Archive for the ‘Marketing Practice’ Category

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The Essence of Marketing Research

Wednesday, May 4th, 2011

The essence of marketing research is ‘reducing business uncertainties by learning more about the markets you participate in’.  It’s about improving your odds when you’re trying to predict the future:  ”How will customers respond to my new ad message?  What message would be more effective?”  “Which features of a potential new product are valuable and attractive to customers.  How much are they worth, in the price of the new product?” “Who has most / least influence on buying decisions at Company ABC?”  “If we do X, how will competitors respond?”

There are 4 essential steps to any successful marketing research project:

1. Collaborate with business leaders to define a significant business problem or opportunity, and describe the information, insights and understanding which will be needed to solve it.

2. Identify the most likely sources of the necessary information, and design a methodology to gather, analyze and interpret the information.

3. Execute the methodology.

4. Use the resulting information, insights and understanding to help decision makers solve the original problem.

 The sources and techniques selected in step 2 depend strongly upon the nature of the problem you define in step 1, so there’s no single answer to your question about “…what types of questions they ask and what type of an expert do they seek when performing primary research.”  Most projects tap into the experience and opinions of multiple important groups, including:

- Direct customers and non-buying potential customers, always including a spectrum of job functions – R&D, brand management, operations, logistics, purchasing – and management levels.

- The customers of our direct customer, and other companies that operate in the chain of turning raw materials into end products – other guys who play a big part in determining our customer’s success or failure.

- Suppliers of other materials or equipment to our customer

- Competitors (This can be tricky.  Hiring a consultant to get information or use techniques that would be illegal for you directly is no protection for you (or the consultant) under US anti-trust, trade and espionage laws.)

- Government employees and academia.  For example, people in the Department of Commerce and regulatory agencies are nearly always knowledgeable and helpful, and US government libraries, publications and databases are generally excellent.

The optimum techniques to use and the most productive questions to ask are dictated by the business problem you’re trying to solve and the nature of the groups whose opinions and experience you focus on.  Large groups (owners of single family homes, consumers of laundry products, independent auto repair shop owners, for example) might be sampled with statistical survey techniques, while individual in-depth interviews might be more appropriate for smaller groups (for example, makers of kidney dialysis machines, designers of office furniture, or paint chemists).  Group techniques (like focus groups) may be great for gathering initial impressions, but are less useful sources for detail and reliability.  

In almost all cases, the real value-adding capacity of marketing research comes from its ability to answer questions that impact the future – questions like “What if …?” and “Why?” – NOT  from its ability to execute a methodology and answer the more simplistic “How many?” and “Who?”.

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Market Research: DIY or Hire an Expert?

Thursday, February 10th, 2011

 It’s a fair question that doesn’t have an easy answer ….

- Some say that engaging a consultant is simply too expensive, an exercise in paying someone else to do what we can and should be doing ourselves.

- Others argue that consultants more than pay for themselves by bring to bear a world of experience, a breadth of expertise, and an analytical objectivity that stretches beyond the capabilities of any company.

Having sat on both sides of the desk – as a buyer and as a provider of marketing research consulting services – my perspective may add some real-world wisdom to your “DIY or outsource” discussions.

Managers sometimes shy away from engaging a consultant because of the expense (or the worry that calling in an outsider may hint at some hidden inadequacy).  In many cases, however, hiring an expert is the smart business decision. 

Here are six situations in which the value that a consultant creates can justify the expense, many times over:

1. When your capacity is limited.

2. When a consultant brings specialized industry knowledge or contacts that you can’t easily duplicate

3. When anonymity is important – when your identity as the study sponsor would reveal too much about your plans, or where your name could influence the answers you hear

4. When you really need a dispassionate objective assessment, free from internal biases, preconceptions and office politics.

5. When a consultant can provide specialized techniques or methodologies that you don’t have – conjoint analysis or focus groups, for example

6. When a consultant can perform tasks more cheaply and efficiently, as is often the case with telephone surveys and data crunching, in-store interviews and mall intercepts, etc

In addition – unfortunate but too often true – an external consultant often brings an aura of credibility, authority and influence with upper management that an internal employee may not carry.

On the other hand, the out-of-pocket costs for consultant fees and expenses is a legitimate reason to consider doing market research projects with in-house resources.  More important, by outsourcing information gathering and analysis, you could pass up a chance to know your marketplace more intimately:

- The party that conducts the marketing research interviews naturally ‘owns’ the resulting relationship with the key players in the value chain.  These relationships may soon become the foundation for expanding your customer base, entering new markets, or introducing product innovations. 

