A Pragmatic Introduction to Essential Components of Modern and Old-fashioned Marketing
Ulrik Rasmussen
Growth | Sales | Execution | Strategy | SaaS | Retail | Manufacturing | M&A | Finance
This article is based on some of the ideas, methods and concepts I have contemplated when judging marketing efforts and devising or revising marketing strategies in various companies.?
This short essay is not an exhaustive article about all the ins and outs of marketing, however it contains some vital elements for any marketeer to ponder.
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Introduction
"Mundus vult decipi, ergo decipiatur."
Source: Pontificem Scaeuolam, from? Augustine of Hippo, City of God, chapter 27
In this article the basic principles of business to business marketing is presented from the top down, however not exhaustively. It is a partial description of the full marketing mix, which will enable any company to get started - or to improve on already established principles and execution.
Marketing - the objective
The goal of all marketing is first and foremost to generate growth in turnover and thereby growth in results. So simply put marketing is a tool to attract new customers and to get existing customers to buy more. Therefore marketing is not solely a discipline in creative crafts, but it is actually a laborious task of work, establishing and fine tuning tools to generate growth.?
So attracting customers and growing sales are the main objectives, and this will be achieved through designing a marketing strategy which should be executed from a marketing plan, which then will result in a series of actions that will produce results, which are then improved and reiterated through trial and error (or trial and success) - and in the end maybe revising the strategy from the results observed, and then iterate again.
Marketing Strategy and Execution
The marketing strategy is a description of how the business will attract prospects, i.e. potential future customers, to the business and how to convert them from prospect to customers buying the products from the business.
The essential component is the value proposition of the business, i.e. what is the value that the business creates for the market i.e. its customers. This should be supported by some unique selling points (or unique sourcing points, i.e. the customer focus), that is some USPs. These are entailed in the part of the value proposition that sets the business apart from the competition.
Also pricing, product, place and promotion, the 4 Ps that is, should be part of the strategy.
All this is then accumulated in a marketing plan, which should tell exactly how to achieve the strategy.
In essence the preparation for compiling the strategy and making the plan is the hard work, and this is an iterative process, where especially the competitive situation, value proposition, unique selling points and demands from customers not met by the current product portfolio should be addressed in detail.
Also many businesses have multiple products which are not entirely overlapping. It may be that the plan for product A is totally different from product E, so it will get somewhat complicated as all planning essentially is. The best advice is to keep it high level and agile, and in addition keep it as simple as possible, so that the actions that go with the plan will be easy to plot and perform.
In the plan you can use outbound marketing, inbound marketing, direct sales through sales materials, account based marketing etc.
However you will always need to produce content around any of these methods, and you will likely use all of them to some extent.
This means that content, marketing campaigns, conversion (website or other media), SEM, SEO and communication of USPs will to some extent be relevant whatever strategy and methods you apply (at least in the past 20 years).
USP’s are what needs to be put in front of the potential customer - by what ever means works best.
The Purpose of Marketing
Claud C. Hopkins starts out his famous book in this way:
“The time has come when advertising has in some hands reached the status of a science. It is based on fixed principles and is reasonably exact. The causes and effects have been analyzed until they are well understood. The correct method of procedure have been proved and established. We know what is most effective, and we act on basic law. Advertising, once a gamble, has thus become, under able direction, one of the safest business ventures.” (Source: Claude C. Hopkins, Scientific Advertisement, 1923)?
It should be safe to assume that most people engaged in marketing today, would rather characterize marketing as a non-exact science moving towards an art. So Mr. Hopkins may well have been right back in the 1920’s, but this is so no more.
Due to the fast changes and development of society, communications and technology, what worked 5 years ago will not necessarily work today. And thus if there is an established “correct method of procedure” that has been established; it is at maximum the right method of trial and error to ascertain what does actually work in the context of your particular product and your particular audience (and your time). The methodology of what to do in respect of that huckster-method, is albeit rather constant.
Trial and error is the only constant in the “science” of marketing
However Mr. Hopkins makes a point in the outset of chapter 2, which has not faded with time, and which is as pertinent today as it ever was:?
“… The only purpose of advertising is to make sales. It is profitable or unprofitable according to its actual sales. It is not for general effect. It is not to keep your name before the people. It is not primarily to aid your other salesmen. Treat it as a salesman. Force it to justify itself. Compare it with other salesmen. Figure its cost and result. Accept no excuses which good salesmen do not make. Then you will not go far wrong."?
(Source:Claude C. Hopkins, Scientific Advertisement, 1923)?
What a very great number of professional marketeers neglect is to follow-up on the results, and follow-up in a rigorous and thorough way.
