Update your Marketing 5Ps when Adopting a Customer First Strategy

All marketers know their marketing 5Ps: people, product, price, place, promotion. But do you know what a customer first strategy looks like in each of these? Here are some examples for you to adopt – or adapt.

 

PEOPLE

This is the easiest of the marketing 5Ps for a customer centric organisation to adapt. After all, a customer first strategy is all about your customers. In recent years, there has been a lot of talk about the importance of employees too. Some have even suggested that they are more important than customers! Not me.

I discussed this in detail in another post entitled "Customers Care About Products & Value, Not Employees." Click the link to read my perspective on this topic.

Personally, I believe that customers are your biggest asset. They are the ones who pay your wages and make your business thrive. It therefore makes sense to know them intimately. If you have a different perspective I’d love to hear it; please add a comment below.

In C3Centricity we use the 4W? Template to record and describe the customer personas of our clients’ brands. You can download a FREE persona template for yourself HERE.

In addition to knowing and describing your target customers in detail, the other tip I give the marketers I work with, is to start and end every meeting with the "magic question." What is it? It is simply to ask yourself what your customers would think of the decision you have just taken. This one simple idea is incredibly powerful in identifying actions which are not customer centric. I will give examples of these in the remaining 4Ps below, so keep reading.

To summarise, a customer-centric approach to your customers is start by thinking about them in every action you take. Then to know them as deeply as you can and to keep this knowledge constantly updated.  

 

PRODUCT

This is often seen as the most important of the marketing 5Ps for many businesses. In fact, it is usually the one they think about day in and day out. But it’s not the most important in a customer centric organisation.

Think about it. Without knowing the P for people in great detail, you won’t be able to optimise your offer in terms of the other four Ps. That’s why it’s a customer first strategy that works.

Without knowing the customer in great detail, you won't be able to optimise your offer of the other #Marketing 5Ps. CLICK TO TWEET 

Here are some useful examples of how companies get their product wrong when adopting a customer first strategy. At the end are a couple of right actions for inspiration: 

WRONG! Any business that reduces pack content without informing its customers of it and the effective price increase. Read JD Roth’s “Hidden price increases at the grocery store” for more on this.

WRONG! Exaggerated claims or twisting the numbers of contained calories by having unnatural serving sizes – have you ever eaten just seven potato chips? Or saying a product is 95% fat-free, but it refers to the weight, not the calories!

I once heard that everything written on the front of a pack is a lie! Check this out with any pack and you’ll see what I mean. There’s sure to be something not strictly correct on it. Please share any funny or annoying examples you find in the comments below.

Everything written on the front of a pack is a lie! #brand #marketing #packaging. CLICK TO TWEET

WRONG! Making variant identification difficult for customers. Have you ever bought the wrong product because packs were the same colour and just the names changed? I know I have. Or tried to understand the differences between variants that have five or seven descriptors?

WRONG! Running frequent product tests but only comparing to the latest version. This is standard practice in many consumer goods companies. But if you make regular tests for small changes which go unnoticed in the short term, they can amount to a big, noticeable change over the long term. Better to compare results also to past benchmarks than to only use the current product as your target to beat.

WRONG! Any company that makes it difficult for its customers to use their product. Think large bags of pet food or kitchen rolls without easy-carry handles. Or what about salad sauce or shampoo bottles which are impossible to open with damp hands. Or how about sealed bags which split when opened and need to be stored in a different container. All these are very irritating for the consumer and can quickly become a reason for switching - even with a preferred brand!

WRONG! Making pack or logo changes without finding what your customers like or dislike about the current one. Think about the much-publicised Tropicana disaster back in 2009, or the more recent Gap logo change.

Even the biggest CPGs get this wrong. The Coke holiday edition a few years back, was a white can which consumers confused with the diet version. Understandably they were disappointed, to say the least, when they realised they had bought the wrong variant. 

RIGHT! Taking the customers’ perspective when designing your packaging. Think deeply about how your customers will purchase, open and use your product. Don’t make them struggle in any way, whether to carry, open, close or store it.

RIGHT! Working with your customers to perfect current and develop new products. This is by far the best way to guarantee that you stay connected to changing preferences. It will also result in more successful renovations and innovations.

RIGHT! Be transparent, in your operations, your actions and your plans. Even when you make mistakes. If you aren’t, whatever you try to hide will eventually be uncovered and made public on social media. If consumers believe that the deception was intentional, you will probably also be accused of unethical behaviour. United have discovered this many times over in the past twelve months to their detriment.

A customer-centric approach to the product element of the marketing 5Ps is therefore once again to think about your customers when developing it. And ideally actually involving them in your development and decision-making processes whenever possible.

 

PRICE

Pricing in my opinion is the most difficult of the marketing 5Ps to get right, especially when adopting a customer first strategy. You may think that a customer-first price is the lowest possible. It’s not. People estimate the value of the products and services they purchase, based only in part upon its price.

For example, how many “cheap” products have you bought, perhaps on sale, only to wonder why you ever bought them when you got them home? In these cases you’d bought on price alone, excited by what appeared to be a “good deal.” But then you later realised that your purchase didn’t meet your needs or desires when you contemplated what you had bought more rationally.

Research shows that customers value a better experience above price and it is expected to surpass both price and product by 2020.

