Is It Really Possible To Measure Marketing ROI

In an increasingly competitive B2B marketplace every department must prove its contribution. Manufacturing output is relatively easy to measure as is the contribution of the sales department but what about the marketing department? Is it possible to measure marketing ROI?

There have never been so many tools available to measure the results of marketing activity. But do those tools really deliver reliable data on which to base decisions. Is spending time and resources on collecting a mass of data the best way forward or is there a better way.

The basic ROI calculation is (Return – Investment) / Investment over a specific period of time. The return could be sales, gross profit or some other variable.

Marketing ROI could, therefore, be measured using the formula (Sales – Marking investment) / marketing investment over a period. However, some of the sales growth may be organic. That is it would have come in regardless of marketing effort. For example simple repeat business.

A more accurate calculation may be (Sales – Organic sales – Marketing investment) / Marketing investment over a period. At a top level, this will deliver a number that should show in broad terms if marketing is delivering (or not).

The aim of the marketing department is simple. They need to maximise the sales number while minimising the marketing expenditure. They, therefore, need to know which of the multiple activities they undertake has the maximum impact and which are not worth the investment.

If marketing costs are to be controlled it is reasonable to assume some measurement data will be required. It’s logical to collect measurement data and make decisions based on that data but is that really possible. Investing in the wrong areas or minimising the wrong costs will reduce the contribution of marketing.

It may be activity X appears to deliver excellent results but how do you know that is not impacted by activity Y. What if some external factor (Z) that may be nothing whatsoever to do with marketing is having an impact. Can you actually isolate Y and Z and thus measure X more accurately. In essence, can you really make an accurate measure of X, Y or Z?

The Measurement Issue – An Example

Every year for as long as I can remember I have had at least three severe colds or flu during the winter months. That changed a couple of years ago when I changed my diet after a health scare. Since then no more winter colds – not one.

So it would seem diet and lack of infection are related but something could have changed over the same period. I have worked from home more and am around people less and (to be blunt) therefore less exposed to sources of infection. Could that be the reason?

Let’s assume a change of diet was the reason I then have two options. I could give thanks and not worry about which specific change (or changes) to my diet made the difference. Alternatively, I could spend time and effort trying to establish which items made the difference so I may eat more of them.

If I don’t worry about what caused the change I run the risk I could inadvertently drop a critical item from my diet and the colds may return. If I try to identify specific items that caused the change isolating those items is a far from simple task.

To reduce the complexity involved in identifying specific causes I could try to make some assumptions. However, that may introduce estimates and errors that make any conclusions I reach useless.

I could, for example, assume the change was down to the increase in fruit I eat. There is a widely accepted view that increasing vitamin C intake helps prevents colds. Is that assumption based on strong research data or is the basis for the theory (if any) lost in the mists of time?

I could stop eating fruit and see what happens but how long do I wait before I measure results? What may happen to my health in the meantime? What about Vitamin C I could pick up from a host of other foods. How do I build a valid test with suitable controls?

A vast amount of time and effort may not actually deliver a definitive result. Vitamin C may indeed have an impact but what if that impact is only delivered if factors X and Y that I am not measuring (or may not even have thought of) are also present.

The Problems With Data

There are many third party tools available for measuring the impact of various elements of the marketing mix. How can you be sure that a positive change in whatever is measured is not the result of some transient event you are unaware of (or have chosen to ignore). What about the long term fuzzy objectives like brand awareness how do you measure that?

Most measurement tools make various assumptions in their calculations. How do you know what those assumptions are? Without accounting for assumptions the data could be way off. There may be a widely held belief in a business that ‘X’ is an undisputed fact. The problem is assumptions can become recognised as facts over time (almost as part of the folklore) when they have no scientific basis.

There is no such thing as perfect information so where do you stop. Data can be used as a crutch or worse still an excuse. That shouldn’t have happened! The data said otherwise. With too much data, too much analysis a business can be slow to react to what is happening in the real world.

What’s The Alternative

At the other extreme a who cares about the specific cause if it is working approach may be employed. The business may run on something that is difficult to quantify – feel. There may be some very broad measurements of performance in place but that is all.

The risks of this approach are obvious. There is a lack of control. Costs could spiral with no checks and balances. If results hit a downward trend is it possible to establish what needs to be fixed?

