Most people believe that marketing is only for big businesses and worldwide corporations, like McDonald’s and Starbucks, but this belief is wrong. Even the smallest business needs a marketing department – even if that department consists of only one person.
Why Do You Need a Marketing Department? What Do They Do?
Get New Clients
Obviously one of the main functions of the marketing department is to acquire new clients. Depending on your service or product, this can be done many different ways, such as cold-calling, advertising on a bus bench, radio, a hot air balloon, or any other number creative marketing vehicles. It is up to the marketing department to figure out which is the best for the business.
Their job is to figure out what is the most cost effective and highest impact method to introduce your product or service to people who have never heard of you. Without a marketing department, the only people who will buy your product are your mother, who loves you and your best friend, who is tired of listening to you talk about it.
Remind Existing Clients That You Exist
It is the marketing department’s job to keep reminding existing clients that you are still around. If you provide a good product then existing clients are easy to coax – you just need to keep reminding them. The next time they need something, your company will be the first thing on their mind.
Promote the Image
As a business owner, it is difficult to worry about what your logo looks like, what your invoice looks like, what the signature in all emails looks like, what your clients think of your company, etc. All these types of things seem petty and small – but they are just as important as the product itself.
You have probably heard it before – image is everything. It is true. Lady Gaga sings well, but it is her marketing department and the image they created that does all the selling.
Your marketing department should ensure that your business creates the proper image – right from the beginning. Things like having a nice logo, the logo appearing on all company paperwork and emails, guidelines for communication with clients, how complaints are handled… basically everything that your clients comes in contact with should be approved by the marketing department.
It is the marketing department’s job to ensure that your clients see your business and product in a way that promotes a positive image.
Are We Big Enough to Need a Marketing Department?
The “right answer” is in fact two more questions: what do we want to achieve and how quickly do we want to see results?
The size of the in-house marketing department has very little bearing on the success of the company marketing initiatives. Each company is prepared to examine its needs and wants and whether it is willing to put in place the right resources to get results.
In hiring their first marketing person, most companies staff for what they currently do. Someone’s got to organize the golf tournament and the client holiday party and order the pens. You end up with a mismatch of assorted helpers and service providers, none of whom has any direction about what the company is trying to achieve—because the company doesn’t know.
When you know what you’re aiming for, you can decide what help you need to get there. Start with your client list: who are your top 25 clients? What industries are they in? What’s in their future? An exercise like this can produce surprising results.
The key marketing appointment is the leader of the company’s marketing initiatives. The essentials for a marketing leader are to have a keen understanding of their clients’ needs, the company’s strengths, and a drive to make the company successful.
We’re all marketers now
For the past decade, marketers have been adjusting to a new era of deep customer engagement. They’ve tacked on new functions, such as social-media management; altered processes to better integrate advertising campaigns online, on television, and in print; and added staff with Web expertise to manage the explosion of digital customer data. To truly engage customers for whom “push” advertising is increasingly irrelevant, companies must do more outside the confines of the traditional marketing organization. At the end of the day, customers no longer separate marketing from the service—it is the service. In the era of engagement, marketing is the company.
Companies of all stripes must not only recognize that everyone is responsible for marketing but also impose accountability by establishing a new set of relationships between the function and the rest of the organization. In essence, companies need to become marketing vehicles, and the marketing organization itself needs to become the customer-engagement engine, responsible for establishing priorities and stimulating dialogue throughout the enterprise as it seeks to design, build, operate, and renew cutting-edge customer-engagement approaches.
As that transformation happens, the marketing organization will look different: there will be a greater distribution of existing marketing tasks to other functions; more councils and informal alliances that coordinate marketing activities across the company; deeper partnerships with external vendors, customers, and perhaps even competitors; and a bigger role for data-driven customer insights.
We went from a monologue to a dialogue. Mass media will continue to play a role. But its role has changed. Over the past two years, that evolution has only accelerated. More and more consumers are using digital video recorders to fast-forward through TV commercials and are consuming video content on Web sites such as YouTube and on mobile devices. Billboards alongside train lines and bus routes struggle to capture the attention of people absorbed by the screens of their smartphones. Meanwhile, today’s more empowered, critical, demanding, and price-sensitive customers are turning in ever-growing numbers to social networks, blogs, online review forums, and other channels to quench their thirst for objective advice about products and to identify brands that seem to care about forming relationships with them. Individuals even are posting their own commercials on YouTube. In short, the avenues (or touch points) customers use to interact with companies have continued to multiply.