The proof is in the effect on sales, which is not always easy to ascertain, and in addition you need to follow-up on the activities and metrics that show you if you are on the right track to generating sales.?
ROI is king in marketing, but the road to fulfillment is often long, and therefore you need intermediary results along the way, so as to make sure you are on the right path to ROI.
The purpose of marketing is sales, increased sales and growth
So this means following up on website traffic, channels to website traffic, marketing campaigns, spend, leads generated, lead channels, SEO search ranking, conversions through the funnel, brand awareness, market penetration etc. Having a good overview of all these metrics and more is what enables you to set the next strategy right and execute it with good results.
If you follow-up in detail on your results, this will also set you in a position to learn and improve. In the end all the recorded “causations” and results will be the feeding mechanism for your future more successful marketing strategy.
From the military it is a rule of thumb to use the last 5% effort to debrief. I.e. to find out, what actually happened, what went the way it was supposed to, what did not go to plan, why these things happened - i.e. to find the causes, and then to learn from them and apply to future planning and execution.
However in business almost no-one cares for this process, and that will make you do the same mistakes again and again and not improve your results - and when no-one measures the results anyway, then you are also not held accountable. However if you perchance are a moral individual, who cares about delivering results for your wages and giving the owners return on their invested capital, or you are working for your own capital - then both measuring results and improving them is important.
Content - the goal
The following is intended for a business to business context. For the end-users and the consumer market, this becomes much more a magic art of deceptive persuading through the manipulation of the emotions. That is also an interesting topic. The BtB framework is however similar in the basics to that of the consumer market, the packaging and path are just very different.
As the goal of all marketing is first and foremost to generate growth this has some impact on how to view content.
The goal is to make content that is personal to the receiver, which will make him read the content and also more likely to act upon it, and thus the channel needs to be highly targeted. In addition the content should be delivered in-time, i.e. at the exact moment when it is needed by the receiver or potential customer.?
According to John Dawes in “Advertising effectiveness and the 95-5 rule”, only 5% of the potential customers you reach will be in the market for any product at all. This is not a scientific paper that proves the point, however it is a good framework to think about reaching potential customers. You can only reach so many who are in a buying mode - and you should do more to prepare potential customers who will be in the market in the future. So this is a case for branding, or perhaps even more to educate your future potential customers with valuable insights - or maybe if possible even both simultaneously.??
So this calls for an evaluation of the maturity of the “lead”, which can be done from the form of advertisement he reacts upon, from where he acts on a website, i.e. how deep is he in the site, what is he reading about, what has he done before etc.?
This is easier said than done, but it pays to have this framework in mind, when working in practice with lead generation and moving the potential customer through the funnel.
“Do you love your mother or your wife - you need both marketing and sales.”
(Source: Dan Tyre -Inbound2Grow)
Make it easy to share content, i.e. highlight quotes of central points and of generic relevance, this will both make it easier to disseminate through social media and also give the reader easy points to follow when skimming your content.
Ease of use and share is a must on Social Media and any other media
Reach
Reach is the most important for gathering leads, if your content is good. I.e. getting out to a lot of people increases the likelihood of more people reading your content, and also to convert more people deeper into the funnel. If you do not have reach you have nothing - i.e. you have nothing to work with and from. Exactly like sales when running a business, when you have a high turnover, you have something to work with - cut costs, optimize production, run efficiency plans, throw out marginal customers / business, optimize contribution margin etc. etc. The same goes for reach. When you have a big audience you can work with your content, your approach, your topics, the depth of content, the popular versions vs. the technical versions, awareness vs. conversion, focus the audience through filtering, etc. etc. So reach is king.
Cash is King, but Reach is the King until then
However you will also need to reach the prospects which are ready to buy or ready to start the buying journey, so that you actually reach people who are interested.?
"Tell the truth, but make the truth fascinating."
(Source: David Ogilvy 1963, Confessions of an Advertising Man)
So how do you get high reach? To get that right in a simple formula; that is the 64.000 dollar question.
You can increase spend, and in any campaign the more you spend the more reach you will get, when you start from nothing. However the reach will trail off at some amount of spend, i.e. you get less and less effect as you spend more. However if you pursue a strategy where you do not spend more, how then can you get higher reach? You can produce organic, good content that spreads itself, i.e. content that is so good that it attracts the audience by itself. This is no easy task. However this can be achieved if the good content is delivered in quotes or comments or graphics, which is made highly easy to share - as long as the SOcial MEdia platforms and digitization as we know it continues. In addition the SEO-efforts you worked out and executed consistently over the years, will make your organic reach increase over time, even if it is a long term strategy.