A lack of data can lead to an increase in company politics. Did sales contribute the most to bringing in the order, or was it operations. Maybe the opportunity would not have existed in the first place if it was not for marketing. Did the design/engineering department come up with such an elegant, cost effective solution to a problem that it sold itself? Those best at playing the political game usually win the argument.

On the plus side, a business run on feel tends to be more able to react to the market. They tend to be far less bogged down in data and closer to what is happening in the real world. However, businesses that succeed with this approach tend to have a specific organisational structure and culture. It tends to only work in smaller organisations or in larger organisations that are able to isolate specific groups or teams.

Both the data and the ‘feel routes have their pluses and minuses. A mix of the two measuring a trend rather than an absolute measure of marketing ROI may be a more appropriate goal.

The rough measures (or no measure) approach tends to lead to a business that is faster on its feet and more tuned in to its market but it has obvious risks. The business with perfect data (if such a thing exists) and the courage to act on that data given the external forces and internal politics that may swirl around should make excellent decisions. The trouble is those decisions may be too late.

How To Select The Best New Product Ideas

Generating a steady flow of new product ideas is difficult and time consuming so it can be tempting to push ahead with any product concepts that are identified without further thought. However, given the substantial resources allocated to a new product development, that approach can be an expensive mistake.

In this post we develop the discussion in our post covering how to reduce the risk of new product failure to discuss the value of the new product screening process, including some suggestions on what to include (and exclude) based on hard won experience.

In this old, but gold, post Susan Greco discusses some of the myths surrounding where new product ideas come from . Often, product ideas are not true new products at all but simply line extensions or copies of competitors’ products.

True new products (as defined in our recent post ) are less common but potentially much more valuable. That said, any screening process must be able to justify (or not) further development of both the line extension and the true new product as both may potentially add significantly to future growth of the business.

Key Elements Of A Screening Process

So what are the key elements of an appropriate new product screening process? To make a bland (but valid) statement it must be flexible enough to let through what may appear to be radical new product ideas but rigid enough to drop poor ideas as early as practical in the process. That may be easy to say but is far from easy to implement.

There are many examples of companies who have dropped new product ideas that have gone on to be a major success in the marketplace. Perhaps the most famous case is Xerox (allegedly) giving away the technology that led to the development of the Apple Mac. Famously, Kodak developed the digital camera way back in 1975 but failed to understand its potential. The key elements of any new product screening process are:

  • It must be consistent
  • It must match corporate objectives
  • It must match corporate capability
  • It must be based on solid data – documented
  • It must have the flexibility to address true new product ideas and market opportunity.

Whatever the process it must be approved, and more importantly supported, by higher management and must not be circumvented by those with management or other influence that simply have a ‘gut feel’ their idea is a winner.

It must also be a formal process, undertaken at regular (communicated) intervals. An attempt should be made to match the frequency to the number of new product ideas arising otherwise there is a risk of ad hoc decisions being made simply on the basis there is no time to wait for the next meeting.

If either of the above are not in place then there is little point putting the time and effort into a process that will simply by bypassed at will. The process must apply in all situations or not at all.

Consistency

Whatever the screening process may be it must deliver a pre-set number of gates (questions) any new product must answer to proceed to the next stage. Those gates must be designed to let through (or not) a wide variety of ideas, some of which may be radical or distinctly left field.

The same process must apply to every situation as it is not practical to have several flows (depending on the idea type) or a process that is over complex with too many options. Whatever flow is designed must be applied consistently regardless of the new product idea presented for screening.

Match Corporate Objectives

The new product must match with the stated corporate strategy, pre-requisite lifetime sales value, profit and growth objectives to be passed through to the next stage. As noted below these elements are top level screening elements coming before market opportunity.

Perhaps an example from my early career may illustrate the point. Sales identified an opportunity for an equivalent to a competitor product. The competitor had been entrenched in a particular account for years and my company had been unable to secure any of the valuable business available. However, an opportunity had arisen as the competitor could not deliver a particular product for technical reasons. The lifetime project value for the product was not significant but it was seen as an opportunity to gain a foothold in the target account

Sales, quite naturally, wanted to develop and deliver the initial quantities the customer needed of the equivalent product as quickly as possible. Commitment was made to tens of thousands of pounds of tooling costs and resources re-allocated from other projects to make the new product happen as quickly as practical. The product was delivered on time as were the remainder of the project quantities but no further orders were secured for the customer and tooling costs were not fully recovered.

