The more you observe how your market evolves and how daily life changes, the more you realize that you have no choice but to change your marketing thinking and the way you manage your human resources...
The following study is based on the author's conviction that, the more you observe how your market evolves and how daily life changes, the more you realize that you have no choice but to change your marketing thinking and the way you manage your human resources. Moreover, you will probably need to revolutionize your traditional management methods. The latter statement is based on the belief that marketing and human resources management play a major role in nearly all executive positions.
CURRENT UNFORTUNATE POSITION OF MARKETING:
Scholars, consultants and other experts have been obsessively teaching and publicizing about the necessary splitting between the marketing and the selling functions. They were attempting to put so-called Marketing Departments in an "ivory tower", separated from the other activities of a company. Those departments would overlook operations and give directions and analysis reports based on a distant watch of reality and of its changes.
This theory had many drawbacks and limitations, essentially due to the fact that it leads marketing officers to lose touch with what is happening down to earth. However it had the significant advantage of trying to instil a vision in managers' minds, this vision being of the utmost importance for valid strategy formulations and for the rationality of companies' ways of operating.
For many reasons, an excessive number of companies have failed to put any part of those lessons into practice. This resulted in the inexistence of adequate plans, in haphazard advertising campaigns, in unprepared sales forces, and, often, in senseless marketing reports and market researches. To illustrate this, many studies have shown that more than 70% of marketing expenditures are totally useless; the problem is that it is quite difficult to know which 70% we are talking about .... The marketing mission was (and, in many cases, still is) lost somewhere into a "Commercial Department" or into a "Marketing & Sales Department", and diluted in them. Moreover, marketing thinking and expenditures are usually considered as "unavoidable sacrifices", and as burdening the sales effort, whereas marketing officers often do the tedious and unwanted office work of the salesmen. Funnily enough, many people are proud to cry aloud that they are "marketing managers" ...
HOW HUMAN RESOURCES ARE BEING CURRENTLY CONSIDERED:
Human resources have followed a similar track. It has been many years since books and publications have begun to talk about "human resources management" instead of "personnel management", explaining the difference between them. In our century, the preaching must have started with Alfred Sloane when he was C.E.O. of General Motors, followed by Pr. Maslow and his "Pyramid of Human Needs", then, among other people, by Pr. Harry Levinson and his "Exceptional Executive", and by Pr. Peter Drucker with his "Peter Principle".
It is always quite self-motivating to talk about issues that are aimed at letting people be more humane, more respectful, and, actually, be better people. The problem is that words are different from action and that action is practically nowhere to be seen: the implementation of human resources management is basically limited to a mere change in departments' names. Employees and managers are still mostly evaluated according to their seniority, to how agreeable they are to their bosses, and to some other static measures. The latter are not linked to individual or group performances, and are not related to their contribution to the value growth of the company. Moreover, just like the lack of importance given to marketing efforts, the personnel chapter is seen as a cost that has to be minimized regardless of any other consideration.
At this level, common sense would easily show all the wrongdoings.
"New" Marketing is just a name given to an effort of giving back to the previously described activities their deserved roles, and of adequately linking them. Without that effort, companies will find it quite difficult to survive, let alone to become profitable. Anecdotally, as a colleague and close friend of mine keeps on saying, all you need to know is clearly explained in Chapter 1 of any good book on Marketing Management.
Nowadays, and the trend shall certainly continue, potential customers of any given product are confronted with a large number of competing products in any market. They are also quickly informed about any product, thanks to the speed of transmitting information and to the wide variety of communication means: comprehensive "directions for use", mass media advertising, on-site demonstrations, testings, seminars, mailed samples, etc.. They are more educated, thanks to richer background studies and to easier access to information.
They are also quickly mentalized about the use of new products, whether these products are embellishments of existing ones (i.e: new packaging, new sizes, new colours, ...) or the result of new or improved technologies. This is so because, mainly in recent years, the high frequency of all kinds of product launchings gave customers the benefits of "experience curve effects": they learn about new products more easily. Added to this, it takes less and less time for competition to come out with an improved product.