The shareable content also typically needs to be provocative, or simply have nothing to do with the business in the outset, i.e. communicate something funny or moving - you will easily get the drift scrolling through any SoMe feed. People are gullible and SoMe lives on lowbrow content, however the trick is to find the right way to pitch your business into this morass.?
And also remember the wise words of Ogilvy “The customer is not a moron. She’s your wife”.
"The customer is not a moron. She's your wife"?
(Source: David Ogilvy 1963, Confessions of an Advertising Man)
You are talking (at least in a BtB context) to an intelligent person, with at least average intellectual faculties. So you can expect your audience in their ground values to want to be informed, make good and cost-efficient decisions.?
So if you attract such a person's attention and you have something valuable to communicate in the context of their decision making in a business context - then you will make a favorable impression and if they are in the buying mode, you will get your meeting (if your call-to-action is done right), and you can pitch your full value proposition.
So remember Ogilvy’s statement, and make content that will educate your customer, not only in the direction of your own products, but educate him in the decision environment he is placed in.
Different levels of content
Have you ever heard from a business unit, that the customers and market are very conservative and they all know all there is to know about the business? I.e. there is no need to explain your product, there is no need for USP’s or value propositions, as the market and the customers are highly capable.?
Levels of content, learning and audience
This might be true, however it also might be that when you communicate in a way that only a highly capable and technical audience would understand, then that is the only customer audience you get - and in addition you only onboard very few customers.
So it could be a self-fulfilling prophecy.
New buyers and decision-makers arise all the time in the target group for any business - people shift companies in the same job function, people get promoted in the same company, people get promoted from one company to a higher position in another company, and people even shift from one industry to the next.?
In this process there will be potential customers, i.e. employees, who are not familiar with all the knowledge in either the industry, or the products which they need to source. I.e. here you have a possibility for educating the customer, even in a highly technical business with a conservative market. In addition you need to start out with the obvious, you need to cover the basics, and work your way up. The novice in the workplace will appreciate an introduction and basic concepts, even if he is highly skilled in a different area, as this will set him in a position to quickly get to the central points of the topic. He is then gaining experience and knowledge in the process of engaging with you, which is exactly what you want. For the expert the basics will just be skimmed or scrolled past - or at least you should build your campaigns, website, SoMe platform, papers etc. in a manner, which facilitates this.
This calls for different levels of content, i.e. the basic and obvious information that puts your products into context and explains how the industry works, why you need the products etc. Then there will be a need for specifications of your products and finally a deep dive into different areas of the product, really being technical and perhaps perspectives on further developments and applications. This could also be generic information pertaining to your product but not describing the product itself.?
En modelling of 3 levels of content
These 3 or 4 levels of content could be 5 or 7 levels instead depending on your business and how technical it is.
5 levels of communication and content
Do you need all 5 levels? Yes you do. There should be a progression of content, and also a mix of technical difficulty, as mentioned before.?
All the highly skilled buyers can simply skip over all the introductory content you provide and go to the core of your value offering.
These levels of content can also be supplemented with different types of content appropriate for various levels of content, i.e. creating a matrix combination of different levels with different types.
Types of content appropriate for the deepest levels of content could be white papers, ebooks or scientific articles. However infographics and video content might do better with the light content.
Over and above, even when you produce the most highly advanced content, you should mix in some of the lighter types of content - even very complex problems can benefit from a table, a diagram or a picture.
A Pyramid of Content Marketing
So the content levels should be paired with the content types. This could be setup in a matrix, however the need is mostly to have this as a mental reference framework, when you think about campaigns, sales materials, websites etc.
So you can use this as a guideline, and try to fill out the spaces you think needs filling. To mix these properly is no easy task, and some marketeers are so artful that they can even put all 5 levels into any content. Trying to sell in a white paper, would normally come off as tacky, however subtle calls for action might be indirect and accepted. This will depend on the audience, and the correct level is notoriously very hard to determine, even by trial and error, as truthful feedback is hard to come by.
The product and its importance
Having great content that interests your potential customers and making it interesting enough to share and help them through their journey - that will amount to nothing, if your product is not good.
Customer Success will create Retention which will in turn create Value for your business.
The implications for Product Management are many, and the product is vital for how successful your marketing can be - if you have an inferior product, your market position will eventually fall, as the bad market reputation will catch up.
Some products have a value proposition, but have no uniqueness whatsoever. I.e. all products in the marketplace can do the same, and some can do more, or bring the customer more value in every respect.
This is an unsolvable puzzle for both marketing and sales, there is no way to win.??
Marketing Audit
Once you have put together a marketing strategy, and you have executed to some degree, by creating campaigns to your well-thought-through website with good call-to-action items and hightlighted USPs,? and you have content on SoMe and other places that is great and helps your potential customers - then the time has come for improving or changing direction.?
