Does Positioning Get the Attention it Deserves at Your Company?

My answer would be "no" based on most of the companies I’ve worked for and with over the years.  What is your gut response before reading this article?

All marketers learn about the original "Four Ps" of marketing and use them in all aspects of marketing strategy, planning, development and execution:

1. Product – deals with the dimensions of the product being marketed.  This applies to all types of 'product' – whether it’s tangible, intangible, service, practice, etc.  The product dimension addresses characteristics such as the branding, functionality, design, quality, safety, packaging, warranty, etc.
2. Price – deals with the dimensions of pricing decisions such as pricing strategy, suggested selling price, discounting, wholesale pricing, seasonal pricing, bundling, flexibility, price discrimination, etc.
3. Place – deals with the dimensions about how the product reaches the customer.  Marketing decisions on place include distribution channels, coverage, channel members, inventory strategy, order processing, logistics, etc.
4. Promotion – deals with the dimensions of promoting the product including decisions on promotional strategy, advertising, campaigns, promotions, selling, public relations, publicity, marketing communications, etc.

Al Ries and Jack Trout introduced the concept of Positioning as a key marketing strategy during the 1970’s and popularized Positioning as a core marketing discipline with their seminal book; Positioning: The Battle for Your Mind.  Since then many marketing practitioners and academics have included Positioning as the 5th P of marketing.  However, doing some quick checking around while writing this article, I was surprised to see many recently published materials, some from reputable sources, still referring to the original "Four Ps" without mentioning Positioning.  In spite of these surprising omissions, it does appear that most university curricula do include Positioning as one of the updated "Five Ps" of marketing.

So why is positioning most important?

Positioning deals with what you want to do in the mind of the prospect – i.e. how do you want prospects and customers to uniquely perceive your product in their minds regardless of exposure or familiarity with other similar or competing products – e.g. "safe vehicle" = "Volvo".  Positioning is the promise of the value you create for your customers.  Positioning cuts across the other 4 Ps and determines how you develop the specific dimensions of the other 4 Ps within the overriding positioning.

Positioning dictates what you do with a product and/or how you develop a product.  Pricing decisions must support the positioning.  Place is determined from positioning to define how to take a product to market.  Promotion is how you consistently communicate the positioning to the mind of the prospect.  If any of the 5 Ps are out of sync, your marketing strategy and execution will not produce good results.

According Philip Kotler of the Kellogg School of Management, all good marketing planning starts with Research, which reveals potential customer Segments, which determines the Targeting of specific segment(s) a company can serve better than anyone else.  The next step from this process is Positioning which must be done before considering Product, Price, Place & Promotion of marketing planning and execution.

A previous article discusses why positioning should take precedence over branding.

Where does Positioning fit in your business planning and marketing process?  Do senior management and other functional areas in your company understand and appreciate the importance of positioning before everyone runs off to build, market and sell product?  Your comments are always welcome.
Copyright © 2010 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

Targeting B2B Buyers with Occasion-based Marketing

Mention occasion-based marketing and most marketers think about B2C holiday marketing –the special offers and promotions for Mother’s Day, Valentine’s Day, Christmas and other real or fabricated holidays.

Most businesses and marketers want to improve their marketing response and conversion rates – i.e. the number of responses to a marketing campaign and subsequent conversions to a sale.  Occasion-based marketing is a proven tactic to boost response rates – people are more receptive to buy something related to a relevant occasion.

Occasion-based marketing is more than just doing promotions around holidays.  Think about the definition of occasion in broader terms:

• A particular time when something happens.
• A chance or opportunity to do something.
• A cause or reason for something.
• The need for something.
• The need to do something.
• An important or special event.

Using these broader definitions, think about what occasions would make your prospective B2B buyers more receptive to buy and/or respond to your marketing campaigns:

• News – look at current news topics and who is paying attention.  Is there any relevance for your offer and the audience that you can leverage?  For example, if a group of businesses are paying attention to carbon tax legislation, do you have relevant products or services to position and offer to take advantage of this news and attention?
• Events – there are all sorts of events happening all the time – which of these events may make buyers more receptive to buy or consider your product/service/solution?
• Holidays – although this is most visible in B2C, consider where your product/service/solution may fit in the value chain.  For example manufacturers have to supply distributors who supply retailers in anticipation of a future holiday promotion.
• Associative – we drink orange juice with breakfast, wine with dinner at restaurants and sports drinks when we exercise or play sports.  Why?  Because marketing has made us associate these products with these occasions.  Are there opportunities to associate your product/service/solution with an occasion?
• Business Cycle – businesses have cyclical occasions that present occasion-based B2B opportunities.  For example, when they do budgeting is a good occasion to get your product/service/solution in their budget plans for the following year.
• Customer Occasions – such as management changes, mergers, acquisitions, new product introductions, business expansion, etc. are opportunistic marketing and sales events.