Customers value a better experience above price and it's expected to surpass both price and product by 2020. CLICK TO TWEET

Retailers like Aldi and Lidl use their pricing strategies to position themselves against more traditional competitors. In these new super-discounters, consumers accept limited choice for the sake of rock bottom prices. But these retailers are now also expanding their offer to include more brands, to broaden their appeal to less price-conscious buyers too.

Many manufacturers lose out on price-cutting as their margins are stripped to almost zero. This is why they are slowly realising that there is a better way to do business. Both retailers and manufacturers are adapting to new consumer demands of value and not just low prices.

Consumer goods companies, in particular, have for too long relied primarily on price promotions to meet their sales targets. Amazon has forced pricing down in most other categories because people now check online before buying. However, as Amazon starts trialling their Fresh online groceries and their bricks and mortar stores, the retail business is set for massive changes.

As if low prices is not challenging enough, people now expect to receive something in exchange for sharing their personal information. Data has become the trading currency between consumers and product or service providers. This has resulted in many companies totally changing their business models.  Just one example of this is Telecom that has become geolocalization data providers to many other industries. They even make more money selling data than phone services today.

Data has become the trading currency between consumers and product or service providers. #Data #Marketing #SMX #CEX. CLICK TO TWEET

A customer centric pricing strategy will enable businesses to continue to grow, by understanding how to fix pricing levels more carefully. Knowing the value of what you offer and the importance of brands and services will enable retailers and manufacturers alike to continue to thrive.

 

PLACE

This is a major difficulty for every brand, especially if they have a lot of variants. The answer to improving your distribution is your customers – of course!

The more variants you have the more difficult it usually is to gain a wide distribution. If you know your customers as deeply as you should, then you will be able to identify their differences by region. You can then use these to make decisions about what to sell where.

Since most retailers provide limited shelf space to each manufacturer, it is best used by showcasing your top selling variants in that area, plus eventual new offers to test their acceptance.

Another “place” that it is important to understand today is social media. The Pew Research Center provides a 2016 US analysis of the major channels by demographics which is a great starting point. Ideally, you should know both where your customers are and when. That way you can be present when they are open to messaging. But more about that in the next topic.

So you seem this Marketing P is relatively easy for a brand to become more customer centric. You just have to offer what your customers need, where and when they need it!

To have customer-centric distribution, you just have to offer what your customers need, where & when they need it. CLICK TO TWEET

Ok, so I admit that it’s easier said than done when you don’t have full control over your distribution. This is one reason why many manufacturers are now offering their products directly to their customers through online shops.

The change will certainly have a significant impact on retailers and it is only a question of time before they increase the prices of making goods available in physical stores. In so many categories today, outlets are mere showrooms for people to see before they buy – online.

 

PROMOTION

As with place, knowing what messages your customers are interested in receiving from you is one of the keys to successful communications. Of course, and even more importantly, you also have to know where and when they are ready to accept your connecting with them.

Whether it is advertising, price promotions, social media sharing or other communication activities, understanding your customers deeply is the foundation of success.

An organisation which makes it difficult for customers to connect using their preferred channel is not customer-centric. Take a look at your own website contact page for a second. Does it include email, postal and street addresses? Does it have a telephone number or live chat option, or ideally both? It should.

An organisation which makes it difficult for customers to connect using their preferred channel is not customer-centric. CLICK TO TWEET

But if not, then I bet it has a contact form with possibly a drop-down menu from which a customer chooses their reason for reaching out. You probably also ask them for all their details, while not providing them with yours. Definitely not fair play is it?

Another related area of promoting your brands is PR, especially during a crisis. Your corporation is a brand too. To maintain your customers trust it is important to quickly own up when you’ve made a mistake. Don't try to hide it, because this is anyway almost impossible in today's connected world. Being open to what has happened and especially telling your customers what you're doing about it is essential. Customers will understand and even forgive companies that do this. Honesty is definitely the best policy for an organisation that is adopting a customer first strategy.

To summarise, a customer-centric organisation provides their customers with valuable information where and when they need it. They also communicate in ways which enhance the relationship and shows they value their customers' business. When things go wrong they own up quickly, inform the public, say how and why it happened and what they are doing to put it right. They then go on to do just that, by taking the appropriate actions, all the while informing their customers of their progress.  

WHAT DO YOU THINK ABOUT ADOPTING A CUSTOMER FIRST STRATEGY?

Did you notice that the new way of thinking about each of the Marketing 5Ps that I am suggesting involves the customer? Thinking and above all following a customer first strategy is the new marketing objective that gets results.

Thinking and above all following a customer first strategy is the new marketing objective. CLICK TO TWEET

I believe that both manufacturers and customers will benefit from a customer-first strategy. In fact, research from both Forrester and Gartner has now proven this; customer-centric organisations grow seven times faster and are 60% more profitable. Makes you wonder why companies are not rushing to change, doesn’t it?

Marketers have been working with the marketing 5Ps (or 7Ps) for decades, so perhaps it’s time for an update. What do you think? Should they be translated into a more customer centric approach? What do you see as the major challenges to doing this? Why are some businesses still hesitating about moving to a customer-first strategy? I’d love to hear your thoughts on the topic.

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This post is based upon one which first appeared on C3Centricity