A tool that can help getting started with this, or help to restart the journey if you are in an old running business, that is the marketing audit.
A marketing audit consists of auditing the activities executed. I.e. by example search for your company on Google and see what comes out, and score the result 1 to 5. Do that regularly - a few times a year or every quarter.
The 3 most important USPs should stand out in the search results themselves!
This could also be done for the most relevant search words in SEO and SEM, just to check if things are working properly.
This has limitations and complications, i.e. searching from a “clean machine” (incognito helps some) and from a country or IP that is in different target groups. There are VPN-tools for these purposes, however it will take some effort to prepare and work in this way.
A way to follow competitors is to do a re-engineering of their marketing using exactly this method as well as many other tools that rank your SEO, SEM, mentions in media, your reputation in SoMe etc.?
This approach to competitor re-engineering should be applied rigorously towards your own company, so that you can find your own blind spots and identify the areas of improvement.?
A good competitor analysis is always a good ground to build on, and an audit in this manner could serve as a first step.
Keywords - SEO and below the fold
Going further into to the details SEO is important for your customers ability to find you, when they are actually in the buying mode - this is when converting a lead to a customer is easy, and some argue the only time it can be done.
The “saying“ goes that page 2 is dead. This refers to the old categorization in above or below the fold, ie. when a newspaper is folded, only that which is above the fold can be directly seen or read - the custom back in the day being, to leave the side up, where you can see which paper you are looking at, i.e. the name of the paper from the top.
Now in the digital age page 1 is considered above the fold, as page 2 is in fact both a scroll and a click away.?
However you may actually be below the fold even if you are on page 1. The deciding factor is how much content the top 1, 2 or 3 on page 1 has in their search-results. This can to some degree be tracked using pixel-tracking (i.e. how many pixels is shown in the first screen, and tracking that in relation to your placement in results). But in effect you will see this from your results on organic and paid traffic - there is no reason to make a kabuki out of it, when the problems or the results are directly visible. However the above or below the fold framework is a good tool when investigating why a strategy is not working.
Implementing some online tools for ranking keywords is a must, and this also applies to combinations of words to buy into - this should be done with logic and business understanding in the outset. However doing a long list to start from will help also with the creativity of combinations.?
Looking at the competitors through ranking tools will also help you get creative as to what terms and phrases are not overcrowded and thereby inexpensive, which might qualify them for cost-effective means of attracting the relevant audience.
Above or below the fold has now also been identified with tools using pixel-tracking, i.e. to identify exactly if you are on not only the first page, but also on the visible part on the screen of the observer, without scrolling. This is a “science” in itself, and the consitencency of different methods vary. Using this method in combination with other tools when you are dissatisfied with results is worth a try.
A more indepth examination into the concept of above the fold, will be handled later.
2 examples of advertisements above the fold
Skyscraper method
Further in the line of optimizing your strategy and execution, you can make great content or improve your already existing base of content, by looking at your competitors.
The Skyscraper Technique is an example of this, where you are not only using content and topics from competitors, but you aim for improving the content, so that you are in fact the authority on the subject online. You will then stand out.
This is in itself a good approach.?
However to perfect it, you need authority, ie. by example using link-building. If your content is linked to from a lot of credible sources, you will rank better on google (and other search engines).
I.e. you should find a relevant piece of content with a lot of back-links, then you should use that as a starting point, and build on it, until it becomes much better than the original. I.e. you will become the one that stands out, both in relation to quality and in relation to ranking on search engines. As a last point you should make all those linking to the original content aware, that there is more authority in what you have produced - so they should really link to your content instead.
Interactive content
Using content that interacts with the user or prospect will oftentimes engage more. However there needs to be clear calls-to-action when you use polls, tests or quizzes, and the results should direct the reader to conclusions about their own business as well as your products.
In addition it is important to remember that the content should bring the customer further in the journey towards buying. So not just any kind of content will do that - engagement is not per se equal to a valuable movement further in the customer journey.
Also empty engagement can backfire, as the audience grows tired of the entertainment, which is not bringing real value.
There are a lot of issues to consider in this area. You can in SoMe as well as on websites or other places make the content gated or open, and the CTA’s more or less obvious. There are positive and negative sides to any choice, and in the end trial and error is a good way to find out what works - and even then, what works today might not work tomorrow.
Customer Success
It is crucial for marketing conversion and your content overall to work well, for converting potential customers to actual customers who will actually buy your product, that you:
If you have all these features, and if the ease is truly there, then this will also be a powerful element in your marketing. Just compare with your competitor's product lacking these essential elements, which many do, as your monetization of your product (especially SaaS) will depend on setting some stops to these elements.?