The problem for many companies is that the very things that make push marketing effective—tight, relatively centralized operational control over a well-defined set of channels and touch points—hold it back in the era of engagement. Many touch points, such as calls to customer service centers and interactions between the sales force and customers, sit outside the traditional marketing organization, which has little or no permission to reach into other business functions or units. Companies have traditionally divided responsibility for touch points among functions.
Designing a great customer-engagement strategy and experience depends on understanding exactly how people interact with a company throughout their decision journey. That interaction could be with the product itself or with service, marketing, sales, public relations, or any other element of the business.
“At the end of the day,” says Virgin Atlantic Airways chief executive Steve Ridgway, “we fly exactly the same planes as everybody else. If we get our customers off the plane happy, and they go on to talk about that and get others to come and then come back again themselves—that’s a huge marketing tool.”
Once a company designs how it will engage with customers, it needs the organizational capabilities to deliver: adding staff, building a social-media network infrastructure, retooling customer care operations, or altering reporting structures. Functions far removed from marketing often have important roles to play, so one or more marketing teams at the center may have to build skills in other parts of a company.
A global energy company took that approach and then largely dissolved the group when those capabilities were in place.
Last year, LVMH Moët Hennessy–Louis Vuitton, for example, launched an online magazine, NOWNESS, that offers what the company calls “information reference” about its luxury brands. The site presents a daily multimedia story with little pure advertising and (in conjunction with LVMH’s efforts on Facebook, Twitter, and YouTube) seeks to deepen the engagement customers have with the company’s brands. British luxury brand Burberry has undertaken a similar venture with its Art of the Trench site. France’s Chanel has for years used its own creative and artistic directors to develop content, without any need for help from external agencies.
Content-oriented strategies like these require creative employees who can feed the customer’s ever-increasing need for timely, relevant, and compelling content across a variety of media. They also provide an opportunity for productive dialogue within companies about the role of marketing versus other functions in building critical touch points that drive engagement.
Companies also need a clear approach for monitoring touch points and renewing them as needed. At one major hotel chain, for example, a single group circumnavigates the globe acting as a “monitor and fix” SWAT team. It meets with hotel licensees, educates them about the company’s customer-engagement approach and management of key touch points, demonstrates new behavior, and trains the staff in new operational processes. Given the speed of information sharing today, constant monitoring and adaptation—indeed, continuous improvement of the sort that came to the operations world long ago—is bound to infiltrate marketing and grow in importance.
The marketing organization’s new look
As marketing becomes more pervasive, the marketing organization will increasingly be defined by a core set of tightly held responsibilities, such as branding and agency relationships, and a set of responsibilities distributed among the functions and groups best placed to manage and use the information generated by customer interactions. Procter & Gamble, for instance, has created a group within the purchasing function to buy digital-media advertising space. The group spans geographic boundaries, reflecting the global nature of the medium, and while it sits within purchasing, it is staffed by people with marketing experience.
While leading companies have long used marketing councils to boost management coordination, the new marketing organization will require many more of them, with greater representation from other functions. One global financial institution, for example, has created a digital-governance council with representatives from all customer-facing business units. The company’s goal was to ensure that data and analytics are shared, that customers receive the same experience regardless of channel (such as Web sites, branches, call centers, or automated teller machines), and that IT systems meet the customer’s digital-engagement needs.
More robust formal and informal external partnerships will be critical too. Customer forums, such as the one Virgin Atlantic Airways used to create a taxi-sharing app for smartphones, are one example. More structured relationships with distribution partners also can enhance engagement.
Generating rich customer insights, always central to effective marketing efforts, is more challenging and important in today’s environment. Companies must listen constantly to consumers across all touch points, analyze and deduce patterns from their behavior, and respond quickly to signs of changing needs.
One implication is that the types of talent required to derive such insights will change. A premium will be placed on problem-solving and strategic-marketing skills, rather than on traditional market research capabilities such as designing surveys and commissioning focus groups. Some organizations also may need help from external partners, a pattern that’s already apparent at several insurers and health care payers that have neither the time nor the budgets to build the necessary data-gathering and -analysis capabilities in-house and at scale.