The above is no criticism of sales as the objective was perfectly reasonable. The point is if project value was a top level screening element, higher than penetrating key accounts, then the above project would have been screened out (if we had a screening process at that time – which we did not). However, if the reverse was true then it would have passed. The screening process must be designed to specifically match corporate objectives, be they market penetration or maximising turnover and profitability.

Match Corporate Capability

This is perhaps the most contentious area of new product screening. It is a valid argument to state that if the product idea will generate sufficient returns then the capability can always be put in place to deliver it. However, in reality to produce something new to the business does not just require equipment it also requires people with specific experience of the required design and manufacturing processes.

Higher management must decree what will (and will not) be considered outside the boundaries of the current corporate capability. As a catch all a gate may be added, based on target revenue and turnover figures that allows new product ideas outside corporate capability but with sufficient value to pass through to be considered further at higher management or board level. If approved these product ideas may then be passed back to continue their journey through the screening process.

Based On Solid Data

Data on any new product idea will always be far from perfect but whoever may be promoting the new product idea internally must be prepared to collect relevant market data to support their idea. The data must be made available (and documented) to answer the specific questions at various gates in the process.

It is obvious therefore that the screening process and its gates should not be published and its criteria should only be known by the new product screening committee. If the criteria are known then those presenting new products may either massage the data accordingly or routinely discard new product ideas they believe will fail the process when they are genuine new products with merit.

Designing a process to select the best new product ideas is far from simple. There are many competing criteria and it is important to decide which of these criteria are the most important and which can be reviewed at a lower level. Higher management input to the selection criteria and there unwavering commitment to the process are crucial to success.

A B2B Market Analysis Template

When building a B2B strategic marketing plan for any business an in depth market analysis is of vital importance. Without analysis the resulting plan is likely to be of little practical use resulting in significant wasted resources on a document that simply sits on a shelf gathering dust.

What is strategic B2B market analysis?

The basis of any strategic planning exercise is a route from where we are now to where we want to be in a set timeframe. To plan that route it is necessary to know what resources we have at our disposal, what barriers are we likely to face (environment) and what skills can we utilise (strengths and weaknesses) to overcome those barriers

Appropriate analysis provides the data upon which we can answer the above questions. Analysis is the foundation on which the strategic planning process is built. If it is incomplete, or worse inaccurate then the entire process is likely to be a complete waste of time and effort.
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Where The Theory falls down

All sounds wonderful in principle but the reality is somewhat different. Often the analysis process lacks focus or is superficial. Collecting key people in a room for half a day, drawing the dreaded cross on the flip chart and brainstorming through a SWOT analysis is not enough.

A SWOT is not the starting point but the end point, it is really only a tool to create a visual summary of a robust and quantified data collection phase. Appropriate focus is required or many hours can be wasted collecting data that is not relevant.

Before starting the analysis process it is worth asking some key questions including

  • What is it (in simple terms) we offer to the marketplace?
  • Who needs that offering and why?
  • Who else satisfies that need (competitors)?
  • Given the competition why should a customer choose us?

Pin the answers to these questions to a wall, or somewhere they can be easily referred to, make some assumptions, then challenge those assumptions using appropriate analysis and data collection techniques.

Marketing Analysis – Key Steps

The key issues to consider are:

  • Products and Customers
  • Environment
  • Resources
  • Competitive Environment

Product and Customers

Includes both a historic element and a projection into the future and includes:

  • Historic data on key products and product groups including quantity and price trends.
  • Current key customer analysis including establishing why they first became customers and what it is that stops them migrating to competition.
  • A detailed market segment analysis – both existing and those to attack.

Environment

The PEST analysis tool can be useful to assess the larger environment, its existing and potential future impact on the business and the business of key competitors.

Resources

A Value Chain analysis may be performed to analyse what resources the business currently employs to deliver a competitive advantage. How can these resources be better utilized in future, what is currently weak / missing and what new resources may be required to take the business forward.

Where possible resources should be classified against any established industry norms. In war (and in business) it is the side with both the most resources and the best method to deploy those resources that wins. Any business therefore needs to analyse carefully its available resources and how they may be best applied for competitive advantage.