The result is that people are better prepared to understand the uses of a new product, in a remarkably short period of time. What is worrying for product suppliers is that this situation drives customers to be increasingly demanding on what they buy: they always want more. On top of that, competitors are watching closely each one of our moves, waiting for the first weakness or mistake to show up so they can quickly correct it. As it seems here, success in the market does not appear to be an easy exercise.
THE CUSTOMER IS KING:
It appears that the customer is in charge. He seems to have the power to do or undo profitable selling efforts of whole lines of products. Very little can be done about that: either you accept the situation, try to live with it, manage it, and attempt to turn it to your own advantage, or you do not accept it, then good luck with your business. You may argue that an easy way out would be not to educate customers too much .... Unfortunately, customers are going to find, in no time, many alternative ways for educating themselves, and you are back to square one.
THINK "SERVICE" NOT "PRODUCT":
What has to be done here is to start thinking "service" not "product". This needs quite a transformation in the business mentality. Because, instead of the traditional thought of what the product "is" and "what features" it offers, you should start to think of what the product "can do to the customer to make his life better and easier" while, if possible, "enhancing his particular environment". Moreover, and above all, you should force yourself to think about how the "customer can enhance the product himself and participate in its development and in its continuous upgrading".
Under these conditions, it is far from enough to only publicize the features and functions of the product. You should also advise the customer on consumption occasions, prize him for frequent purchases (with special discounts, or a trip, for instance), create special ceremonies (such as: lotteries, institution of a "Club of preferred Users", etc...).
Moreover, you should offer him the possibility of contacting you on a Hot-Line for any observation or complaint he may have, and of visiting your factory or your warehouse. Above all, you should try to appeal differently to different categories of buyers, i.e. you should "target" your product. All this may seem like a costly exercise. However, by doing this, you progressively create a close link between your customer and yourself and a progressive identification of the customer with your product. You would be a true "consultant figure" to your customer. Consequently, he will not be inclined to look for substitutes. This kind of relation is naturally quite difficult to copy.
In order to achieve those positive results, many stages in the launching of a new product start with the customer himself, not with what you decide to sell him. Consequently, before, during, and after the launching, you need to be regularly informed of the constant evolution of his expectations, of his perceptions about the usages of your product, and of his reactions after the purchase. You should also ask him his opinion on future upgradings to your "service".
These data must be classified along different and homogeneous types of potential customers. You would then be able to determine main and secondary targets in your market, which you would address differently through your advertising, your personal promotions, etc... Therefore, you must know your customers increasingly well, simply because you shall be bound to provide them with a constantly improved "service". One essential issue here is to also check why people are buying or not buying the product. The results of the latter study can be quite surprising and unexpected, thus useful.
All this is best done through regular market researches and by a thorough transcription, and a regular sorting, of complaints and observations transmitted through your Hot-Line. Those market researches are qualitative. They are at least as important to the survival and growth of your business as the quantitative ones, i.e. the researches on how much you are selling, in which geographic areas, and so forth.
CONSUMER VERSUS CLIENT:
Many companies have a tendency to mix the consumer's concept with the client's concept. When they do not confuse them, they do not understand that clients are to be dealt with differently than consumers. Let us remember that a consumer is the end user of the product. Whereas the "client" buys products directly from you. He is the one you have the more direct contact with. He is the one who will let products and services be available to consumers.
Therefore, you need to know him (his expectations, his problems, etc ...) and treat him at least as well as your end users. This acquaintance process is much easier than with consumers, given, on the one hand, that your clients are surely much fewer than your consumers, and, on the other hand, that you have a personal access to your client, something usually difficult with end users.
Knowing your client well drives to good communication. That makes him be more willing to better sell your products. Moreover, as we just mentioned, this knowledge process is a simple exercise. So what is stopping you ? A better and better service offered on your behalf by resellers who are happier and happier to sell it, is an ideal and easily reachable situation.
One efficient tool for reaching optimal knowledge is to use a comprehensive "Client File" that would not only contain selling figures and orders backlog. It would also be constantly upgraded with whichever new information you have about the client, his evolving needs, his problems and the way you found solutions to them or the reasons why you could not find them. On top of that, you would take note of the competitors' moves, of whatever details you can gather about the client's personal situation, etc .... This "Client File" should lead you to build a real TRUST atmosphere in your relations with him. Therefore, all your business dealings shall be much easier, making things all the more difficult for competing suppliers.