I.e. you earn by retaining paying customers, so then you make it hard for them to figure out how to cancel and leave, you make it difficult to contact you to save money on providing help for your customers, and to make it hard to cancel ‘in person’. Some might after their initial success make it hard to figure out how to sign up for the free version, without signing up for the trap of having a credit card attached to the account, which you then have to cancel.
领英推荐
If you do not make it hard for people and you help them, then if you have a great product over time you will succeed - your retention will be OK and you will have happy customers, who buy and also get great service and help.
However to get there you can be tempted to do some of the things that will prevent loss of customers in the near future, however that will make you survive in the short run, but you will end up losing customers and reputation in the long run.?
Above or below the fold?
Elaborating a little more on the issues brought up in the discussion on keywords, below a more thorough examination is delivered.?
In the old days, where news were primarily disseminated through printed newspapers, advertising through that media was the predominant way of reaching people.?
Being above the fold refers to being visible when a newspaper was folded and placed on a table, tray or other places. I.e. you would be visible with your ad always, and not only for the person who purchased the newspaper, but for all who came within reading distance of the newspaper. This also was the case for a broader audience in kiosks, newspaper stands, cafe’s, hotels and the like where newspapers were placed for sale or for service.
The New below the fold is a google ranking below top 3.
Today above or below the fold typically refers to being visible on the first page of a google search, i.e. you will likely get more clicks on your ad or your keyword. People are in general non-optimizing and lazy, and so more than 25% of people will click on the first organic search-result on google, and the clicks rapidly decrease for result 2 and on.
Only about 1% of total clicks are on page 2 and beyond!
So being on page 2 is definitely the new “below the fold”. However there is also another way to look at it. There are typically 10 results on the first page of a search engine (as per google). However, how many are there in the first screen? There will typically be 3 organic search-results depending on the medium used to view the search results.
Above 50% of all clicks are in the top 3 organic search results.
So maybe being in the first visible screen is the new above the fold.
Some pixel-counting techniques have been developed to ascertain whether a search result is in the first “window” of a search, i.e. finding out if you are digitally above the fold.
As noted before, it does not really matter to ascertain in any technical way whether you are digitally above or below the fold - what this amounts to is good or bad results from your activities. If your results are good, then being below the fold only means there is more potential, which you should test out by increasing your budget anyway. If you are experiencing bad results, then being below the fold still only means the same - try to increase your budget and see what happens. So in the end there is no difference, and above or below the fold remains a frame of reference for discussions and actions.
Below or above the fold is as much a problem now as previously
Answers for conversion
People want answers, not search results. I.e. 1 answer to their question - not 20 search results they need to check out themselves.
The “search costs” in economics are investment into time, energy and money finding resources, customers or information. In this case you are hunting for customers in your marketing efforts, however your potential customers are searching either for information or directly for a product.
So minimizing these costs should be a priority for you.
The same as for search engines goes for websites - make your website so that it answers questions right away and the user/customer will not have to browse through a lot of stuff only remotely interesting.?
This is not easy to achieve, however good work on SEO and SEM will help, as well as thinking about the 5 levels of content. There should be an easy way to scan information on your website with a progression of complexity, so that however any potential or existing customer arrives at the website, they will soon find the depth of knowledge they were looking for.?
To find the right way to both make it easy to get answers right away for an expert and to facilitate a customer journey for a novice; that is a really difficult task. However just having the goal in mind, when deciding on different approaches, will make your decisions better.
In addition this also implies making it easy for potential customers to ask questions and in a manner that is not implying attachment. That is not an easy task - having bots, manned floating communication snippets, book at meeting options, contact by e-mail or a simple old fashioned contact form is not without attachment. The potential customer is looking for information not a sales meeting. So writing that you are willing to offer exactly that, and in so many words is a good starting point. I.e. making sure that the potential customer understands that he can get specifications, ask questions and get answers, and not receive a quotation before he wants one; that is key.
In other words, you want to refrain from gunslinging sales approaches also in your marketing.
The benefit of the benefit
Moving from content and presentation of content, to what the important elements are in the building blocks of your communication in your marketing, below an elaboration on the product, unique selling points and value proposition is framed in the “benefit” discussion.
A lot of discussion about customer value centers on the benefit that the customer gets from the product, i.e. you take the customers perspective.
Taking the customers perspective is a huge and good first step.
However this often leads to a shallow second hand benefit, and hence talking about “the benefit of the benefit” comes into play.