The Competitive Environment

Porters’ 5 forces analysis is a good place to start. It covers the threat of new entrants to a market, the threat of substitute products and the bargaining power of both buyers and suppliers. This is an essential analysis tool to understand how the market may change and adapt over time.

Conclusion

The B2B market analysis process then is both complex and time consuming. With the data in place it is possible to take the next step and create a number of potential scenarios (based on the solid data collected), decide which of those scenarios is the most likely and a potential way forward for the business. Eisenhower said ‘plans are useless but planning is everything’ perhaps he was referring to the power of the analysis and scenario phase.

Can A Content Marketing Mentor Add Value

It is difficult to avoid the hype about content marketing (it is everywhere) but is it really of value to businesses in B2B markets? If a quantifiable ROI can be identified then is it best to go it alone or invest in a marketing mentor to guide you through the process?

The (Alleged) Value In Content Marketing

The theory behind content marketing all appears valid. It states that prospects and customers have grown weary of push marketing techniques. They no longer rely on suppliers and intermediaries to push out the information required to make purchasing decisions but actively seek out what they need long before engaging with a potential supplier.

Information (content) that supports potential customers information needs during various parts of the awareness and purchasing process, delivered to a point it is most likely to be read and engaged with is (it is suggested) a far better way to progress the sales process than push techniques.

The theory goes on to state that with strong content in place it can then be used to build high quality inbound links to the business website, increasing the effectiveness of the SEO process and driving the website up the Google rankings. Content may also be used to fuel social media channels such as Twitter and Facebook and increase both reach and potential customer engagement.

The Problem With Content Marketing

All of the above theory is valid and sounds wonderful in principle but there are some key problems to address. The first problem is the ‘build it and they will come‘ mentality. What complete nonsense, nothing is going to waste your time, effort and hard earned cash faster than buying into this mentality. Content must be marketed and delivered by the most appropriate means to reach the target audience.

This brings in the second problem and that is the need for a cohesive plan and strategy that details the target audience, what their individual information requirements may be at various stages in the buying process and (critically) where they look for that information. Without this in place a significant amount of time will be wasted on content that is of little use to the target audience and / or never reaches them. The most obvious resource customers may look for information may be on the web but it is important not to forget offline sources and the power of recommendation and word of mouth

Finally, there is the issue of the time required to build and deliver content. It takes time to create blog posts, slideshares, infographics and other valuable and engaging information from scratch. It is therefore important that the maximum benefit is extracted from the content, it is re-used in as many different forms as possible and it is distributed appropriately. Every effort should be made to seek out information the business already has in place that may be updated and re-used and this should be mixed appropriately with new content to minimise the resources expended on content creation.

Is There Value In Employing A Mentor

In 2015 any business can build its own, content based, inbound marketing process. The issue is the time taken, the resources employed and the time wasted following blind alleys and the often misleading information published online. An alternative is to seek out a mentor that uses content marketing in their own business and is experienced in what works well (and what does not). Although a mentor comes at a cost this should be measured against time and resources lost if they are not available to help guide you through the process.

How To Create B2B Case Studies That Generate Results

Recent research from both CMI and IDM shows that B2B businesses see case studies as a key promotional tool. It is therefore a surprise that case studies from mid-sized B2B companies are not more widespread. The problem could be the time and effort involved or it could be many businesses simply do not know where to start.

So what is the science behind the power of case studies, testimonials and recommendations? According to Dr Robert Cialdini in his book ‘Influence – The Psychology Of Persuasion’ one means we all use to determine what is correct is to find out what other people think is correct. For further evidence just consider the number of advertisers who love to inform us when a product is fastest selling, or fastest growing (German Caffeine based shampoo the power of case studies in b2b marketsanyone!).

If several testimonials show our peers are using a particular product or service then maybe we should consider it too? Even more powerful if we read a case study on how one of our peers used a service to create a positive result then it is certain to have a positive influence on our own decisions.

Like all the best marketing strategies a process is required. The first crucial step is to define the target audience for the case study. Who do we wish to influence, where are their pain points and what types of solutions are of potential interest? It is often best to restrict case study collection to a selection of the customer base and to ensure that a number of studies are collected to cover all of the key product ranges or services delivered by the business.

The next step is to put a process in place to gather the required material to build the case studies. This, at some point, involves asking the customer if they will agree to a case study and that is a problem for many businesses. This hurdle can be overcome by taking a multi stage approach (read an example here) and asking first for customer feedback then building from there.

