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August 2000

 

The Unbeatable Formula: Innovative Marketing And CIM 

BY NADJI TEHRANI


During my many years in this industry, it has always amazed me how many individuals and organizations approach marketing as a "necessary evil." Many companies throw together marketing programs half-heartedly, seemingly because, "It's something we have to do." By the same token, customer relationship management, or its close sibling, customer interaction management (CIM) is approached with equal hesitancy, if it's approached at all.

One of the most enjoyable parts of my job, in addition to working closely with the team members here at TMC, is interacting with the senior management of various companies and observing how the processes of marketing and CIM are handled (or mishandled!) in different organizations. In those companies that have ineffective marketing and advertising campaigns in place, the management does not have a basic understanding of what marketing is, and what purpose it should serve. So, if you'll allow me to use a sports-related analogy, when a football team that was formerly a winner begins to experience a losing streak, an effective coach will sit down with the team and go back to the basics. In the same manner, companies with poor marketing and advertising need to sit down with the players in their organizations and motivate everyone to understand the definitions of marketing, advertising and sales; how they complement each other and how to implement them effectively.

In my direct experience here at TMC, I have discovered that keeping an effective marketing and advertising plan in place is hard work and requires individuals who understand these basic concepts. To prospective marketing personnel, we administer a "marketing test" that requires a candidate to define marketing, sales and advertising, among other things. You may not believe it, but 95 percent of seemingly qualified candidates with marketing degrees cannot pass this test. Some of these individuals are people who have years of experience in marketing, management and directorship positions, but they fail the basics. So what is going on in corporate America? (To read my thoughts on this subject, you might want to revisit my June 1996 column "The Sad State Of Marketing In Corporate America.") In that article, I wrote about an experience we had recruiting a qualified marketing manager. We received upwards of 800 resumes for the position, many from individuals with Ivy League educations and experience as marketing managers of Fortune 500 companies. We chose about 40 candidates to come in for interviews, and as usual, we administered the marketing test I developed for this purpose. I was stunned to find that of these 40 candidates, all of them highly qualified on paper, 95 percent of them failed to offer a proper definition of marketing. Moreover, most of these candidates could not explain positioning or the principles behind an effective promotion piece. The majority of individuals could not define integrated, relationship and loyalty marketing.

SO LET'S EXAMINE THE BASICS
What Is Marketing?
Among many other things, the role of marketing is to create an awareness (brand awareness) of a company's products and services to the global marketplace. If marketing is conducted properly, its raison d'tre should be to generate interest and sales leads to build the foundation for the company's long-term growth and prosperity. 

What Is The Job Of The Sales Department?
Next, let's define the sales function. The job of any good sales department is to take the sales leads generated by the marketing department and convert these leads into sales and long-term, loyal customers. The bottom line is that all sales begin with sales leads, therefore it becomes clear that just as the marketing department's role is vital, it is even more important for the sales department to understand how to effectively use the efforts of the marketing department to turn leads into closed sales.

The Role Of Advertising
Advertising is a natural component of marketing in that it carries out the mission of the marketing department. It acts like a tool that the marketing department can use to create the necessary awareness of a company's brand, products and services. Most important, an ad should be innovative and effective enough to differentiate the company's offerings from those of competitors, thereby enticing potential customers to contact the company, ask about products and make a purchase. An effective ad should also enhance the big picture of the organization and become what the advertising industry refers to as "image advertising."

One of the most irritating things I see daily is ineffectively prepared advertising. I once read a great quote by well-known advertising guru David Ogilvy, who stated that, "Fifty percent of all advertising dollars are wasted. The problem is, we don't know which 50 percent."

With all due respect to Mr. Ogilvy's valued perception, and having worked nearly 25 years in the publishing industry, I have observed many poorly prepared advertising campaigns and venture my opinion that the figure is closer to 90 percent. If you have any doubts about this claim, let me pose a question to you. What percentage of advertisements you saw 30 years ago do you remember today? What percentage of ads from 10 years ago can you still remember? Even more telling, what percentage of ads you saw a week ago or even yesterday can you recall? Did you take action as a result of any of those ads? In my experience, most people can count on the fingers of one hand the advertisements they remember and found effective enough to respond to by making a query or a purchase.

I have a few favorite ads from years past and I would like to share them with you. About 20 years ago, I saw an ad similar to the one in Figure 1, which I have adapted for TMC as an example. It is brilliant in its simplicity...it contains no clutter and no pandering, and the reader "gets the point" in seconds.

The second ad I spotted about 15 years ago (Figure 2). Along the same lines as the ad above, it is simple, to-the-point and highly effective.