- It is much easier to understand the context of your interviewees’ comments, and to internalize and ‘own’ the insights, conclusions and recommendations when you actually execute the study.

In an ideal world, then, the ideal answer is often “DIY.”  Few of us, however, live in an ideal world, and hiring a competent marketing research consultant is often the most practical, economical and timely alternative.

Coming soon:  “Successful Consulting Engagements:  How to Select a Consultant, Plan a Consulting Engagement, and Manage the Consulting Relationship”

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The Five Things You Must Know about Branding

Saturday, January 29th, 2011

BOB BROTHERS provides business insight, intelligence, and creative marketing strategies to entrepreneurs, business owners and corporate marketing leaders, at www.market-intel.com.

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Your “brand” is the sum of everything that people think, feel, believe and ‘know’ about you, your product and your company

Your logos, trademarks and advertising slogans symbolize the performance, quality and service you promise to deliver

Successful brands can earn Million$ or Billion$ for their owners

Communicate … Then deliver what you promise

You are unique – Your brand building strategy should be, too 

“Branding” is a concept, a strategy, an exercise dear to the hearts of business owners and marketing leaders.  Unfortunately, “brand” and “branding” are subjects as likely to sow confusion and wasted resources as they are to drive business and marketing excellence. 

The foundation of successful branding – whether you’re a start-up entrepreneur, a lone professional or a corporate marketing leader – is a solid business strategy, solidly executed:

- An offering that promises to satisfy the needs and expectations of your customers

- Execution that consistently delivers the values and experiences you promise 

Here are 5 things that every start-up entrepreneur, every corporate marketing manager, and every business owner should know about building your brand and the value it represents.

1.  Your Reputation is Your Brand

Close your eyes (It’s OK, you’re working!) and think about a familiar brand – Apple or Mercedes Benz, for example.  You’ll surely have some clear and distinct images – of the sort of person who is likely to own one, what owning one would be like for you, what to expect of the product and the company that stands behind it.  

Those images, and the reputations they represent, are Mercedes’ and Apple’s true brand, much more than the familiarity of their 3-point star or once-bitten fruit.  To build a valuable brand, you must:

- Clearly and consistently communicate your promise to deliver products, performance and service that bring value and satisfaction to your customers

- Build and nurture your reputation for delivering all that you promise

Your brand’s hard earned reputation – and the value it represents – can be easily tarnished through misuse or neglect.  Consistency, diligence and attention – year in and year out – are key ingredients in every successful brand.

2.  Symbolism:  Logos, Names and Tag Lines

Your brand – all that customer know, believe and feel about you – is a tremendous asset.  But how can you constantly remind customers of the value you bring to them, and to assure that you remain visible in a noisy and crowded marketplace?

Logos, trademarks and product names are the symbols of your brand, shorthand ways of calling up all the images and feelings that you have created in your customers’ minds. 

- Create easily recognized branding symbols – logos, trademarks, advertising tag lines and such – that are memorable and consistent with the image you wish to convey.    

- Use those symbols widely and consistently, in ways that reinforce the value of your products bring and that emphasize the image you wish to project.     

3.  Successful Branding Puts $$$ in the Bank

LYCRA brand elastane fibers (originally DuPont’s, now owned by Invista) dominate large segments of the apparel marketplace – swim and athletic wear, lingerie, women’s fashions.  Despite technical performance that is often surpassed by competing textile fibers, LYCRA has enjoyed huge market share, pricing and new product introduction advantages, simply because of the magic surrounding the LYCRA name.

The success that comes with that magic isn’t free.  DuPont, and now Invista, have invested heavily in building and maintaining the LYCRA brand – advertising, support for innovative fashion designers and marketers, R&D in sports science and performance, leadership in market and technology innovation.

The visibility and respect that result from successful branding creates real, tangible value – in market share points and opportunities for premium pricing, by opening the doors to new markets, and by reducing the costs and the risks of introducing new products.

- Monetize your success: You’ve invested in your brand’s growing recognition and reputation.  Now use that power (wisely and judiciously) to strengthen and extend your business   

4.  In the Beginning – Communicate

Your first brand building task is communication – to establish your visibility, credibility and recognition in a noisy, crowded marketplace, and to stimulate customers to actually ‘try and buy’ your new product.

- Understand your Audience:  Which people are most likely to buy your product?  What product and service characteristics would most appeal to them?  Where are they most likely to learn about products like yours? 

- Tailor the content and the look-and-feel of your message to the needs, expectations and sensibilities of your target audience.  What information (and what emotional appeals) will motivate them to buy?  What must they know to find you and complete their purchase?  How does your message reinforce the brand image you wish to project?