A mistake made by many businesses is to restrict the detail in the case study so it covers a maximum of two pages. This is a mistake as the case study must be of an appropriate length to really address the needs of the potential customer. The case study needs to show:

  • What the business was trying to achieve.
  • What barriers were stopping them from reaching their goals.
  • What persuaded them they needed to do something about the problem.
  • What did they try and (if possible) why did it fail.
  • How did they come across your solution.
  • How did they implement your solution.
  • What were the results and how did they match against goals.
  • What were the costs (time, resources, financial) and therefore what was the benefit.

A little promotional material written around the customer that provided the case study illustrating what they do and the benefits they offer is always worth including.

Any case study always needs customer sign off before publication. The issue then, given the considerable effort expended in generating the information, is to maximise its benefit. It should be published on the company website and wherever else it makes sense online. It should be used by the sales force as powerful sales collateral. It may be used in print media and brochures and spread liberally around reception areas and finally it may be used in E_Newsletters and even email signatures.

An Integrated B2B Marketing Campaign Vs The Ad Hoc Approach

It may come as a surprise but spending money on ad hoc marketing in a short term push to make the year-end sales figures is unlikely to succeed. Following the latest and greatest marketing trend just because everyone seems to be doing it is often not the best idea.  It may take longer, it may take more effort but in the end a integrated B2B marketing campaign is all that can be relied on to deliver medium to long term, consistent, results.

A structured approach requires a solid understanding of where the business is going, a plan and (crucially) the courage to abandon the short term view and allow the plan the time to produce. An integrated marketing process delivers:

  • Structure and measurement
  • Improved results
  • At lower cost

Structure And Measurement

Reactive marketing tends to focus on the number of prospects hit rather than considering if those prospects fit the target customer profile. A more sensible approach is to build a yearly promotional plan focussed on the marketing techniques with the best chance of engaging the target prospects

Using historic data, carefully considered assumptions or reputable industry data it is then possible to relate the promotional plan to expected (quantified) results. Assuming the plan is based primarily on marketing techniques with a measurable outcome it is then possible to measure results against the plan and make solid decisions on spend based on what is working well (and what is not).

Reduced Costs And Improved Results

It has been shown many times in B2B markets that a drip, drip consistent flow of marketing messages to customers and prospects is far more effective than one off, or short term bursts, of activity. It therefore follows that the ROI on marketing spend on a consistent plan must exceed that of the Ad hoc approach.

Activities that are reactive and short term naturally tend to cost more than activities that are planned in advance allowing time to consider the best suppliers, offering most value. Following latest marketing trend simply because everyone else appears to be doing it without thinking through the outcomes has been shown time and again to be a waste of time and money.

The Process

The first crucial step is to establish (top level) what it is the business delivers to its customers, why that product or service is needed and who needs it and why. It is also important to understand who else satisfies the same need (competition) and how they go to market.

Only with the above step in place is it possible to establish the best way to reach the target customer base. What are the best marketing techniques to deliver information to the point prospects may find it and engage with it? Once a prospect is engaged what are the best marketing tools and techniques to convert interest to enquiries and ultimately orders?

While the old outbound techniques such as telemarketing, direct mail and advertising all still have a place there is increased prospect resistance to these techniques and an ongoing shift to inbound marketing as a result.

Inbound marketing is all above producing useful information (content) and delivering it to the customer / prospect base by the appropriate medium at the right time. Inbound marketing dovetails with a variety of online marketing techniques that are often measurable and relatively cheap to implement.

An integrated B2B marketing campaign that integrates the best inbound and outbound marketing techniques to fit a given situation is far more effective than an ad hoc, inconsistent approach. However, it must be accepted that it does take time and considerable effort.

Generating Creative New Product Ideas – B2B Markets

In many B2B markets what was once a unique product or service is soon copied, often by low cost producers, making it a commodity and driving down price. The challenge then is generating creative new product ideas on an ongoing basis.

However, there is a problem concisely put by Claire Mason in a recent ManBitesDog post ‘despite the critical importance of ideas-led selling, B2B marketers face an uphill struggle to generate the big ideas their organisations need. Four in five marketing leaders believe that B2B marketing is facing a crisis of creativity according to our latest research’.