“Marketing is going to become a much more science-driven activity,” says Duncan Watts of Yahoo! Research. In the trenches, this change suggests a shift toward sophisticated data analytics similar to the revolution that has already taken place in industries such as financial services, as well as in airlines and other industries where yield management is important. Some marketing organizations are already making their moves: to send targeted e-mails to customers, retailer Williams-Sonoma, for example, analyzes an integrated database that tracks some 60 million households on metrics including income, housing values, and number of children. These e-mails obtain response rates 10 to 18 times as high as those sent randomly. Such capabilities don’t necessarily have to be built in-house: many companies will enter into creative arrangements with outside parties to exchange data and run joint tests of alternative marketing tactics.
The major barrier to engagement is organizational rather than conceptual: given the growing number of touch points where customers now interact with companies, marketing often can’t do what’s needed all on its own. CMOs and their C-suite colleagues must collaborate intensively to adapt their organizations to the way customers now behave and, in the process, redefine the traditional marketing organization. If companies don’t make the transition, they run the risk of being overtaken by competitors that have mastered the new era of engagement.
Sales and Marketing
Product designers learned years ago that they’d save time and money if they consulted with their colleagues in manufacturing rather than just throwing new designs over the wall. The two functions realized it wasn’t enough to just coexist—not when they could work together to create value for the company and for customers. You’d think that marketing and sales teams, whose work is also deeply interconnected, would have discovered something similar. As a rule, though, they’re separate functions within an organization, and, when they do work together, they don’t always get along. When sales are disappointing, Marketing blames the sales force for its poor execution of an otherwise brilliant rollout plan. The sales team, in turn, claims that Marketing sets prices too high and uses too much of the budget, which instead should go toward hiring more salespeople or paying the sales reps higher commissions. More broadly, sales departments tend to believe that marketers are out of touch with what’s really going on with customers. Marketing believes the sales force is myopic—too focused on individual customer experiences, insufficiently aware of the larger market, and blind to the future. In short, each group often undervalues the other’s contributions.
Different Roles for Marketing
Most small businesses (and most businesses are small) don’t establish a formal marketing group at all. Their marketing ideas come from managers, the sales force, or an advertising agency. Such businesses equate marketing with selling; they don’t conceive of marketing as a broader way to position their firms.
Eventually, successful small businesses add a marketing person (or persons) to help relieve the sales force of some chores. These new staff members conduct research to calibrate the size of the market, choose the best markets and channels, and determine potential buyers’ motives and influences. They work with outside agencies on advertising and promotions. They develop collateral materials to help the sales force attract customers and close sales. And, finally, they use direct mail, telemarketing, and trade shows to find and qualify leads for the sales force. Both Sales and Marketing see the marketing group as an adjunct to the sales force at this stage, and the relationship between the functions is usually positive.
The cultural conflict between Sales and Marketing is, if anything, even more entrenched than the economic conflict. This is true in part because the two functions attract different types of people who spend their time in very different ways. Marketers, who until recently had more formal education than salespeople, are highly analytical, data oriented, and project focused. They’re all about building competitive advantage for the future. They judge their projects’ performance with a cold eye, and they’re ruthless with a failed initiative. However, that performance focus doesn’t always look like action to their colleagues in Sales because it all happens behind a desk rather than out in the field. Salespeople, in contrast, spend their time talking to existing and potential customers. They’re skilled relationship builders; they’re not only savvy about customers’ willingness to buy but also attuned to which product features will fly and which will die. They want to keep moving. They’re used to rejection, and it doesn’t depress them. They live for closing a sale. It’s hardly surprising that these two groups of people find it difficult to work well together.
Given the potential economic and cultural conflicts, one would expect some strains to develop between the two groups. And, indeed, some level of dysfunction usually does exist, even in cases where the heads of Sales and Marketing are friendly. The sales and marketing departments in the companies we studied exhibit four types of relationships. The relationships change as the companies’ marketing and sales functions mature—the groups move from being unaligned (and often conflicted) to being fully integrated.
When Sales and Marketing are aligned, clear boundaries between the two exist, but they’re flexible. The groups engage in joint planning and training. The sales group understands and uses marketing terminology such as “value proposition” and “brand image.” Marketers confer with salespeople on important accounts. They play a role in transactional, or commodity, sales as well.
Most organizations will function well when Sales and Marketing are aligned. This is especially true if the sales cycle is relatively short, the sales process is fairly straightforward, and the company doesn’t have a strong culture of shared responsibility. In complicated or quickly changing situations, there are good reasons to move Sales and Marketing into an integrated relationship.
Split Marketing into two groups.