The last example I have to offer is even older than the two above and can be seen in Figure 3. I spotted it in a well-known boating magazine about 32 years ago. The creators of this ad, aware that their competitors were fond of using an endless parade of pretty girls in bikinis to sell their products, decided to take a different approach. In my opinion, this ad was (and still is) 10 times more effective than any ad from the yacht company's competitors.

Figure 2                                   Figure 3  

          

How many companies are capable of producing brilliant ads like the examples above? The answer, I think, is perhaps a dismal 10 percent.

The Components Of Effective Marketing
Any company serious about conducting an effective marketing campaign must do an outstanding job in all the following areas.

  • Telemarketing. (This is one of the most underused, unvalued, but powerful tools a company possesses.)
  • Multimedia marketing.
  • E-mail marketing.
  • Trade show marketing.
  • Database marketing.
  • Viral marketing.
  • Web-based marketing. Good marketing can never be static, it must follow communications advances. Your customers are on the Internet. Your company had better be there, as well. Think banner ads, e-mail newsletter sponsorships and Web-based cross-selling and upselling via chat and voice over IP.
  • Relationship marketing. This is last, but certainly not least. Marketing shouldn't only be a tool to sell a single product. It is best employed to forge a customer's relationship with your company. If you succeed in proper relationship marketing, you'll build loyal customers for life.

How many companies are doing all the above effectively? I'm sure you know from your own experiences, not very many.

Why Relationship Marketing Is Vital
Relationship marketing is an extremely important part of any sales and marketing effort, because 75 percent of all buying decisions are made based on emotion.
If a customer doesn't have a relationship with a vendor, he or she is less likely to buy the company's products or services. This becomes even more true as the value of the products and services in question increases.

As we know by now, failing to properly deploy good customer service, front- and back-end systems and effective delivery is why so many dot com companies have failed and will continue to fail. Overwhelmed and undermanaged, these companies drew potential customers to their sites, and then had no idea what to do with them.

In a similar manner, many companies have the basics in place, but have entirely failed to outsmart and outsell their competition. It's not enough just to be good, you must be better if you're going to keep ahead of your competitors. Just meeting modest goals for marketing, advertising, CRM and customer service won't make your company stand out...you must excel at these principles.

The Cardinal Rules

  • If you don't market, you don't exist. There are no exceptions to this rule. Customers don't have ESP and can't "find" your company if you don't tell them about it. This failing is most common in the tech-driven companies. They concentrate all their efforts on building a better mousetrap, only to discover that the mouse died 15 years ago. When they finally begin to understand the necessity of implementing a marketing and advertising plan, they seldom succeed in doing it properly.
  • Marketing is NOT a part-time job. Half-hearted attempts will look just like what they are...and yield half-hearted results, if any at all.
  • Business exists for two reasons: marketing and innovation.

I'd like to share with you an example of someone who has taken the third cardinal rule regarding innovation to heart. A few years ago, I received the most unique holiday card I have ever seen. Now, I receive hundreds of holiday cards from various individuals and companies, and they are all beautiful and always welcome. But this particular card stood out from the rest. When the envelope came, it appeared to be a check. Intrigued, I opened it to find it was indeed a "check" made out to me...for 365 days of happiness for the new year. (See above.) I was so taken with the card I telephoned the sender. He informed me that the cards cost his company approximately one cent each to produce, as they were merely photocopies, three to a single sheet of 8 1/2" x 11" paper. Because of the innovative thinking of this company, it cost the management only one cent to make such a strong impression on me. This is one of the truest examples of innovation in marketing I have ever experienced.

The Two Laws Of Positioning
The first law of positioning is, "It is better to be first than to be better." As I've said before in previous editorials, everyone remembers the number one player. Nobody remembers who came in second.

That leads us to the second law of positioning, "If you cannot be first in a given endeavor, find a niche in which you CAN be number one." This rule becomes even more vital in today's breathtakingly competitive economy. Many companies have done well by this principle and have managed to carve out a desirable part of their market and dominate it.

What it all boils down to is that in today's ultra-competitive environment, one must do whatever it takes to legitimately outsell, outsmart and outmarket the competition.

The bottom line: Cutting-edge, savvy and innovative marketing, advertising and CIM are the recipe for success. Why does CIM belong in this equation? Because without appropriate CIM, you will lose customers as fast as the marketing and sales departments can bring in new business. Implemented properly, these elements combine to create the unbeatable formula.

As always, I would love to hear your thoughts and experiences.

Sincerely,

Nadji Tehrani
Executive Group Publisher
Editor-in-Chief
ntehrani@tmcnet.com

[ return to the August 2000 table of contents ]







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