So what is the solution? The obvious may be to poll the views of the sales department or ask your customers but as outlined in our post ‘Customer input to the new product development process’ both routes have their problems. What is required is a person (or better still a group) with both an in depth understanding of the market and its needs and the creativity to deliver a product or service that offers a unique solution.

The problem is such people are in extremely short supply. Worse still when they do exist in organisations higher management often lack the vision and market understanding to back them and put the resources in place to develop their concepts further. The statistics on new product failure are well known and risk adverse organisations are often unwilling to take a punt on a new product concept.

Where new product ideas do often flourish is where the person with the idea is also the business owner. He or she does not need to convince anyone it will work or plead to management for resources (they are the management) but if the product is a success this route tends to bring problems further down the line.

The problem is many start up business owners are superb product people with a detailed understanding of the marketplace but are poor managing directors. They understood the product and market but sometimes also lack the capability to communicate their latest new product concept to company personnel leaving them as the only person to really take it forward.

The real creative product people often are sidetracked (or promoted) into a position where they can add less value. For a company to thrive this rare resource needs to remain on the front line, interfacing with customers, intermediaries and sales and marketing. The risks of new innovative new products are significant but perhaps the long term risks to the long term future of a business of not taking the risk are greater.

If that elusive person with the creative vision and the market knowledge can be found they should be backed, rewarded appropriately, and left in the position they can deliver the most value.

4 routes to increased B2B sales

It is all too easy for any B2B business looking for increased sales to opt for the short term fix of hiring new (or replacing underperforming) sales resource. Sales people with an existing potential customer contact base or from competitors are often seen as a low risk route to more B2B sales.

To be fair simply recruiting a sales person can sometimes work in the short term but to really achieve long term sales growth requires vision and the courage to see through that vision in the face of considerable risks. In this post we cover the four most common routes to increased B2B sales and consider the value and level of risk of each.

There are four main routes to increased sales over the medium to long term, they are:

  • Market penetration.
  • Market development.
  • Product development (upgrade/variant).
  • True new product development.

However, before setting out on any journey it is important to note your starting point, your destination (gap analysis) and a return route should you need it so it is important to have a solid strategy in place. Know your customer and have firm plans (and processes) in place to retain those customers.

Market Penetration

Market penetration strategies are based on delivering existing products to existing market segments. They are therefore primarily based on taking competitor market share and/or increasing the quantity, mix or value of product taken by existing customers      

This approach is by far the most common and explains the ‘new salesman’ approach outlined above. The dynamics are well understood and customers and their preferred products well documented. There is also usually an intimate understanding of the competition, their strengths and weaknesses and their key accounts.

There are limits to this approach. For existing customers to take more their business will need to be going well and that is not something that can be controlled. Opportunities may arise if a competitor drops the ball in a key account but in general they are not going to give ground without a significant fight. Concentrating on market penetration leads to a ‘me too’ approach that can only impact on price and margin in the medium to long term.

Market Development

Market development takes existing products to new market segments or converts current non users of the product or service to customers. A strategic approach is required to identify the best segments to attack but once in place market development usually delivers higher sales growth than the market penetration approach.

The challenge is to gain a foothold in new market segments probably against entrenched competition. Hiring those with specific expertise of the segment may be a short term (but expensive) solution but in general an awareness and credibility building campaign will be required before any real results materialise.

Product Development

Product development can be a route to sales growth. It may be a new market segment will require a variation of an existing product. Market niches may be identified that need particular products or variants. A classic example in the electronic component marketplace is taking a standard product and protecting it, screening it and qualifying it for use in extreme environments like the oil and gas industry.

The product development route, if implemented correctly, can reduce competition, increase sales and increase margins but a robust approach to market analysis and planning is required. Investment in product development will be required with that comes an element of risk. Combined with the market penetration and market development approaches outlined above it may be sufficient to deliver the required growth but if a step change is required then only a true new product development process can deliver.

True New Product Development

A true new product development is not simply a development of an existing product – it is something entirely new to the marketplace. However, it is not that easy, look around in any marketplace and there are not many products that are actually disruptive and really new and innovative.

Finding these new products is far from easy. A logical approach may seem to be ask existing customers but as Henry Ford said ‘If I had asked people what they wanted they would have said a faster horse‘. The product idea therefore often needs to come from within and those with the appropriate vision are few and far between.