This is not an exhaustive list of all occasion-based marketing opportunities.  The key to successful occasion-based marketing is to find targeted and relevant occasions when prospective buyers are more receptive to buy your product/service/solution and respond to your marketing campaign or promotion.

Cyclical versus ad-hoc or unplanned occasions – it’s straightforward to schedule marketing campaigns and promotions for cyclical occasions.  Do you have the means to respond quickly and appropriately to relevant ad-hoc or unplanned occasions?

Consider occasion-based marketing as an overlay to your previously established market and customer segments – it adds timing and positioning dimensions for executing campaigns and promotions when buyers are more motivated and receptive to buy.  Try a test to compare response rates between a regular schedule-based approach versus occasion-based for the same marketing campaign or promotion.

Have you had success or otherwise with occasion-based marketing in B2B situations?  Your comments are always welcome.
Copyright © 2010 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

How Much Should Analyst Surveys Shape Your Marketing Strategies?

I recently reviewed the results of the 2010 Gartner Executive Programs (EXP) survey of CIOs who influence $126bn of IT spending in 41 countries and 27 industries.  Besides the headline that IT budgets in 2010 will be at 2005 levels, there are some interesting changes and trends that B2B IT and business software vendors and marketers should consider.

Enterprise applications (ERP, CRM and others) is not a Top 10 business or technology priority in 2010 – this is a startling finding and dramatic change from previous years.  Enterprise applications were the #2 technology priority since 2007.

After being the #1 technology priority since 2006, business intelligence applications have dropped to #5.

Business process improvement continues to be the #1 business priority – this has been the #1 CIO business priority every year on this survey since 2006 (the earliest edition of this survey I could find).

Virtualization, cloud computing and Web 2.0 are the top 3 technology priorities in 2010 – while this may not be a big surprise to most people in the industry, it is the first time any of these technologies have appeared in this Top 10 survey.

So this got me thinking about the relevance of these surveys for influencing product, marketing and sales strategies:

• Are vendor marketers paying attention?  Given that ‘business process improvement’ is the #1 business priority for CIOs since 2006, one would expect this to have some prominence for relevant vendor marketers.  Looking through the websites, collateral and marketing campaigns for several business software vendors, there’s scant direct attention to the business process improvement value proposition.  While it is mentioned within other propositions and contexts, it doesn’t have the headline attention or prominence for vendors that one would expect for the #1 business priority of potential buyers.
• Should vendor marketers pay attention?  Considering the scope of this survey and the influence of the respondents on buying decisions, it would seem logical that marketing and selling to these priorities would yield better results.  Although the reality for actual buyers that transpires during the forecast period may not exactly match what they indicated in a particular survey, the priorities and trends in surveys provide good directional information for connecting with buyers relative to their top-of-mind interests.
• Which survey(s) do you pay attention to?  While this is a good survey from a reputable source, it is just one of dozens or possibly hundreds of good surveys from many reputable sources published each year.  Relevance to your markets and industry are obviously critical.  Aggregating results across multiple relevant surveys may provide a more balanced perspective.

While these types of surveys do provide valuable insights for market trends and what concerns potential buyers, they should be considered as just one of a number of inputs for shaping marketing plans.

How do you use surveys to shape your marketing strategy, campaigns and programs?  Have you seen beneficial results from paying attention to these surveys?  Your comments are always welcome.
Copyright © 2010 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

Key Decisions That Determine Whether B2B Buyers Will Buy From You

Last week’s post discussed the 3 reasons that motivate B2B buyers to find and consider buying a product / service / solution:

• Solve a problem
• Pursue an opportunity
• Improve performance.

In this article we’ll look at what the key decision factors are that determine whether they buy, what they buy and who they buy it from.  Based on work I’ve done over the years reviewing countless win/loss analysis reports from thousands of deals, there are always 3 key decision factors at play that determine what a buyer decides to do:

