An Open Invitation

As a thank you to those of you who take the time to read and follow my blog, I would like to make this offer:  Ask me any question related to Business Strategy, Marketing or Entrepreneurship and I will do my best to provide you with an honest answer.  This is an opportunity for you to receive free consulting advice from someone who has been there and done that.  Just give me as many facts as you can surrounding your question and I will give you my best advice!  

Rich

Bizvice:  Business Strategy, Marketing & Entrepreneurship

Back To The Future

Despite the growing chorus of the need to do marketing differently in today’s wired world, the need still exists for Companies to communicate with their potential customers with a message of why they should buy your products.  So, is this really “back to the future.”?   I believe it is…  It is important for Marketers to keep focused on communicating their key point of difference.  To be sure, there are many more options for such communications.  But, at the end of the day, it is all about how many target customers you can reach most efficiently with the right “message.”

Using the “new” media is often an experiment.   And, every advertiser wants to stand out from the crowd.  So, often the message of why a product/service is better is often lost in the translation of “creativity.”   People buy products because they believe they have a need which will be uniquely filled by that product.  If you do not communicate your uniqueness in a compelling way which gets this message across, then you are wasting valuable resources and money.

So, the next time your “creatives” develop a new approach to market your  product ask the simple question:  “Does this approach focus on why my product is truly unique versus competition?”

Rich

Bizvice:  Business Strategy, Marketing & Entrepreneurship

Growth versus Expense Reductions

In the 80’s and 90’s the mantra was expense reductions for companies of all sizes.  That was the way to improve the bottom line.  Those companies that were successful in reducing their expenses did well in the short term.  I emphasise short term!   You cannot be successful in the long term by simply getting expenses in line.   You MUST grow the top line to truly be successful. 

Of course, growing your top line is much harder then cutting expenses.  You must find a way to revitalize existing businesses, find new growth opportunities and explore mergers and acquisitions.  This is hard work!  It is always much easier simply to fire people, close plants or take other measures to cut  expenses.  Yet, if you follow a disciplined approach to growth it reduces complexity and increases your odds for success!

So, how do you approach growth?  It requires a complete analysis of your Company’s strengths and weaknesses, the same for your key competitors, and a customer based needs analysis.  Thus, where need is greatest and your company has strengths and your competition is weak, you will find the best opportunities.  Of course this is the area that needs complete objectivity and a thorough vetting.  That’s where the hard work lies!

Rich

Bizvice:  Business Strategy, Marketing & Entrepreneurship

Road Trip

I recently took a road trip in the South East and observed something I have written about in the past.  How unexciting automobiles are today.  Most sedans look the same.  Most SUV’s look the same.  We live in an automobile land of blandness.  I understand the concept of “functionality.”  But a car, at least to me, elicits an emotional response.  I will confess that I love cars.  There are exciting cars out there but they are clearly in the minority. 

First of all, most cars come in dull colors.  And, most are only one color.  This adds to the “blandness” of the auto landscape.  Next, most cars look the same.  It is really hard to  tell the difference between most makes.  When I grew up, I knew every car and every model because they looked unique.  Now, there is little differentiation.  When a “new” design comes along everyone gets excited…  look at the “Smart Car.” 

So, how does the industry break out and do some innovate product development?   Start with color…  let customers choose from a wider range of  colors and look at the car as an object of art.  Thus, there must be things you could do from an appearance/paint point of view to liven things up.  Remember the two-tone cars?  Even Rolls Royce used to provide such an option.

Next, seek radically different designs… perhaps by demographics…. cars for young women, retired men, etc.  I recognize that the manufacturing process puts significant restrictions on any customized and unique approaches.  But, this is America… I am sure great minds can figure out a way!

Let’s rid the roads of blandness!  

Rich

Bizvice:  Business Strategy, Marketing & Entrepreneurship

Individual Marketing Customization

I have written in the past about personalization of products and services to meet the differing needs of individuals.  A recent interview with Bill Gates of Microsoft fame reminded me that individual marketing customization is just as important to the immediate future of marketing programs.  Indeed the opportunity to customize messages to specific individuals is at the very foundation of the boom in marketing via the Internet.

If, as a marketing approach, a manufacturer could target specific individuals with a specific and relavent message about its product and could truly monitor whether those individuals responded by buying the product then enormous efficiencies would accrue to the entire marketing budget.  How specific can you get with both the individuals “targeted” and the relevance of the message is the critical question.  In the future, I believe you will be able to get highly specific on both counts.  For example, if you were selling cell phones and you could identify those potential customers who wanted a specific type of cell phone with specific characteristics (e.g.: camera, voice recorder, phone book, etc.) and you could deliver a specific message about such a phone to those customers then your marketing dollars would be much more effective.

Finding your key customers on an individual basis is the trick.  So, experiment with the “new media” available today.  And, be sure to link your experiments to actual sales data whenever possible.

Rich

Bizvice:  Business Strategy, Marketing & Entrepreneurship

Sustainable Competitive Advantage

Sustainable Competitive Advantage is, perhaps, the most important characteristic of a successful Company, Product, or Service.  Without a competitive advantage that is either real or perceived by customers that can be sustained over time, the prospects for a successful business is slim to none.