Moreover, he usually knows personally most of his own clients, the largest part of them being those same consumers whose identity you do not know. By helping him to upgrade his dealings with them, he would be very grateful to you. You could then enrich your "Client File" with a new and quite useful chapter that contains comprehensive data about each one of your clients' market. That would help you to build a solid network of clients and consumers, whose links with your company and its products get tighter every day.
Actually the quality of your dealings with your clients is an integrated part of the "service package" that you are offering to the end users' market.
NEW MARKETING AND SELLING:
The relation between "New" Marketing and selling is a direct consequence of what we have analysed until now: a constant interaction between market information, marketing analysis and action, selling effort, and feedback from the sales force. The final objective is that, by selling him the product, we provide the customer with a whole set of satisfying services and of fringe benefits that are meant to "delight" him. An outstanding part of those services is that, as we mentioned above, he would have participated in their development and in their upgradings. All that cannot but enhance his "perceived" quality of the product.
He would also have the genuine feeling that he has a "ONE-TO-ONE" RELATION with the company, i.e. that the efforts of the whole company are exclusively aimed at his personal satisfaction. Let us compare this to the services you get in a good restaurant: a regular customer goes there not only for the good cooking, but also because he is seated at his preferred table without him asking for it, or he knows the ma'tre d?h?tel by his first name. Moreover, the waiter knows which is his favourite dish, how he likes it to be cooked, and which dressing or toppings he fancies, etc ...
Whenever your service can favourably compare to the one provided by that restaurant, you are on the right track for great success in your business. You can easily deduce that, when you have built this positive environment for the client, you shall easily sell him any new product you are ready to supply him. Actually, the only new part of this approach is the tighter links you create between your marketing activity and the selling effort. But you are still clearly splitting them.
EFFECTS ON HUMAN RESOURCES MANAGEMENT:
In fact, our approach affects all the other aspects of the company's activity, particularly human resources management. "New" Marketing is really a new way to conceive management methods and to implement them. If employees and middle managers are not motivated to be perfectionist in customers' relations, then the whole idea will fall apart. This is so because these people have the more direct and frequent contact with customers, so they are the ones who can make the plan work.
That can only happen if their evaluation is directly linked to their performance with customers. Top management should also give them the right means for yielding optimal results. In other words, they should get regular and adequate TRAINING, and the authority conceded to them over their work should be on a par with their accountability for results. Moreover, the organizational hierarchy of the company should be flexible enough in order to allow them to obtain a quick collaboration from employees in other departments with minimum bureaucratic impediments, so that the customer can get a fast and better response. The secret for business success is to let OPTIMAL CUSTOMER SATISFACTION be the top priority of the job of every single employee.
Consequently, performance evaluation should be mainly based on the following type of criteria: quality of service given to customers, creativity in problem-solving, communication skills, ability to work in teams, efficiency in responding to customers' complaints (maybe an invoice is wrong, or the telephone operator has not answered the customer's call as warmly as she should), etc ....
Actually, your most easily accessible customers are your employees. They can also be your most efficient marketing officers: if they are happy in their work, they will constantly talk about the benefits of the "services" their company provides. This kind of advertising is naturally more carefully listened to than the unilateral messages that you advertise in the media.
All what we talked about here is plain common sense. It shows you that the corner-stone for the whole structure of your business is: PEOPLE. In an era where customers have constantly changing requirements, constantly evolving needs, and constantly new demands for upgradings of products and services, your main and most reliable asset are the PEOPLE IN YOUR COMPANY who have to respond to these changes. And the only way to beat competition and to yield customer loyalty is to consider these CUSTOMERS AS PEOPLE, not as remote numbers in sales reports.
People do not just buy a product: THEY WANT VALUE and VALUE IS SERVICE. And people in your company, if treated as such, will provide the best Service to them. This will seem like a vicious circle if you refuse to see the obvious. But if you start to act and to change your mentality accordingly, it will be, on the contrary, your spiral of success towards long-lasting profitability.
Marketing was, traditionally, a branding exercise aimed at increasing the value of products. "New" Marketing and, similarly, "New" Management, is about letting the image of your whole company be the brand that identifies your services in the market place.
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