There’s a strong case for splitting Marketing into upstream (strategic) and downstream (tactical) groups. Downstream marketers develop advertising and promotion campaigns, collateral material, case histories, and sales tools. They help salespeople develop and qualify leads. The downstream team uses market research and feedback from the sales reps to help sell existing products in new market segments, to create new messages, and to design better sales tools. Upstream marketers engage in customer sensing. That is, they monitor the voice of the customer and develop a long view of the company’s business opportunities and threats. The upstream team shares its insights with senior managers and product developers—and it participates in product development.
The Buying Funnel
There’s a conventional view that Marketing should take responsibility for the first four steps of the typical buying funnel—customer awareness, brand awareness, brand consideration, and brand preference. (The funnel reflects the ways that Marketing and Sales influence customers’ purchasing decisions.) Marketing builds brand preference, creates a marketing plan, and generates leads for sales before handing off execution and follow-up tasks to Sales. This division of labor keeps Marketing focused on strategic activities and prevents the group from intruding in individual sales opportunities. But if things do not go well, the blame game begins. Sales criticizes the plan for the brand, and Marketing accuses Sales of not working hard enough or smart enough.
knowing customers and finding new business oportunities
The prospect of lighting the world’s lamps gave raised to an extravagant promise of growth in the past. One might ask: Why would the oil companies do anything different? Would not chemical fuel cells, batteries, or solar energy kill the present product lines? The answer is that they would indeed, and that is precisely the reason for the oil firms had to develop these power units before their competitors do, so they will not be companies without an industry.
Management might be more likely to do what is needed for its own preservation if it thought of itself as being in the energy business. But even that would not be enough if it persists in imprisoning itself in the narrow grip of its tight product orientation. It has to think of itself as taking care of customer needs, not finding, refining or even selling oil. Once it genuinely thinks of its business as taking care of people’s energy needs, nothing can stop it from creating its own extravagantly profitable growth. Let us start at the beginning – the customer. Management must make quite an effort to break itself from conventional ways and produce customer satisfaction.
Marketing invariably does view the entire business process as consisting of a tightly integrated effort to discover, create, arouse and satisfy customer needs. The organization must learn to think of itself not as producing services but as buying customers, as doing things that will make people want to do business with. This means knowing precisely where the corporation wants to go and making sure the whole organization is enthusiastically aware of where that is. The companies must know what business exactly they are in.
Unleashing the Power of Marketing
Just 10 years ago General Electric had no substantial marketing organization. For decades the company had been so confident in its technologies that it seemed to believe the products could market themselves. People designated as marketers were assigned to sales support (lead generation and trade shows, for example) or communications (advertising and promotional materials). In discussions about corporate strategy, marketing wasn’t at the table. At best it was considered a support function; at worst, overhead. In a few GE businesses, such as appliances and the former plastics unit, marketing was a viable contributor; but in most of the others, its brilliant minds were languishing in dead-end jobs.
Many internal skeptics did not see how marketing as a function could help GE grow its businesses. Take GE Aviation, the multibillion-dollar division that develops and manufactures jet engines for commercial and military aircraft. The commercial aviation industry is relatively simple: a handful of aircraft manufacturers, two GE competitors (Rolls-Royce and Pratt & Whitney), and about 300 airlines. “You could put the entire industry in a conference room—it’s that compact,” says Thomas Gentile, the vice president of engine services for GE Aviation and a former chief marketing officer at GE Capital. “So the challenge was how could market research really help us? Because we could literally pick up the phone and call everyone in the industry who mattered and find out what was on their mind.”
But things were changing. The businesses were maturing, and like other companies, GE was learning that it could not win simply by launching increasingly sophisticated technologies or by taking existing technologies to new markets. Some of its best-thought-out new offerings were fast becoming commodities. Even executives within a business like Aviation were having trouble making sense of a rapidly changing industry. Fuel prices were volatile; demand was slowing; stronger regulatory oversight was around the corner. How could the business remain competitive and also prosper? “We didn’t really know how to translate what we knew about customers into the next growth idea,” Gentile admits.
GE’s solution was to focus on growth from within, across all businesses—a shift from the past, in which the top line was grown primarily by acquisition and the bottom line by seeking out efficiencies. The refocus ushered in a strategy fueled by technology, innovation, global markets, and stronger customer ties. To succeed, GE would need a marketing engine that drove more-direct collaboration with customers and led to new markets—one with standards as rigorous as those for functions such as finance and human resources. CEO Jeff Immelt issued a mandate that marketing should be a vital operating function across GE that spurred organic growth.
