Many CEOs tell me about marketing companies that call or email them to sell automated nurture, or paid search, or SEO, or other services that they assure the CEO is what works. There are certainly some marketing tactics that one might consider fundamental to many business operations but the real truth is, and the #2 in my series of 7 things every CEO should know about marketing, tactics that work for one or more companies do not necessarily work for your business. Marketing is not cookie cutter or standard for every business.
Choosing what marketing to invest in is more complex than just choosing which tools or which approach to use. It is about matching specific marketing efforts, that offer specific types of outcomes, with the current state of your business in terms of products and services and your opportunity.
Assessing the Business Factors that Determine Effective Marketing
When I begin to assess what type of marketing activity is going to work effectively for a business, I start by asking questions relating to the status of these five factors – brand status, competitive status, target segment status, product and/or service demand, and the sales revenue/margin of the product and/or service we are going to market. In this short post, I will not be able to dig into all the details, but here is a sample of the questions I would be asking to influence marketing choices.
Is your company (your brand) new to the market? What is your brand awareness in the market? Are you the clear market leader in terms of brand? Do you have a positive brand image/reaction in market? Are you a trusted brand or relatively untrusted or not proven?
Are you the high-value, highest price seller in market? Are you the lowest cost in market? … or where on that spectrum? Are you the dominant seller? What is your market share in volume? What is your market share in dollars?
Target Segment Status
Is your target segment a finite and known group of companies (example would be all transit authorities in US, or international airport since those are easy to find and there are rarely any entries/exits in market)? Does your segment have new entries constantly (like new home buyers, as people buy homes every day) that you must find or help find you? Do you have a reliable marketing list (contact list) for your market segment? Will you need to rely on using media companies to reach your audience (e.g., professional audiences are best marketed to via media companies – like electrical engineers)?
Product and/or Service Demand
Is there pent-up demand for the product/service? Is the market saturated with this type of product or service? How do you compete, meaning (a) offering truly “unique” product/service that separates you from others, (b) doing what others do, just better, or (c) doing what others do but cheaper? Will you have to educate potential buyers that they “need” what you are offering (create demand and then sell)?
Sales Revenue/Margin of the Product and/or Service
What are the current sales goals (volume/revenue)? How many sales conversions will come from the sales team vs. what expectation is for conversions from marketing? When sales finds a true opportunity, how many do they win – what is their win-rate? What is the expected revenue per win? Margin per win?
Relating Marketing to the Assessment
I am not deliberately trying to hide any secrets here, but I will say that trying to share the experiences and knowledge that provides the perspective to take the answers to those questions and make sound marketing choices would require us either (a) to have a more lengthy workshop, or (b) require me to write a more lengthy “book like” chapter. For now, let me just share a sample matrix that I have built using some basic scenarios that might come from some answers and the very broad range of marketing that could be prioritized. The purpose of the table below is not to “eliminate” certain types of marketing but just to talk about the priorities (and of course, these examples are superficial and would be based on deeper discussions).
The first scenario, in the table above, would prioritize marketing when your company is new to the market. The focus would normally be on branding (print, digital, trade shows, paid search) to establish your name and trust – as the “ante” for a seat at the table in that market. However, an exception to that priority might occur, for example, if you were new to the market but at the same time were introducing some disruptive technology that was so obviously needed and desired (great demand). In that case, you could focus more on programmatic and social to drive buyers to you as a priority.
The second example might be the priorities for a well known brand that offers the highest value and highest priced product/service in the market. The key here is that your marketing must continue to educate and inform the market. Priorities would be to utilize premium content, nurture, trade shows so that people continue to value what you have and understand your value.
A last example might be for a high demand product that happens to be the lowest price (good for you!). This is ideal. Basically, you are marketing a product that people want and you have the lowest price. High priority to programmatic and social marketing, and generating strong reviews for your product so that the low price also conveys that you have quality offerings. It is less about educating and more about getting people to your website to purchase or to request a quote, etc. You are likely going for higher volume (and maybe lower margin).
Not All Marketing is the Same
I hope this short discussion has at least provided the right questions for you as a CEO to ask about the “types” of marketing that internal or external resources might be recommending. How does that marketing tie to your current business status, strategy, market demand, pricing, and competitive positioning. Is the marketing going to be delivering the value you need? As always, I’m happy to discuss further with any CEO that wants to know more (contact me).