I'm an avid reader of marketing books, magazines, web sites, and newsletters. Like any discipline, I believe it is important for marketer's to stay current with the latest thoughts and ideas in their field. I get inspiration and ideas from other people's different and unique perspectives on the subject of marketing. As Albert Einstein said, "the secret to creativity is knowing how to hide your sources".
Being open to new marketing ideas forces us to challenge our conventional way of thinking and ask questions we otherwise would not have asked. This, in turn, can lead to breakthrough ideas.
In the Monday Wall Street Journal, there was one such article titled "Mistakes Marketers Make" written by Dr. Corkindale from the Universirty of South Australia's International Graduate School of Business.
I'm not sure I am in 100% agreement with all seven (see below) but I spent a lot of time thinking about each one as it related to our company and in the process, asked some important questions I would otherwise have not asked. Do you agree with all these mistakes? Leave a comment.
The mistakes included:
Mistake Number One: Companies Need to Find and Target the Market Segments for Their Brands. Wrong says Dr. Corkindale. Aim at the broader market. The profiles of those who buy different brands in a particular product category are not that different. Marketers who only target a certain buyer lose potential business - and spend unnecessary market research dollars on segmenting the market. In one recent marketing study, nearly 50% of consumers said they bought the same brand of gasoline regularly. However, after studying their purchasing behavior for 6 months it was found they only bought their brand 6% of the time. The same results were found across most product categories.
As an example, Apple Computer scoffs at the notion of a target market. Apple doesn't even conduct focus groups. According to Steve Jobs (from a recent Fortune Magazine article):
"You can't ask people what they want if it's around the next corner," says Steve Jobs. At Apple, new-product development starts in the gut and gets hatched in rolling conversations that go something like this: What do we hate? (Our cellphones.) What do we have the technology to make? (A cellphone with a Mac inside.) What would we like to own? (You guessed it, an iPhone.) "One of the keys to Apple is that we build products that really turn us on," says Jobs.
Is your target market to narrow?
Mistake Number Two: Loyal Customers are the Most Valuable. Wrong again (according to Dr. Corkindale ).Totally loyal buyers of a brand tend to make up only 10% of all buyers - and they often buy less frequently than other buyers. A company that focuses on gaining and retaining these buyers may not be doing the smartest thing.
Mistake Three: The Only Ways to Grow Your Brand are (1) increasing the customer base (2) increasing the loyalty of customers and (3) increasing the frequency of their purchases. Dr. Corkindale says no! The only way to achieve lasting sales growth is to either reach new customers in existing markets or enter new markets. Companies regularly swap customers with competitors but that does not result in significant changes to market share. You need to grow the pie.
This is very relevant to the human capital marketplace.
Mistake Four: To Succeed, You Must Differentiate Your Product. Not according to Dr. Corkindale who says that doing so restricts your product's appeal to the small set of customers who like what you did differently. What most customers want is not differentiation but products or services that are simply better at doing the routine things they expect.
Again, very relevant to the HR marketplace.
Mistake Five: Promotions Bring in Extra Worthwhile Business. Nope - promotions just attract people who were already customers. The result? Giving discounts to the people who would have bought anyway. And the new customers you do attract often don't become frequent customers.
Years ago while on a business tour in Hong Kong I met with an executive from a Japanese owned department store and they told me they never have sales for this very reason. In the retail department store business in America this was unheard of. Maybe he was on to something.
Mistake Six: The Company that is best at Marketing the Four P's (product, place, price, promotion) Wins. Half correct says Dr. Corkindale who says that equally important is "brand strength". A strong brand is one that people trust and that has a track record of high quality and reliability. Companies need to do everything possible to nurture their brands. I couldn't agree more.
This alone is a reason to keep your marketing going during a slow economic times. I continue to be shocked at the number of companies in the HR space who simply stop marketing during tough economic times. Bad idea.
Mistake Seven: Marketing is All About Hunting and Capturing Clients. Not anymore says Dr. Corkindale. The Internet has changed everything. Consumers proactively hunt out and evaluate you online. They use the internet to find and make choices about the products they buy.
Readers of our HRmarketer.com Trend Reports already understand this. The role of marketing is to make sure your company's products or services are easily found online. Dr. Corkindale, you are absolutely 100% correct on this one.Labels: marketing