Recognizing that marketing was vital to all GE units was one thing; acting on that recognition was an entirely different matter. The marketing team took on the challenge of identifying and clearly codifying the modern-day skills it needed. We had to define what success would look like and describe how we would measure results. At the time, GE had no ready or consistent way of calibrating marketing efforts across units, markets, or business models, and we couldn’t find one in any textbook. Perhaps most challenging, we had to identify and develop leadership capabilities in our team, whose track record was uneven at best. In the process of creating what we believed would be the definitive marketing function, we arrived at new ways of thinking about marketing skills and about how to compose a first-rate marketing team.
Not Just a Support Function
Our framework centered on giving marketing a revenue-generating role in its own right. If GE could no longer rely solely on technology breakthroughs for hefty margins, we’d have to find both innovative ways of serving customers based on investments we’d already made and opportunities in new markets, new segments, and new products.
Marketing became the torchbearer for what was internally called “commercial innovation.” GE already had a long and rich history as a technology innovator. Now its innovation expanded to include ideas grounded in customer needs and market trends. Marketers took their place alongside technologists and had a voice earlier in the process, to ensure that GE’s offerings were differentiated and aimed at the right customer segments. As Immelt saw it, marketing would have a “line” role instead of its historical “staff” role at GE, and would be held responsible for critical operating mechanisms such as pricing and quantifying value for customers. He has pushed GE’s global growth with a mantra of “more products at more price points,” meaning that GE must not only target high-end users but also apply “just what’s needed” technology to better meet customer needs.
Ecomagination, GE’s clean-technology initiative, was launched in 2005. It directs investment in R&D and product development in the green and sustainability arena. Now a multitiered business plan, a point of view for the brand, and a purpose for GE’s people, Ecomagination has delivered more than 90 new products and $70 billion in revenue in its first five years. In all these initiatives marketing gets into the game at the start, sizing “white space” opportunities, meshing unmet needs with new technologies, and moving our brand in new directions.
The marketing leadership at GE had set an ambitious agenda, but no amount of ambition can make up for a dearth of talent. So the team doubled its ranks, from 2,500 in 2003 to 5,000 today. CMO positions were created for all GE’s businesses and at the corporate level. These leaders were both tapped from within GE and hired from a number of consumer- and business-oriented companies.
Global Promotional strategies
The multinational companies have to obey the same rules in terms of effective marketing communication.
However, the environments and the situations usually are more numerous and call for coordination of the promotional effort . People tend to react positively to companies and products they know about.
The international marketer basically has the same communication tools at is disposal as its local counterparts. However advertising, public relations, sales promotion, sponsoring and direct communication need additional international coordination.
The major objective of every multinational company is to achieve a strategic position on each market they are present in. The appropriate level of coordination depends on how important an internationally standardized identity is to the success of a company and its products.
Like local marketers, an internationally operating company uses advertising mainly to: stimulate potential customers interest in its products, make those products reach an intended position in the customers minds, continually remind the customers of the benefits to be gained by buying and using the product and prepare the ground for positive buying decisions by the customers.
Standardization means selling the same product worldwide. Its main benefit is cost savings in production and marketing.
As a response to integration efforts around the world, especially in Europe, many international marketers are indeed standardizing many of their marketing approaches, such as branding and packaging, across markets. Similarly, having to face the same competitors in the major markets of the world will add to the pressure of having a worldwide approach to international marketing. Companies such as Coca-Cola, Levi’s jeans or Colgate toothpaste are the evidence that the universal product and marketing strategy can work.
Increasingly, companies are attempting to develop global products by incorporating differences regionally or worldwide into one basic design. The costs and benefits associated with advertising standardization are more frequently stressed then maximizing the companies’ revenue potential. International advertising standardization makes sense only to the extent that the companies’ international marketing strategy centers on the development of brands that are similarly positioned in every market. A brand that is familiar will tend to be favored.
Global Branding Strategies
Global branding strategies consist of using the same brand name or logo worldwide. Companies want to leverage the creation of such brand names across many markets, because the launching of new brands requires a considerable marketing investment. Global branding strategies tend to be advisable if the target customers travel across country borders and will be exposed to products elsewhere.