If you look at a customer who buys a drill, what he is buying is not a drill - he is actually buying a hole. So a hole is the benefit of the benefit, and you should ask yourself, what makes my product better at delivering the end result. There is a lot to consider even when the benefit of the benefit is a hole. Is it one hole or multiple holes, is flexibility needed, what medium will power the drill, size and exactness etc. etc. Also depending on your viewpoint maybe the hole is only the benefit, and a safe construction of your house is the benefit of the benefit.
Kotler's 5 levels of product model is a classic way to circumscribe this issue, however it does not really address the communication around the product in order to convince the customer to buy.
Re-designing the FAB-model (features, advantages and benefits) from the core benefit or the ultimative benefit, which is in an Ogilvy fashion the benefit of the benefit could look something like this:
A 4 level model of benefits
This gives us 4 levels of benefit to consider: feature, advantage, benefit and ultimate benefit
In business-to-business marketing, a benefit might be “getting an analysis of the competitive situation”, ad the ultimate benefit can then be “you will look good with a sense of urgency in front of the Board”
In other words, if you achieve the benefit, knowing your competitive landscape in time for your strategy session, by purchasing the product, the Board of Diretors will look upon you favorably.?
Remember the TV commercial that showed a baby sitting in the middle of a Michelin tire? That’s a good example of an ultimate benefit. If you buy reliable Michelin tires, your children are safe.?
So if “the benefit of the benefit” is the real argument for your product, what do you need features, advantages and benefits for? As with any good argument you need a basis and you need premises, inference and conclusions. So you need to address all 4 levels, you need to highlight the features, accentuate the advantages, infer the benefits and then illuminate the customer with the logical conclusion about the ultimate benefits.
Another way to look at this in the business to business realm, is to focus on your customer's customer - as your customer will be selling to his customer, you should help him increase his sales and thereby your sales.
So in short - focus on the benefit of your customers’ customers.
This will help set you apart in the following way:
Something to ponder is to make use of the negative. What happens if you do not get the benefit, then the benefit of the benefit does not materialize.
That creates urgency, and urgency is a major part of what creates deals.
The negative image is however not easy to implement. It has to make sense, so some degree of creativity in framing this will be a necessity in most cases.
Whatever you do in marketing, however, it is important to think about the ultimate benefit and what the real lasting value is for your potential customer.
Referrals?
Going from the essential elements in communicating with your potentail customers to a different method and medium, referrals are a very powerfull way to market your products, when you have good products that address and satisfy the needs of your customers.
Referrals from your existing customers will not occur very often on its own, though.
You have to put some work into it, to make this work - however when you get systematic referrals they are a powerful lead generation engine.
One way you can systematize your referrals are through frequent service calls to your existing customers.
It is always a good idea to check in with your customers. When you have an ongoing relationship, either by repeat orders, or even more critical when you have a subscription, you need to assess if your customer is happy with the service, and in addition make sure that they are using the service to their full benefit.?
So giving the customer a regular service call just to check in is a must.
When you talk to the customer, then just ask for the referral. However, make it easy to do it. Just saying “by the way if you know of anyone in your network needing this great service, then please refer them to me”, that is a good start.
A much better approach is to have 5 potential customer names ready, which you know are in the same industry and are great potential customers, and then ask your customer if they know these companies, and might make an introduction.
If you really want to make it easy for the customer you can search in your customers connections on linkedin, and then find a few great potential customers there (even better if you know they are in the market), and then ask for a referral to one of those - that will make it very easy for your customer to give you that valuable warm introduction to the prospect.
A referral is not necessarily a direct endorsement, however it is an introduction, i.e. just an e-mail og message, saying at least as much as “Hi xxx & yyy, I think you may have some shared interests to pursue…” or something to that effect.?
I.e. it is a mere suggestion, which is made to a warm introduction by the potential customer knowing your customer.
Making it super easy and effortless to do the referral for your customer will guarantee a higher success rate, but also it is proper good manners to treat your customer well, and especially when you are asking him for a favor.
Having prepared for this, thinking it through, and in addition putting it into a systemized approach is a must. This will make it less awkward, and in addition the effectiveness will be higher - this is no magic wand, and many many attempts will amount to nothing.
A softer approach is to have your customer allow you to use them as a reference. So now you only have to ask permission, and you do all the work. I.e. you tell the potential customer that your existing customer thought it might be a good idea to talk - and if you get permission to put the existing customers e-mail on cc, then you are a step further.
Events or conferences with customers are other ways to get referrals. When you invite, you simply tell all your customers that they can bring one or two connections who are not customers. If what you are planning is something of interest they will be inclined to bring people from their network. Also just bringing customers from the same industry or job area together is sometimes very valuable, as you may be facilitating knowledge-sharing if not directly new customers for your customers.
