Keep marketing in bad times and good

Exhibitions make a big call on marketing budgets once space, design, give-aways, shipping costs, travel, accommodation and entertainment are factored in. Not to mention the time and organisational effort that prevents other marketing work being undertaken for a while. And yet it is rarely challenged by senior management. Not considered as an economy in difficult times. Interestingly it is seen as a potential economy by visitors. No, the reason is simple - fear of competitive gossip if the company does not exhibit. Interestingly recent research reported by Marketing VOX has discovered a similar sentiment with respect to advertising - or lack of it. "More than 48% of US adults believe that a lack of advertising by a retail store, bank or auto dealership during a recession indicates the business is likely struggling, according to a study from Ad-ology Research." Although it may seem a negative driver, continuing a strong marketing presence during a recession can be a very positive response. But only if the marketing investment is carefully targeted, co-ordinated and relevant to achieving the business plan. During difficult times the marketing plan may need to be reviewed, priorities changed and tactics refocussed, but even in these unprecedented times businesses are still trading and customers are still buying. It is easy to believe that everything has stopped. It hasn't.

Marketing by numbers

One marketing guru states without reservation that unless you are using at least 8 different marketing techniques then your marketing strategy needs an overhaul. He likes numbers - elsewhere it is 3 golden rules. Perhaps there are more pieces of advice reduced to a simple numeric headline. Of course this in itself is a good marketing technique - suggesting that there is a formula for success by following a prescribed series of steps. And of course it makes good attention grabbing headlines too. Of course the marketing practitioner has a range of techniques that can be deployed but it is not to say that because they all exist they should all be used.  A physician does not use every drug available but prescribes medication to address the diagnosed problem. Just because a business can advertise it doesn't mean that this is also the best use of the marketing budget. It is convenient to use metrics such as, the marketing budget should be set as a percentage of sales turnover. But consider two client examples where this was applied to divisions of large multi national businesses. In the first example the division had a significant turnover but only a few customers because in that business sector there were just a handful of players. But they had an advertising budget and wanted to run a campaign to use the budget. But this would have been unproductive - they knew all their customers and prospects already. Other marketing techniques to develop and sustain customer loyalty offered better returns. The second example was a company  where budgets were aligned to product sales. Again a problem because well established products enjoyed significant funding whereas new products that could in time evolve to replace these cash cows were underfunded. So the lesson is to devise a budget that is driven by a marketing strategy that in turn is designed to meet business objectives.  Marketing by numbers can obscure that goal, but marketing analysis can shine a light onto the real issues and indicate where budget should be invested.

Build it and they will come

Just over 9 years ago the so called 'dot com' bubble burst wiping trillions of dollars off the valuation of NASDAQ listed companies, many of them internet sites without any discernible business model or source of funding other than investment funds. Back then terms like 'cash burn' were employed to describe the rapid eating up of the investment, typically venture capital, consumed by paying programmers, designers and the rest to build and develop the sites, not to mention expensive advertising on prime time TV, newspapers, magazines, bus sides and the Underground. Then many of these companies propelled to prominence and excitedly  discussed in the press started to go bust in a spectacular fashion. Rather like the movie - Field of Dreams where a baseball field was built in  an Iowa cornfield in the belief that build it and people will come - the site would somehow attract visitors. And they did - by the millions, because it was free. Any hint of paying a subscription and the visitors were off to the next new thing. The vague business plan seemed to be to to build the site, build big audiences then leverage this package to advertisers. The truth is not many made this work. Fast forward to the Web 2.0 era and we see social network sites building big audiences and now trying to recoup the huge investment. But changing the site's look to carry advertisements or charging subscriptions and the users object or take their interest to new contenders who are still at the traffic building stage and perceived as cool and new. Co-founder of Twitter Biz Stone is supposed to be announcing how Twitter can generate a revenue stream and turn a profit out of its micro blogging service - or will it be sold? Then there is Facebook and the issues raised over changes in terms of service as a step towards targeted advertising based on user profiles cause a climb down. Typically venture capitalists are interested most in exit strategies rather than long term stake holding. In other words, get the venture going and take a profit from selling the stake. In b-2-b marketing we always start by taking prospective clients back to the business plan so together we can test its robustness, then derive marketing strategies and marketing communications campaigns. Not the other way about of building a brand and product without actual paying customers or advertisers to generate a revenue stream and profit. 

Personalised automated messages

An e-mail report arrived purporting to show how our agency profile "is doing" on an advertising industry database and went on to explain that we were currently recipients of their " Enhanced Agency Service" free of charge and not only did this afford the greatest exposure but they were proactively engaged in marketing our services using both online and offline channels. With great anticipation I scanned the report of visits to our page and click thrus to our site only to discover that despite all the great efforts apparently freely undertaken on our behalf, all figures were a big round zero. Ah! This eventuality was apparently anticipated and a zero return may be explained and rectified by updating our profile page. But guess what - there was no profile page or any mention at all of our agency on the site! This communication was presumably the output of some automated device and suggests that nobody had checked either the results which would hardly persuade us to actually pay for this service, or indeed if we were actually listed in the first case. This type of communication whilst posing as a personalised e-mail is actually less effective than a clearly widely broadcast message about a product or service. The main proposition that the owners of the database were selling was their enhanced listing so surely the first step is to provide some evidence that this has worked better than the basic free listing. This of course will take some time and human intervention, but should result in not only a genuine list of prospects but some understanding of how the 'trial' has performed. The new list will probably be shorter - if the rest are like ours a zero return it might instead prompt a review of the service itself - and better targeted. Relying on an automated system to generate sales misses the whole point of actually knowing who your customers and prospects are.