Global branding strategies also become important if target customers are exposed to advertising worldwide. This is often the case for industrial marketing customers who may read industry and trade journals from other countries. Increasingly, global branding has become important also for consumer products where cross-border advertising through international TV channels has become common. Even in some markets such as Eastern Europe, many consumers had become aware of brands offered in Western Europe before the liberalization of the economies in the early 1990s. Global branding allows a company to take advantage of such existing goodwill. Companies pursuing global branding strategies may include luxury product marketers who typically face a large fixed investment for the worldwide promotion of a product.
The psychological power of brands is enormous. Brands are not usually listed on balance sheets, but they can determine the success of the company and allow it to demand premium prices. international marketers consolidates their company’s entire advertising account at one globally operating advertising agency. The coordination requirements of agency clients that operate in increasingly global industries have led major advertising agencies to strengthen their international services.
A companywide communication system is the most basic element of global brand leadership. Managers from country to country need to be able to find out about programs that have worked or failed elsewhere. They also need a way to easily find and receive knowledge about customers, knowledge that will vary from one market to another.
Observed in the long term, one of the basic responsibilities and rights of the managing structures is creating company culture. One of the most widely known methods of developing and presenting company culture is with the model 7S whose creator is the consulting company McKinsey & Co. This model forms a good guideline towards which all companies should aspire in determining and establishing their own culture, as a strategic characteristic.
In order to be successful in the global market, it is important that the advertising of multinational companies contributes to making the brand stronger.
Global Product Strategy
Pursuing a global product strategy implies that a company has largely globalized its product offering. Although the product may not need to be completely standardized worldwide, key aspects or modules may in fact be globalized. Global product strategies require that product use conditions, expected features and required product functions be largely identical so that few variations or changes are needed. Companies pursuing a global product strategy are interested in leveraging the fact that all investments for producing and developing a given product have already been made. Global strategies will yield more volume, which will make the original investment easier to justify.
the global marketing mix and global promotion strategies
The first approach is to consider the message. The company can change its message at four different levels. The company can use one message everywhere, varying only the language, name, and colors. Exxon used “Put a tiger in your tank” with minor variations and gained international recognition. Colors might be changed to avoid taboos in some countries. Purple is associated with death in Burma and some Latin American nations; white is a mourning color in India; and green is associated with disease in Malaysia. Even names and headlines may have to be modified. When Clairol introduced the “Mist Stick,” a curling iron, into Germany, it found that mist is slang for manure. Few Germans wanted to purchase a “manure stick.” The Dairy Association brought its “got Milk?” advertising campaign to Mexico only to find that the Spanish translation read, “Are you lactating?” When Coors put its slogan “turn it loose,” into Spanish, it was read by some as ‘suffer from diarrhea.” In Spain, Chevrolet’s Nova translated, as “it doesn’t go.” A laundry soap ad claiming to wash “really dirty parts” was translated in French-speaking Quebec to read “a soap for washing private parts.”
The second Approach is to use the same theme globally but adapt the copy to each local market. For example, Camay soap commercial showed a beautiful woman bathing. In Venezuela, a man was seen in the bathroom; in Italy and France, only a man’s hand was seen; and in Japan, the man waited outside. Danish beer company, Carlsberg, goes so far as to adapt copy not to countries but to individual cities and even neighborhoods within those cities. The 151-year-old Danish beer is available in more than 140 countries around the world, but because of the competitiveness and maturity of the U.S. market, it has to take a local tack in its approach to win new customers who aren’t familiar with the brand. All advertisements feature the same single image of the Carlsberg bottle, along with a humorous message about the specific city.
The third approach consists of developing a global pool of ads, from which each country selects the most appropriate one. Coca-Cola and Goodyear use this approach. Finally, some companies allow their country managers to create country-specific ads— within guidelines, of course. Kraft uses different ads for Cheez Whiz in different countries, given that household penetration is 95 percent in Puerto Rico, where the cheese is put on everything; 65 percent in Canada, where it is spread on morning breakfast toast; and 35 percent in the United States, where it is considered a junk food.
The use of media also requires international adaptation because media availability varies from country to country. Norway, Belgium, and France do not allow cigarettes and alcohol to be advertised on TV. Austria and Italy regulate TV advertising to children. Saudi Arabia does not want advertisers to use women in ads. India taxes advertising. Magazines vary in availability and effectiveness; they play a major role in Italy and a minor one in Austria. Newspapers have a national reach in the United Kingdom, but the advertiser can buy only local newspaper coverage in Spain.
Marketers must also adapt sales-promotion techniques to different markets. Greece prohibits coupons, and France prohibits games of chance and limits premiums and gifts to 5 percent of product value. People in Europe and Japan tend to make inquiries via mail rather than phone—which may have ramifications for direct mail and other sales-promotion campaigns.