A more indirect way of asking for a referral is to ask your customers if they know of any potential interesting customers for your business. This might not bring about much, however once in a while it brings back some business (or at least some leads to attack), and if you have already asked your customer in the not so distant past in a more rigid way like above, this approach is better than just doing nothing and waiting for time to pass.?
A service call is also a very great way to resell to customers who have old products. It is natural to discuss features used and general performance of the product whether it is a physical product or software. Upgrading is always an option, and to buy a new version is also a frequent option if you value the new features, speed etc. or the product has reached end-of-life.
This is a recurring task, which you must repeat over and over again. You may do this twice a year or how often you have the resources to do it, or how often you feel is appropriate for your customer. This is work, and as such many prefer to talk about it, and how cumbersome it is rather than just doing it - this kind of check-up is not all that resource demanding, it will be taken care of in a 5 minutes call over the phone, and your primary goal is to help your customer get the best service and product that they can have.
In addition you can build CTA’s around referrals in your newsletters or your campaigns. The effect of this will be there, but it will be small compared to the other approaches.
Therefore this is not a substitute for a service call once in a while.
Source: “A new way to measure word-of-mouth marketing”, April 1, 2010 | Article, McKinsey
Real “referral marketing” i.e. making programs or campaigns, where customers get some kind of value for getting new customers to sign up is a topic in itself, however also worth considering.
In addition, influencer marketing is a form of referral marketing, and is also a separate topic in itself, which has real potential for some businesses.
As mentioned referrals are a powerful tool, and you should seriously consider systematizing your approach, as:
Source: “A new way to measure word-of-mouth marketing”, April 1, 2010 | Article, McKinsey
Psychology of Purchase Decisions and Marketing
Going from framing the communication over different tools to consider for the actual content, there is also something to say on how we as human beings are wired and how this has effect on our decision making, and thus how it affects the marketing strategy.
In general when someone does something for you, you are prone to respond with doing something for them as well.
So if you as a company do something (without a fee) for your customers, then they will tend to do something for you - if you ask for it. The last part is paramount, if you do not ask for something you will not get it. It is banale, however often forgotten.
Some examples are free ebooks, free articles on technical issues, free advice in relation to a purchase (which do not benefit you as a company). You can ask for social proof, sign-up to a newsletter or a small purchase.??
This has been discussed at length in the following book:?
Source: “Influence, New and Expanded - The Psychology of Persuasion”, Robert B. Cialdini, Harper Business; Expanded ed. edition (May 4, 2021)
Social Validation
Most people have a herd mentality, so they will adopt the beliefs of a group of people to which they belong or identify with, or to a group of people they like. I.e. what drives this is the desire to conform to the group, or the dislike to stand out as the one apart from the group.
So if you can get a large number of people to endorse you or at least be positive about your company and products, then you will get social proof. I.e. many likes on a post will endorse your post, and there will be no risk in liking it as well.
Influencer marketing is a way to capitalize on this effect.
Priming?
Priming is the effect of being exposed to one stimulus, and then that has an impact on how you perceive another stimulus.
I.e. being exposed to a background with dollar bills on a webpage will make you more prone to consider and read about the price than other aspects of the product, when you click around the site to gather information.
The hard part of putting this fact to use is to know which stimulus affects which other stimulus in order to get the potential customer to do what you want them to do.
If you want to dig deeper into this phenomenon this is by example described in a study by:
Source: Naomi Mandel and Eric J. Johnson “When Web pages influence choice: Effects of visual primes on experts and novice”,? Journal of Consumer Research; Sep 2002.
Scarcity?
A limited amount of some product might induce some fear of missing out (FOMO) in your customer, as this might soon be sold out, and then the customer can't have it at all.
Also having a huge sale, ie. selling many items, and then only having a few left will tell your customer, that a lot of other people also made the decision to buy the product.
Scarcity works well, as it is a normal pricing mechanism. Something which has a very limited supply will naturally rise in price, given the demand is higher than the supply.
So with diamonds, we have come to be able to produce artificial ones, which looks and feels the part, but which can be produced in abundance. So we go to great lengths to actually prove that the diamond is a natural one, and then the prices are much much higher, as the supply is very scarce.
Frequency Illusion
This is when you find a product and consider it, and then you start seeing it everywhere you look.?
Before when you saw advertorials for a mountain bike you would just scroll past, but now that you are considering buying one, suddenly you see it everywhere. Your attenton has honed in on the specific thing.
In marketing you can build upon this effect in both nurturing flows and in remarketing, so that once a potential customer is aware of your brand, then you remind him in different ways and in different contexts, i.e. e-mails, google ads, advertorials, linkedin, facebook etc.
However this is not as easy as it seems, as overload can occur, and also exposing potential customers who already bought the product from you or your competitor. This takes some work in the engine-room of your marketing machine, if you want it to function well.