How do you know if you have such a sustainable competitive advantage?  Do your homework!   What are the critical differences between your service or product and your competition.  Have you researched this difference with your customers?  Do they agree that what you are providing is clearly and meaningfully different and better then competition?  Is this differentiation sustainable over the long-term as a result of patents, unique technology, unique manufacturing capabilities, etc.?  This is the point in your business development where you really need to be objective and honest with yourself.  If your product or service cannot live up to this type of scrutiny, then you probably should not pursue that service or product business.

So, get a good research partner and get the answers to the questions above before you go to far.   You will clearly benefit in the long-run.

Rich

Bizvice:  Business Strategy, Marketing & Entrepreneurship

Strategic Imperatives

Have you ever been confused over establishing priorities for your business.  One way to think about this issue is to establish strategic imperatives.  Essentially, strategic imperatives define what you absolutely must accomplish over a given period of time to be successful.  First, of course, you need to define your overall strategies within the context of your business plan. 

Once that step is accomplished, you must review your entire plan and decide which strategies must be accomplished in order to achieve your objectives.  The word MUST is the operative word.  Clearly when you develop an annual plan every strategy and tactic in that plan has importance.  So, the difficult decisions you must make are what are the most important strategies that must be accomplished.  Without accomplishing those strategies, your plan will clearly fail.

Once you identify your strategic imperatives, then you need to lay out clearly and simply what you must do to accomplish each of those imperatives.  Included should be key dates by which each of these steps must be accomplished.

This exercise will help you stay focused on what you need to do to ensure success in the coming year.

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

Customer Developed Marketing

You have all heard the buzz about Customer Developed Advertising and Marketing.  There are Companies today who are clearly experimenting with this technique on a large scale.  Budweiser has a TV show called BudTV and I am sure you will see many examples of Customer Developed Advertising on this site.  Of course You Tube has many examples.  Other Companies are using Customer Developed Advertising on the Internet and on Broadcast TV.  So, good idea?  While it may be to early to make a judgement, I believe this approach holds out great promise for a number of reasons:

1.  It gets customers involved in the product or service;  The more involvement, the more loyalty (at least in theory);

2.  It opens up the creative pipeline to new and innovative ideas and approaches;

3.  It provides a unique insight into the minds of your customers in terms of how they view your product or service;

Are there pitfalls…. of course there are.  The big one will be how “rejected” customers will feel.  In addition, ensuring that anything that is ultimately used is consistent with your product/service positioning is critical.

So, my vote goes to “try it, you may like it!”

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

This Isn’t Kansas Anymore

Do you remember when broadcast TV on a national basis was how you simply communicated your product’s message?  And, when that message was a “slice of life” commercial?  Well, in the words of Dorothy from the Wizard of Oz, this isn’t Kansas anymore!

And yet, what has really changed?  Aside from the myriad of communication options available today, the key fundamental of brand positioning has not changed.  You still need a product with a significant point of difference which meets a real customer need to succeed.  And, you still need to communicate that point of difference clearly and succinctly.  What has changed is how and where you communicate your message.  Both of these issues (the how and where) are not easy to answer and will depend upon many factors.  Every “supplier” from TV,  Cable, magazines,  newspapers, Radio, the Internet, Cell Phones, etc., all have their compelling stories of why your money would be best spent with them.  Targeting your current or potential customers through demographics, psychographics, purchase behavior, predictive analytics, etc., all come into play.  So, how do you choose?  At the end of the day, it all comes down to results.  What combination of spending will “move the needle” in terms of your objectives (volume, awareness, new versus existing customers, etc.). 

So, experiment, and use “experts” to help you decide.  But, remember that the message is ultimatly “king.”  Your products differentiation should win out in the long run.

 Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

Lifetime Value

While I have discussed this concept in a few earlier posts, I feel it is such an important concept that I wanted to elaborate further on how to apply it to your thinking.

Lifetime value is simply the “profit” your Company makes on a customer over his/her lifetime.  The simple example is if you sell Chevrolet cars and a 20 year old buys a car from you on which you make a profit of $500, that individual provides you with a potential lifetime value of $10,000.  This  assumes he/she buys a new car from you once every three years for the  next 60 years.  Of course, if that person gets married and needs two cars, then their lifetime value doubles to $20,000. 

Can this “model” be applied to all products and services?  Yes it can as long as the product/service is not a one time only purchase.  So it can be applied to restaurants, toothpaste, haircuts, computers, etc.  Yes, anything.  Obviously, the lifetime value of each product or service will vary.  But I think if you apply this concept to your products/services you will be quite surprised at the “value” of each customer.

Once you establish this “lifetime value” it brings into focus the importance of customer satisfaction.  With a high lifetime value, you need to do everything possible to keep that customer for his/her lifetime.  Improving your product/service, extraordinary service, special unexpected surprises, etc., are all ways to accomplish this task and I have talked about many of these in the past.

The key is keeping your customers loyal to truly see the benefits of their value over their lifetime.  Remember it is always easier to keep a customer then to get a new customer!

 Rich

Bizvice:  Strategy, Marketing & Entrepreneurship