- Select the mix of communications vehicles (website and SEO, TV ads, face-to-face promotion, social media, etc) most likely to capture the ‘eyeballs’ of the people you need to influence      

5.  Build a Branding Strategy That’s Right for YOU

The right brand building strategy for you depends on creatively assessing the unique nature of your business vision, your product, and the customers you aim to serve.

- Who do you want your company to be?  Low price leader or luxury brand?  Mass market or artistic and avant garde?  Technology leader or plain vanilla?

- Design you products and your actions to deliver the performance and experiences your customers value and expect

- Tailor your communications to suit your intended audience and to project the image you aspire to

- Manage your performances to faithfully and consistently deliver the products, service and experience that your brand promises.   

Successful branding is an investment in hard work, consistent attention, and patience, but the pay-off can add Million$ or Billion$ to the value of your company.

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VI. Monetizing Your Successful Brand

Tuesday, January 25th, 2011

Part VI of an extended exploration of nature and value of “Branding” and practical discussion of how to create, strengthen and extract greater value from your ‘Brand’

The foundation of successful branding – whether you’re a start-up entrepreneur or leader of a corporate marketing department – is a solid business strategy, solidly executed:

- An offering that promises to satisfy the needs and expectations of your customers

- An organization that consistently delivers the values and experiences you promise 

Creating a successful brand requires investing ample time, $$$ and effort in building and maintaining the excellence of your business.

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While communication is the first priority of start-up and new product branding, the brand-building imperatives of established companies are more varied:

1.  To nurture, strengthen and protect the reputation you’ve already earned

2.  To use your good name and reputation to deepen relationships with customers you already have

3.  To open doors to new markets and to successfully launch new products.

In this part of the product life cycle, four tools are key to strengthening your brand and expanding its influence and value-creating power:

Foresight:  Anticipating, and developing innovations to answer your customers’ evolving needs and changes in the marketplace. 

Execution:  Consistent, trouble-free performance that is focused on keeping a step ahead of your customers’ evolving needs and preferences

Communication:  Messaging which explains and reinforces the value and satisfaction that your products deliver, and the benefits that your company brings to the large community.

Diligence:  Protecting your brand from decision within your company that would dilute or neglect the reputation your have earned, and from outsiders who would misuse your products and good name.     

You’ve invested in building the value of your brand and the reputation that stands behind it.  They’re your guarantee to deliver what customers have come to value and expect.  You’ve earned that trust, now here are ways to monetize your brand equity:

- By charging a premium price – National brands of canned tuna are almost always more expensive, for an essentially identical product

- Through greater market share – Coke and Pepsi dominate the grocer’s soft drink shelf, although there are plenty of other fizzy cola brands 

- Through easier access to new customers and new markets – New consumer electronics?  Sony and Apple have a big head start over any new competitor.

- By launching new products, more quickly and with lower risk

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IV. Brand Building for Start-Ups

Wednesday, January 19th, 2011

Part IV of an extended exploration of nature and value of “Branding” and practical discussion of how to create, strengthen and extract greater value from your ‘Brand’

The foundation of successful branding – whether you’re a start-up entrepreneur or leader of a corporate marketing department – is a solid business strategy, solidly executed:

- An offering that promises to satisfy the needs and expectations of your customers

- An organization that consistently delivers the values and experiences you promise 

While branding plays an important role in business strategy, no fancy logo or advertising campaign can overcome the drag of a poorly conceived product, poorly presented. 

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As a start-up, your hands are probably more than full juggling all the details of getting your business up and running.  Fortunately, getting those details right is the first step in building your successful brand.  There are 3 fundamental elements:  Defining your identity, communicating the performance and values you promise to deliver, and execution that fulfills your promise.

Define Your Identity

Your start-up’s first brand building requirement is to clearly define your identify – the character of the company you aspire to be and the nature of the markets you intend to serve.  For example:

- Want to be known as the luxury brand (and earn the right to charge luxury prices)?  Then everything you do – from the way your phone is answered, to your employees’ demeanor and dress, to the appearance of your store, website, signage and advertising, to the way you pay your suppliers – should whisper elegance and respectability.

- If you elect to be a bargain-basement supplier, your customers may tolerate bare-bones facilities and less than attentive staffing, but the bargain hunting customers who flock to you today can just as easily fly off to the new-discounter-in-town tomorrow.

-Aiming to serve mass-market tastes and sensibilities?  Better not plan to switch gears and become the next hot spot for the artistic and avant garde.

