it takes time and information to
make a good decision and that was a marketer you have to help customers when
they’re using this style first provide as much information about the product as
you can make sure it’s where people can find it in your stores or online or
perhaps with their salespeople and show comparisons between your product and the
competition loyalty drives high retention rates the best marketers are
those that understand each type of loyalty so they can continue to give
their customers exactly what they want you

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