Service Marketing and Service Marketing Mix
There are a number of key differences between the buying and selling of a tangible good and that of a professional advisory service. Perhaps the most obvious of these is that with a tangible good you have the actual product to evaluate, not just the person to whom you are talking. There is a mystique involved in evaluating a service that does not apply in buying a typical product. Also, in negotiating the purchase of a service the buyer often feels as though he is putting his fate in the seller’s hands.
In addition, whereas buying a good usually involves choosing from a finite number of alternatives within a well-defined category, purchasing a service is often critically dependent on which category of service is chosen. For example, should a company that feels its image is becoming “old-fashioned” hire a public relations firm to spruce up the image, a designer to modify the company logo, or a research firm to do a survey to find out why it is seen as old-fashioned, or what?
The above should suffice to make the basic point—goods are not the same as services, and the buying and selling of goods is not the same as the buying and selling of professional services. These differences in turn call for the use of evaluation and sales concepts different from those usually employed in the case of products.
Three Key Concepts
What then should a buyer or seller of services keep in mind? I believe the answer to this question lies in three basic concepts:
1. Minimizing uncertainty—A professional service must make a direct contribution to the reduction of the uncertainties involved in managing a business. The proper assessment of a service, unlike tangible goods, usually must take into account the impact of its performance on the client’s business.
2. Understanding problems—A professional service must come directly to grips with a fundamental problem of the business purchasing that service. The successful performance of the service, far more so than the successful production of a product, depends on an understanding of the client’s business.
3. Buying the professional—A professional service can only be purchased meaningfully from someone who is capable of rendering the service. Selling ability and personality by themselves are meaningless.
Marketing Mix for a Service Company
An expanded marketing mix for services is proposed consisting of the 4 traditional elements – product, price, place, and promotion and three additional elements–physical evidence, participants, and process. These additional variables beyond the traditional 4 Ps distinguish ‘customer service’ for service firms from that of manufacturing firms.
The Service Marketing Mix
The customer service for a service firm cannot be explicitly divided into pre-transaction and post-transaction elements, because production and consumption of a service occurs at the same time. The service provided can prove effective in terms of satisfying the customer, only if the gap between expected service and perceived service is bridged. The wider this gap, the more the customers may cause the image of the firm to deteriorate.
Most services are intangible because they are performances rather than objects, precise manufacturing specifications concerning uniform quality can rarely be set. Because of this intangibility, the firm may find it difficult to understand how consumers perceive their services. For developing a good customer service, the service marketer should stress on tangible cues and also create a strong organizational image. This can be done by communicating clearly to the customers the features of the service being provided.
Because of the intangible nature of the service–price becomes a pivotal quality indicator in situations where other information is not available. It is essential, therefore that the service firm engage in competitive pricing. Being an important tangible cue, price of the service is an area in which the service marketer can concentrate to get a competitive edge. In the case of pure services, as in the present context, like medical services or legal services price is an important factor because it is a basis for the customer to make a final choice among several competing service organizations.
Because services are performances that cannot be stored, service businesses frequently find it difficult to synchronise supply and demand. Also, services cannot be inventoried for the same reason. Consequently the service firms must make simultaneous adjustments in demand and capacity to achieve a closer match between the two. Also, the firm could use multisite locations to make the service more accessible to the users. If the service is located in a remote area, regardless of the other advantages of the service, customers would not be motivated to use the service.
The service marketer should constantly simulate word-of-mouth communications apart from using regular advertising. If customers in an existing market, for some reason or another have an image of the firm which does not correspond with reality, traditional marketing activities can be expected to be an effective way of communicating the real image to the market. Communication includes informing the customers in a language they can understand. Specially in services post-purchase communication is very important, because retaining existing customers is as important, or even more important than attracting potential customers.
5. Physical Evidence
Physical Evidence such as infrastructure, interior, decor, environmental design, business card, etc. that establishes firm’s image and influences customer’s expectations. Tangible clues help customer judging the quality of service before service usage or purchase. Before service usage the service is known by the tangible elements that surrounds it. In product marketing, quality of product is judged by the product itself.