Pretty elementary stuff, I know, but a lack of clarity and focus around your identity and the purpose of your business – and the dilution of effort that results – is the Achilles’ Heel of too many start-ups.

Communicate Your Promise

As a start-up, your first imperative is to quickly establish your visibility, credibility and recognition in a noisy, crowded marketplace.  Communications is the start-up’s key branding task, and your goal:

Shape all your formal and informal communications to create a memorable image of the attractiveness of your product and company, and an enthusiasm within your potential customers to spend their $$$ with you.

                The array of communications vehicles available to you is both seductive and confusing:  internet presence and SEO, e-mail and social media, print and TV advertising, seminars and customer meetings, or host of other vehicles for getting your message before the public.  It’s tempting to jump in – and spend tons of money – before you have a well planned communications strategy.  Build yours around fact-based, objective answers to these priorities:

1.  The Audience:  Which groups of people are most likely to buy your product?  Why would a product like yours appeal to them?  Where are they most likely to learn about products like yours?  Who else might influence their decision to buy from you?

2.  The Content of Your Message:  What information (and what emotional appeals) would motivate people in your targeted market segments to try your products?  What do they need to know to find you and complete their purchase?

3.  The ‘Look-and-Feel’ of Your Message:  What will appeal to the sensibilities of the people you need to influence?  How can you create the proper image of your company and product?

4.  The Communications Media:  What mix of communications vehicles is most likely to capture the ‘eyeballs’ of the people you need to influence

Armed with this sort of insight, you’re in position to create a communication strategy that uniquely suits your company, your product and the markets your aim to serve, providing: 

1.  Education:   ”Yes, I see what your product will do for me.”

                                “That’s something that would be really valuable to me.”

                                “Now I know where to get one.”

2.  Recognition:  “I remember hearing about your product.”

3.  Motivation:    “Oh, yes!  I want to go get one now.”

If your communications can elicit answers like these, you’re well on the way to success.       

                “More details, more specifics” you ask?  Well, I wish I could, but your business, your product, your customers, and the market environment you’re in are like no others.  A big part of the success of your branding effort will be your creativity and skill in crafting a message uniquely suited to your situation and goals.  Here are some thought-starters to point you down productive communications pathways …

An animated, slapstick TV commercial may be a fine way to sell beer to an audience of couch potato athletes, but it’s not likely to appeal to the well-healed retiree looking for discrete wealth management advice.

Selling a new synthetic lubricant for jet engines demands facts, figures and no-nonsense data, but an ethereal vision of fantasy and hope sells more cosmetics. 

Your grandmother probably won’t learn about new osteoporosis drugs on TWITTER, and it’s not likely that the high school video gamer will see your ad in the local newspaper.

Internet marketing is probably not the most effective way to enroll a high end life insurance prospect, but you can’t afford to rely on 1-on-1 customer visits to promote your fancy cupcakes.

Remember – Effective communications begins with a clear sense of the message you need to convey, molded by your understanding of the needs, preferences and expectations of your intended audience.               

Execute Your Promise

Respect for your brand comes from delivering performance and experiences that satisfy your customers.

Make sure that, from the beginning, your execution is right.  Delivering what you promise is the key to building a strong and valuable brand.

Customers, casual lookers and third party busy-bodies continually balance what they experience against what you promise.  A mis-match between what you promise and what you deliver can quickly become a brand killer. 

- You promise low prices but customers find you’re scooped by the discounter on the corner

- You promise excellent service, but phones and emails go unanswered

- You promise confident professionalism, but show up late for your appointments   

No amount of advertising or fancy logos can overcome the disappointment of a product that doesn’t work, missed delivery dates, unanswered telephone calls, or rude and unresponsive service people.  News of poor products and service spread far and fast, and repairing a bad reputation is no easier for your start-up than it is for a high school outcast.

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III. The Value Creating Power of ‘Brand’

Thursday, January 13th, 2011

Part III of an extended exploration of nature and value of “Branding” and practical discussion of how to create, strengthen and extract greater value from your ‘Brand’

Successful branding can be hugely valuable, far beyond the mere functioning of the product or service itself.  Think Google and Facebook, Coca Cola, Mercedes Benz, Apple, Nike, Whole Foods, the Rolling Stones ….  

LYCRA brand elastane fibers, a phenomenal money-maker for its inventor, the DuPont Company (and for current owner, Invista) is a great story of branding success.  Even though DuPont didn’t make the LYCRA swimsuit or lingerie, or even the stretchy fabric that the garment is cut from, DuPont’s investment in branding has made LYCRA one of the most respected, well known and valuable names in fashion and functional apparel.   

