1: Really know your customer needs
2: Differentiate your products/services
3: Develop the customer experience to meet & exceed expectations
4: Reach your best prospect customers cost effectively
5: Measure & evaluate success – is it working?
If there is a magic formula to growing any business, it is both understanding and applying the following 5 key steps, based on the core principles of marketing.
Sounds easy to say, but it’s simply amazing how many companies (if they are truly honest with themselves) dismiss, or half-heartedly address some of these 5 key steps, then wonder where it all went wrong! We’ll look at each of these steps in turn, firstly to understand why they are so important, then secondly to review how to apply them in the real world, without breaking the bank. In each case you can undertake some work internally; often it is useful to seek the help of a Marketing Consultant.
Many companies believe that “of course” they know their customers’ needs, on the basis that they have been serving them for years! However, if you ask them about the last time they actually asked their customers, in a way that could illicit more than just a polite response, they become less sure about it.
Customer needs and preferences change all the time. New competitors can grab their attention at any stage, usually when you are least expecting it. It is so easy to get complacent, and assume that past success will continue into the future. If you really know your customer needs, you can build a successful business; however, if you don’t then you may not have a business for very long.
It is best not take your customers for granted, you need to continuously be aware of changes and open to new opportunities. So how do you do that? Well, a solid market information system is a good starting point. Are you truly tapping into all the information already available to you? Some of the most under utilised assets in any company include:
Customer complaint reports
Properly structured sale force reports
Chats with your sales office personnel
Spending time out with the sales force on the road
When was the last time you undertook some formal research with your key customers? This can be easily arranged and it need not cost a fortune. It can give you real insights into how you are performing in all aspects of business as compared with your competitors. The key is to ask the right questions of the right people, in a way in which you are likely to get realistic responses and real insights. This information will form the building blocks upon which you can build your business.
This is one of the most challenging issues for any business to-day. Many new innovations can be copied at the speed of light, so how do you really stay ahead? Well, you are not just competing in the marketplace you are really competing in the “mind” of your potential customer. You are competing to make sure you are top of mind whenever your target customer is making their purchasing decision. The best way to succeed is to truly stand for something, not just anything, but something that truly matters to your customer. This may not be your product, but your delivery or service, if “saving time” matters to your customer.
It is best to undertake this review in a quiet location, off-site, with the telephones turned off, away from everyday concerns. With all key areas of your business represented, it’s best to “workshop” the options in an open and honest atmosphere using a suitable methodology which will illicit the various options. This can be done with or without outside assistance, however, an external facilitator would be an advantage.
There are many ways to differentiate from your competitors. The following are some of the key ways to consider:
Being the first & original
Owning an attribute (e.g. Fastest, slowest, )
Being the leader
Being the longest established
Being a specialist (niche expert)
Being truly unique (e.g. Special patented aspect)
Although most companies focus on differentiating on price or product quality, both of these can be easily copied. So despite their popularity, they are not all that sustainable.
There is so much talk yet so little action on this one it never ceases to amaze me! Just think of how many times you hear people complain on a daily basis about some product or service which fell short of their expectations – well each time you hear that, some company is failing in this key step!
It is now well accepted that it is far cheaper to hold onto the customers you already have, than pay dearly to win over new customers. The objective is to satisfy your current customers and have them act as advocates speaking positively about your company, its products and services. This is a very cost effective way of growing your business.
This is easier said than done. One of the best ways to do this is to identify the potential customer’s journey from recognising their need, to evaluating the competition, to finding your company, to selecting whichever product/ service, to purchase, delivery, payment, after-sales – in other words, their purchasing journey.
Each stage in the process where your company interacts in any way with a potential customer is often described as a “moment of truth”. Although this is a bit of marketing jargon, just consider the meaning behind it, as this is what really matters. A “moment of truth” is actually very telling to a potential customer, as it is an opportunity for your company to meet and exceed customer needs and equally, an opportunity to let them down and lose credibility!
The importance of focusing your marketing budget cannot be overstated. It is all too easy to spread precious financial and human resources too thinly, trying to be all things to all people. This simply does not work. You need to make tough decisions, most importantly, who you will not be targeting, whose business will you sacrifice?
Unfortunately marketing has got a poor reputation in many areas of business as it is seen as wasteful, not relevant, and not working. This can happen where companies either do not have (or do not implement) a solid well thought out marketing strategy.
The success of your marketing all hinges on having a solid marketing strategy in place:
There – it’s that simple!
There is a wide selection of potential media available to reach your target market. Your choice should take account of both the quantitative and the qualitative factors. E.g. Money spent on creating a good web-site which relieves time of the sales office staff by handling frequently asked questions effectively, is money well spent.
It is often debated as to whether or not you can measure marketing effectiveness. I believe you can, however, it requires a combination of logic and intuition to fully appreciate marketing effectiveness. It is a mistake to purely look at quantitative measures; equally it is a cop-out to say marketing defies measurement. At the end of the day, it is a matter of common sense.
It is important to measure marketing effectiveness for a variety of reasons:
Marketing strategy ultimately drives the success or failure of any company, therefore you need to measure what drives this strategy
Marketing spend can be significantly under or over budgeted, using appropriate measures helps to determine a suitable marketing budget
It is critical to distinguish measures which merely report performance results (e.g. sales, market share) from those which actually drive performance (e.g. reducing customer complaints). The overall goals are based on performance results, but the best way to achieve those goals is to improve the key drivers of performance.
In any company it is best practice to have a range of measures in place as follows:
Quantitative (factual comparisons over time)
Qualitative (soft information, critical to future success)
Internally derived (e.g. sales, profit per product / territory / section etc)
Externally derived (e.g. market share, customer satisfaction surveys etc)
These measures can be determined internally, however, it is often useful to have the benefit of an independent external advisor, who can look more objectively and provide a wide range of measurement techniques.
As I said at the outset, if there is a magic formula to growing any business, it is to understand and apply the 5 key steps of the Business Growth Cycle, which are based on the core principles of marketing. It begins and ends with the with the Customer.
In my opinion the most important, most talked about, most agreed upon aspect of marketing, is the issue of putting the customer centre-stage. However, when you look at the level of customer complaints and customer dissatisfaction in the marketplace, it appears that there is a lot of scope for improvement.
However, as you can see from the above, there are many simple ways to improve performance by following the 5 key steps of the Business Growth Cycle.
Simple changes can make an enormous difference
Simple changes do not cost lots of money