The Third Choice
Normal decision theory says that you should limit the number of choices, so as to not confuse the decision-maker/customer. This generally means 2 choices, one or the other.
However sometimes psychology plays a role, and a third option is the way to go.
Marketing an Ebook and a printed book you might see something like:
Ebook 25 USD
HardCopy 50 USD
Ebook+HardCopy 50 USD
The third choice is actually the HardCopy only, which shows the value of Ebook+HardCopy, this will propel the customer towards the more valuable deal - however left to only 2 choices most people will choose the cheapest offer.
This exemplified bundling method is used often, but the concept in itself can work for most products, where a third choice is introduced to urge the customer to take the for you more valuable deal.
Loss Aversion?
The fear of loss is higher than the value of a gain.?
When you have something, you really do not want to part with it. Even if what you have is in surplus or you have something else even better - throwing out something valuable is a psychological hard task.
In marketing you can play on this psychological effect by example in freemium products, where you have a period with full access, which is then limited to a smaller feature set, or perhaps fully closed. You may also unlock certain features for a limited time period, and then withdraw them again, if your customer does not buy.?
If you have physical products you can also lease them out at a premium, thereby decreasing the monetary commitment or investment, and the customer will have to seriously consider before they discontinue the lease - because of the loss aversion.
The Verbatim Effect
The verbatim effect is the ability to paraphrase and condense material heard into just the general idea or gist of what was said, rather than repeating information word for word (which would be repeating it verbatim).
People are spending less and less time actually reading online, and people tend to remember in broad strokes or categories.?
So this means you should convey your basic points in your headlines, your graphics and your captions, the basic idea in what that portrays is what a potential customer skimming your site will remember.
This also favors video, visuals and info graphics, quotes and the like.
The Contrarian Matrix for Marketing - Be Unique
Finishing off the marketing strategy a few words on how to make your mark, i.e. not just shouting the loudest, but actually talking in a different and distinct voice.
The contrarian matrix comes from the capital investment sector, by many attributed to Howard Marks from OakTree Capital.
The idea is that if you want to beat the market, then you should not do what everybody else is doing - this will leave you with just average results.?
However if you do not do what others are doing, then you need to be right. If you are not right, then you will perform below the average.
Source: Howard Marks, Oaktree Capital, Memo “Dare to Be Great“ September 7, 2006
Elaborating a little bit on this concept, the issue can be specified.
When you are contrarian and you are wrong, your results will be worse than when you are in the consensus and you are wrong, simply because the majority of people will also be wrong in consensus and thus hold each other and the market up.
However when you are right and you are in the consensus, your results will be positive but not very positive, because you will be sharing progress with everybody else - however if you are the only one to be right, then your returns will be very positive, as you will be sharing with nobody else.
Source: Free interpretation from Howard Marks
Taking this to sales and marketing - if you use all the same ideas and trends that the competitors also use, then you will gain no competitive advantage.
So first of all if you have unique selling points in your value proposition you should make them stand out in ways that the competitors can not.?
I.e. you should find ways to prove what you are postulating, so that it is not just shouting the same song towards the potential customers the same way your competitors are doing it - overrepresenting your value has become synonymous with “marketing”.
It is easy to just postulate the same as everybody else, however the proof is in the pudding - and if you can prove it before tasting, you will have differentiated yourself from the competition in a real way. However this epiphany is just a side-effect of thinking in contrarian terms.
To be really contrarian you should go where your competitors and anybody else do not dare to go. By example find a position that no one holds, but which is in line with your values (and preferably the values of your customer base). Then simply acknowledge that you believe what you believe, and that everybody else is wrong. You can be sure to make an upheaval, however you will get noticed.?
Now the trick is to not be infamous, as the critique from the SoMe mob can backfire in a massive way - but stand your ground and you will get respect. However it is a highly risky strategy and it works best for not too complex issues.
The marketing strategy
So all in all, when you have put in the hours to get to know your business, the products, the market, competitors and customers - and in addition you have contemplated some of the above mentioned areas, all of them or even more areas - then you are ready to make your judgement about what to actually do.
Having devised a marketing strategy and executed on it, you should also remember to evaluate and think again, revise and execute the second time around and iterate the process ever so often.
When you progress, and your results get better and better with incremental steps - then you will have created profit, and if you and your team achieve to be intellectually stimulated and celebrate your wins, then you will have created “Profit & Fun”.?
Have at it!
Strategic Data Analyst | University Lecturer | Data Practitioner | Insights Analyst| Machine Learning Modelling|| Python| SQL
3 年Very well comprehended article!! Thanks for sharing!
CMO hos Court Square Group
3 年??