During its heyday, DuPont’s LYCRA fibers commanded huge market shares –and prices often 50 percent higher than competing spandex fibers – translating into hundreds of millions of dollars of extra profits, year after year, for DuPont.  This, even though the LYCRA fiber was often technically inferior – in the length of its stretchiness, the strength of its snap-back, its resistance to repeated trips through the washing machine and dryer – compared to the competing brands. 

DuPont pursued a decades-long, comprehensive, coordinated strategy to reinforce the mystique and exclusivity of the LYCRA name, including:

   – Targeted advertising and co-promotions

   – Support, encouragement and publicity for innovative fashion designers

   – Support for sports science research, product development and promotion

   – Leadership in end user focused product and technology development

The resulting avalanche of profits, year-in year-out, was DuPont’s reward for years of aggressive investment in building, maintaining and protecting the LYCRA brand.

Other examples of the value added by a company’s or product’s good name and reputation?  Look no further than Facebook, Intel microprocessor chips, or Gucci bags, a Niemann Marcus, GatorAide or your latest i-accessory.   

The extra value represented by this ‘brand equity’ isn’t just a psychic reward for market success.  It has real, money-in-the-bank consequences:

   – Enhanced market share points and growth rates

   – Opportunities to charge premium prices

   – Opening up new markets and reducing the risks of introducing new products

    – Greater market value for your company

And a final, cautionary, note:  “Brand” isn’t necessarily forever.  Neglect and abuse can degrade the value of your brand just as surely as they can wreck the value of your house.  Think Lehmann Bros, Lindsay Lohan, Oldsmobile or Gateway computers. 

 Maintaining the hard earned value of your brand requires continuing attention and investment – in new product development, in perfecting news ways of relating with your customers, in diligent conversation with your marketplace, and in continuing excellence in execution.

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Part 1 – Introduction to Brands and Branding

Tuesday, January 4th, 2011

Part I of an extended exploration of nature and value of “Branding” and practical discussion of how to create, strengthen and extract greater value from your ‘Brand’

                From the largest corporations to the entrepreneurial start-up, “Branding” is a concept, a strategy, an exercise near and dear to the hearts of business owners and marketing leaders.  Unfortunately, ‘Brand’ and ‘Branding’ are subjects as likely to sow confusion and wasted resources as they are to drive business and marketing excellence. 

                To many entrepreneurs and market development managers, ‘Branding’ means selecting a name, designing a logo, and laying out a snappy advertising campaign.  Their driving interest is to generate early visibility, credibility and awareness, and to stimulate a respectable number of potential customers to ‘try and buy.’  Others approach Branding as a long term business strategy, a sustained investment aimed at creating Millions or Billions of Dollars worth of ‘brand equity.’

                There is a depth of truth in each of these concepts of “Branding”, along with a significant degree of incompleteness.  Great new products might never reach the light of day without a healthy infusion of introductory publicity and hype. But, relegating your branding investment to your new product launch risks leaving significant $$$ – potentially Billions of $$$ - on the table.

                An intelligent approach to branding encompasses both the short term need for visibility, credibility and recognition, and the longer term opportunity to create tremendous power and wealth in your brand.  While tactics to implement these diverging views of the ‘branding’ may appear radically different, the fundamentals are surprisingly similar:

1. Crafting an offering which is especially attractive to potential users

2. Communicating your promise to deliver performance characteristics and experiences that are valuable to the customers you hope to attract

3. Establishing your visibility and credibility among audiences which matter most

4. Consistently delivering what you promise

Simple enough, but there is a world of marketing strategy, plans and tactics – not to mention the hard work of consistent execution – required to create and communicate your promised ‘valuable product performance and experience’.  In the following chapters, we will:

- Take a closer look at the fundamentals and value creating potential of a well planned and well executed branding strategy

- Highlight important steps that you can take to strengthen and extend the power of your brand

 A couple of notes regarding fundamentals:

- As used here, the term ‘customer’ goes far beyond your transactional customer,  the party who hands you a credit card or sends you a check.  It also encompasses the much larger circle of the public which can influence you failure or success – potential customers and disgruntled former customers, competitors, commentators and regulators, internet busy-bodies, …

- ‘Product’ means whatever you’re selling – cars or cupcakes, business consulting or personal advice, dental or banking services – along with all the things that go along with it (your price, instruction booklets and telephone tech service, packaging, “batteries required – purchase separately”….)

- “Experience” is all those other ways that you touch your customers and community – the ease of finding and navigating your website or store, how well you answer emails and the telephone, the friendliness of your people, your ability to ‘get it right the first time’, the news and publicity that you and your employees generate ….    

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