1. Meets their needs – B2B buyers set out to find something that will enable them to pursue the goals they have established based on one or more of the 3 primary motivators and supporting objectives.  While this may be intuitively obvious to anyone who has been around B2B marketing and sales for any time, meeting the specific buyer needs based on their buying motivators and business goals is the #1 reason that determines which product / service / solution they buy.  These needs are frequently expressed as lengthy lists of requirements, Requests for Proposals (RFPs), demonstrations and other nitty-gritty details for vendors to show that their proposed solution will meet the customer needs.  While it is possible for vendors to influence some of the specifics to suit their solution, the ultimate decision is still whether the buyer believes a specific choice will meet their needs.
2. Affordability – the most frequently mentioned reason for a deal loss from salespeople is price, but affordability for buyers is much more than just the price of the product / service / solution.  Firstly, many B2B buyers usually have underestimated expectations of what they are willing to spend to pursue the goal of the buying motivators.  Secondly, it’s more than just the purchase price – it’s the total cost of ownership over the projected lifetime of the solution.  Thirdly, it always boils down to ROI – buyers determine the value to the business for achieving the goal they identified based on the buying motivator(s).  From a vendor perspective, the discussion with the buyer should be more about value creation for the business and less about the actual price.  If you create the right value for a business, the price becomes incidental.
3. Trust – while this is not an overt discussion topic like needs and affordability during the buying process, it is a significant influential factor that determines who a buyer buys from.  All things being equal in meeting the needs and affordability factors, buyers will choose the vendor and people they most trust.  I’ve seen cases where buyers don’t choose the best fit and most affordable option because they don’t trust the vendor and/or the people representing the vendor.  Salespeople usually put a lot of effort into building a good rapport and trust with buyers.  Trust extends to every aspect of a vendor company and all the vendor people all the buyers deal with.  Building trust with buyers should be a major objective for all marketing, sales, consulting, management, support and other interactions.

Sometimes B2B buyers decide not to decide and defer buying to some undetermined future time.  When you delve into these cases, the reason for the non-decision is probably because one or more of the above 3 decision factors wasn’t met.  The buyer doesn’t believe they can achieve the goal of the original motivators and decides against proceeding.

Vendors can significantly improve their marketing and sales performance by understanding and focusing on the 3 motivators that initiate the buying process and these 3 key decision factors that primarily influence the buyer’s decision of what they buy and who they buy it from.

Your comments are always welcome.
Copyright © 2010 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

The 3 Reasons That Motivate B2B Buyers to Buy

An interesting (more like disconcerting) observation from some of the work I do is the dichotomy between Information Technology vendors and buyers on why a customer buys a solution.

IT vendors tend to focus a lot on the features and functions of the solutions, their claimed technology leadership, their innovations, and how they are better than the competitors. It’s all about them and how wonderful they are and how wonderful it would be to be their customer. While these might be selling points worth mentioning, they are hardly the reasons most buyers decide to buy.

When I talk to vendors, a lot of the discussion centers around who they can sell something to and how to best go about marketing and selling it to get buyers. When I talk to IT users and buyers, they’re primarily concerned with creating value for their company. Buyers frequently need help interpreting the vendor gobbledygook and vague statements into what a particular solution actually does and how it can create value for their business.

Based on what I’ve seen and experienced over many years in the IT industry, there are three fundamental reasons that motivate IT buyers to buy a solution:

1. Solve a problem – something is wrong or not working properly in the business that seemingly cannot be resolved with the processes and technology they already have. The scope of the problem can be in one or more functional areas or across the company. The scale of the problem may range from a serious detriment to an annoyance. The scope and scale of the problem determines the urgency and budget to resolve the problem.
2. Pursue an opportunity – companies find new opportunities to expand or grow their businesses beyond their current confines. In many instances these opportunities require new or additional business processes and solutions (e.g. a manufacturer adding an aftermarket service center) that they currently don’t have. The scope and scale of the opportunity determines the urgency and budget to buy what is needed to pursue the opportunity.
3. Improve performance – it could be argued that underlying every buying decision a business makes is a goal to improve performance. That’s true, but businesses do have specific performance improvement initiatives such as decreasing inventory investment or reducing days sales outstanding (DSO) that may require the acquisition of specific solutions and/or services. The scope of the performance improvement goal can be in one or more functional areas (e.g. reduce overtime wages in the service department) or across the company (e.g. increase operating cash flow). The scale of the problem may range from imminent demise if not fixed soon to a long range continuous improvement process. The scope and scale determines the urgency and budget to buy.

While all three of these buying motivators could be present in many situations, there is usually one primary motivator. Look for the primary driver and primarily focus on that, but don’t overlook the importance of the other one or two secondary motivators to support the buying decision process.

Marketers and Salespeople can significantly improve their odds of finding and converting suspects and prospects into buyers by paying attention to these three reasons that motivate buyers to buy and by connecting with prospective buyers based on why they want to buy.

In my next post, I’ll explore the next step for buyers – the three reasons that cause them to finally decide to buy and who they buy it from.

Your comments are always welcome.
Copyright © 2010 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

Does Your Marketing & Sales Engagement Sync with the Prospects Interests?

Despite highlighting this problem for many years, I’m still regularly dumbfounded when I see what Marketing and Sales organizations do when they engage with prospective buyers after they’ve expressed interest.  This practice regularly exasperates buyers, and I would contend that it’s a major reason buyers look elsewhere after expressing initial interest in a particular company / product / service / solution.