Most services are highly labor intensive; the behavior of the personnel providing the service and the customers involved in production (due to the inseparable nature of services), have an effect on providing efficient customer service. To achieve customer-oriented personnel, the organization needs to recruit and select the right people, and offer an appropriate package of employment, in order to enhance their skills and encourage them. Because of the constant interaction between the employees involved in the service, and the customers–there is a mutual dependence between the two. If the customers are dissatisfied, employees experience discomfort working with unhappy customers, and customers are unhappy because the employees were not trained in customer satisfaction. The extent of this mutual dependence influences the customer’s perception of the service.
The how of service delivery is called the ‘process’ or the ‘functional’ quality. The attitudes and behavior of service personnel influence perceived service performance. These behaviors are usually associated with what is called the ‘process’. For example, when things go wrong in a service encounter, employees frequently attempt to sooth disgruntled customers by apologizing, offering to compensate, and explaining why the service delivery failure occurred. Any of these behaviors may influence customer attributions about the firm’s responsibility for the failure and the likelihood of it occurring again
What the customer actually gets out of the service, and how he or she perceives the service may not always match. So the customer’s judgment or evaluation of the service is the crucial factor in the delivery of a service. But service marketers can influence these perceptions to a large extent by controlling favorably the service marketing mix variables. It is all the more difficult because a service cannot be broken down into logical steps or sequences. If service organizations pay more attention to their employees as well as their customers, it would increase both employee motivation as well as customer satisfaction.
Marketing strategies for B2B Companies
“When efforts across the marketing continuum are well coordinated…we see all boats rise.”
Global Director of Marketing Communications, General Electric Co.
In today’s increasingly crowded and competitive online marketplace, companies to grasp their audience’s attention got to cut through the noise and earn it by utilizing creative and engaging B2B marketing tactics that distinguish them from the competition.
The first step is to create brand recall. Say you need a new laptop and you immediately think of Dell because you know the brand has been around for years; it’s a safe choice. However, if earlier that that week you saw a banner ad that said “The new HP laptop is thinner than Dell and guaranteed for two years!” you might start researching HP. The company’s goal that bought the banner ad was not to drive an immediate sale but to create brand recall that might influence future purchase decisions.
Applying this method to B2B marketing is a challenge but it can work. First, B2B marketers must build awareness of their brand. Then, you need to provide examples and testimonials of others who had had success with your product. You might create whitepapers and host webinars highlighting the advantages your product vs. other competitors.
You would also have to influence executives at your company and your trusted peers outside the company, so they would recommend your product to others. And finally, you would have to ensure this information stays top of mind, so customers don’t fall back on the safer path of reaching for the Dell laptop.
While the above example is simplistic, it illustrates how B2B products can be marketed and purchased every day. The best B2B marketers understand building a memorable brand perception is critical, and they also:
- Understand who their buyers are and will what influence them
- Know the key elements of a purchase decision and create messaging addressing those elements
- Create the content, best-practices, and case studies necessary to remove the risk of the decision
- Know how to distribute messages and content to targeted decision makers, influencers, and peers with the right frequency to get results
What can B2B marketers do to create a memorable brand? Below are five tactics you can implement right away.
1. Create Remarkable Brand Recall
The first step in any B2B marketing campaign is to create brand messages and campaigns that will stay with potential buyers long after they see the ad and the marketing message. Get creative and try new messages and slogans to make your brand stand out from the crowd and target them specifically to your audiences. Creating brand recall doesn’t happen with a single campaign − it’s an ongoing tactic, and you never stop branding.
2. Know Your Audience
Don’t treat your audience like general consumers. It is made up of business professionals looking to make the most economical, risk-averse and high-value purchases for their companies. Always keep their needs in mind when considering marketing tactics.
3. Use Visuals to Sell Your Product
Images are memorable long after words are forgotten. Make sure your campaigns are flashy, memorable and interactive. Use interactive banners, videos or social media ads to tell the story of your brand.
4. Maintain Creative Consistencies
Be creative, but make sure your ideas are consistent across all your marketing campaigns, including paid ads, social media, sales sheets, webinars, whitepapers, and your website. Synch your messaging across all media activities as you move buyers down the marketing funnel.
5. Use a Personal Touch
While your audience consists of businesspeople, that doesn’t mean they are robots who don’t enjoy a good laugh or a personal touch. Create marketing materials that speak to the human side of the business world. Since many B2B campaigns are boring, adding a human touch to your campaigns will make them stand out.
While B2B marketers don’t have it easy, it’s quite possible to create memorable brands. Companies can sell by educating their potential buyers, making sure influencers know about them and by producing campaigns that convince customers to buy their products or services rather than those of their competitors.