This is the type of scenario that leads to the problem I’m referring to:

• Marketing formulates an appealing value proposition for a target market segment
• A marketing campaign uses typical awareness programs such as white papers and webinars to create awareness and attract prospective buyer interest
• A prospective buyer sees this, the specific value proposition connects with their needs and they express interest by responding to the call-to-action for the marketing program
• Marketing immediately get the prospect into their marketing database for follow-up
• Marketing assign a tracking identifier to designate which campaign / program / webinar / landing page / offer / etc. originated this lead
• The marketing lead qualification and nurturing process kicks in – usually based on a set of standard scripts and progression steps to eventually get a qualified lead to Sales.

But what does marketing do with the tracking identifier that links to the specific value proposition which is the key reason why a prospect expressed interest?

• They primarily use the tracking identifier to analyze the effectiveness of a campaign / program / webinar / landing page / offer / etc. to determine what’s working and what they should continue doing, change, update or drop.
• However, what many marketing organizations fail to do sufficiently is to use the tracking identifier to determine how to specifically engage with each prospect relative to their specific needs – the reason they expressed interest in the first place.
• What is frustrating for buyers is that they see a great value proposition and offer that attracts their attention, but when they express interest they are dumped into the generic marketing sausage factory.

And what happens when Sales get the qualified lead?  The tracking identifier might be visible, but is there anything to highlight what it means and identify how sales should specifically engage with each prospect relative to why they expressed interest?  From what I’ve seen over the years, sales tend to pay insufficient attention to this – they jump on the lead and use the standard selling cycle process to engage with prospects.

The buyer’s perspective and interests get lost in the internal marketing and sales processes.

And what does this look like from a prospective buyer’s perspective?  Put yourself in the buyer’s shoes.  The buyer expresses interest because a very specific value proposition attracted their attention, but the engagement process with the vendor is mostly based on the vendor’s processes and perspective to eventually get a sale.  This is downright frustrating for buyers and makes vendors look incompetent because they can’t connect the dots between why the buyer expressed interest and how they engage with the buyer.

It’s a buyer’s market; the buying cycle takes precedence over the selling cycle.  It’s tough to find prospects and convert them into sales – improve your conversions by paying attention to how your marketing and sales organizations engage with buyers relative to their expressed specific interests.

Your comments are always welcome.
Copyright © 2010 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

Are You Selling or Facilitating Buying for Customers?

We all know when we’re being sold to – whether it’s a straightforward advertisement, or a clever marketing campaign, or a salesperson going through their shtick.  How do you like being on the receiving end of this process?  Most of us dislike the process, but we have to play the game in order to get the information we need to ultimately make a decision that is right for us.

It’s not that we don’t want to buy, in too many instances it’s that we don’t want to buy in the manner we’re being sold to.  We’ve all experienced this frustration and possible annoyance as a consumer or business buyer.  But why do so many marketers and salespeople, especially in B2B and Information Technology, still persist with this selling oriented approach?

Ask most marketers how they approach marketing to prospective customers and you’ll hear a lot about market segmentation, demographics, value propositions, campaigns, lead tracking, lead qualification, etc.  Ask most salespeople how they approach selling to prospective customers and you’ll inevitably hear about the various stages of the sales cycle and all the predefined processes to move the buyer through each stage to closure and purchase.

Now ask a prospective customer how they want to approach buying and you’ll hear about their reasons, specific requirements, expected results, risk, trust, proof, competitiveness, etc.  Prospective buyers have their own buying cycle of what they need to accomplish in order to make a purchase decision.

So we start with an inherent conflict of interests and processes:

• Prospective buyers have an approach and buying cycle they need to get through before making a decision
• Marketing has an approach and process of finding possible buyers and converting them into leads for Sales
• Sales have a selling cycle and predefined processes to take a lead and convert them into a buying customer.

And we wonder why B2B and IT sales cycles take so long.  Consider all the wasted time, effort and resources on both sides because the selling process is not aligned with the buying process.

Marketers may point out that there are specific buyer-oriented value propositions in their marketing campaigns.  That may be true, but the pitch and process is still mostly focused around the seller and driving leads and statistics through their marketing processes.

Salespeople may point out that they find out what problems and pains a specific prospect wants resolved and then align the sales process accordingly.  That may be so, but from I’ve seen, more often than not it’s more like a “show me your nail and I’ll show you how our hammer will do the job better for you” approach.

“He who buys had need have 100 Eyes, but one's enough for him that sells the Stuff.” ~ Benjamin Franklin

How are you marketing and selling to customers?  How and why do prospective customers want to buy from you?  Consider how you can move from a vendor selling approach and rather facilitate prospective customers to buy from you.

Your comments are always welcome.
Copyright © 2010 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com