If a new product concept can be identified the problems do not end there. Bringing a true new product to market carries significant financial risk but, if successful, the rewards can be substantially higher than those available from the other three strategies combined.

Should you wish to discuss growth plans for your business and how they may be achieved please call on 01670 513378. We cover the North East of England including Tyne and Wear, Durham and Northumberland.

The Problem With B2B marketing Strategy

Let me get one issue out of the way straight away I am a big fan of B2B marketing strategy but too often the strategic planning process fails to achieve the desired outcome. Many strategic plans that take extensive time and resources to produce then spend time gathering dust on the shelf. In his re-thinking strategy lecture Sir Lawrence Freedman (really worth a watch if you have 30 minutes to spare) quotes Mike Tyson – ‘Everybody has a plan until they get punched in the mouth’ and therein lies the problem

The Theory

At its most basic level a strategy is a means to control future events. It is a process to get from where you are now to where you would like to be. Based on a detailed analysis of where the business is now, how it got there and the likely future shape of the marketplace it builds possible scenarios for achieving the goal. Those scenarios are then analysed a way forward chosen and plans put in place along a path to reach the goal.

The Problem

The plan assumes if we do A then B will unfold but the real world of business is populated by people and they do not always act (some would say rarely act) in a way that is predictable, or even logical.

It is true that a plan could be built based on if A happens we do B or if C happens we do D but what happens if several issues do not fall into place as expected at the same time. People, markets and the World in general is unpredictable. A military planner once said (I paraphrase) ‘No battle plan ever survives first contact with the enemy’

A Possible Solution

Another great quote from Sir Lawrence Freedman’s lecture. Eisenhower said Plans are worthless but planning is everything () and that perhaps is the key – it is the process that matters.

The solution may be to employ a less rigid strategic planning process in B2B markets. Months, perhaps years, of planning went into D-Day. I guess Eisenhower and his generals new little would go to plan but that they had a basic structure in place.

They were probably well aware they would need to rely on their men in the front line and their immediate commanders to modify the plan (or what was left of it!) as the situation demanded. If the tanks did not turn up, or the enemy strength was more than expected the men on the ground needed to find a way to get off the beach. However, once they were off the beach they were well aware of what the plan stated as their next task.

The long established B2B strategic planning process remains valid but it does not need to be as resource intensive or as rigid. It does not need to be complicated but it does need to cover the basic key issues including what do we sell, what need does it satisfy, who needs it and why.

Analysis remains a key process as it is important to understand exactly where the business stands and why but given the uncertainty factor any analysis that tries to predict the future is perhaps futile. Scenarios should still be constructed so the business has at least thought about what may happen and potential solutions.

Objectives remain important for the short to medium term but tend to be irrelevant in the long term. Overall the basic plan should be understood by all but it should be flexible and a living document that changes and adapts. Perhaps all that is fixed should be the start and end point.

Why All The Hype About Branding? – A Voice From The Wilderness

As a professional B2B marketer I get the value of branding but I also believe all the hype surrounding it is doing serious damage to the marketing profession. Taking a straw poll of both business owners and the public in general I believe would show most believe marketing is advertising or branding and that is a problem.

I am not saying branding does not have a value but to give an example from our ancient ancestors. Art flourished in the ancient Greek, Roman and Egyptian societies but less so in others. Why? Because in those societies food was plentiful and the society was well organised and structured. My point is this – if your prime focus is having enough to eat in the coming days and weeks and defence of your family you are not going to worry too much about your artistic side. Now swap branding for art and food for orders and perhaps you get my point.

In my humble opinion marketing prime purpose is to generate high quality and relevant leads for sales to close – that is it. That may not appeal to those with a creative side or have aspirations for marketing to be at the centre of every business but I am afraid it is time to wake up to the reality. If marketing can only talk brand it will have very little relevance to the wider business community.

Perhaps the problem starts at the very top. The Chartered Institute of Marketing (CIM) has a major programme underway (#Marketing2025) to try and make itself more relevant. As a member of the CIM since the early 1990’s and a Chartered Marketer I read the recent article by the CIM Chief Executive on the subject in the CIM magazine.

Remember, this article was about making the CIM more relevant but in the entire (lengthy) article ROI was mentioned once and lead generation not at all. The word Brand was repeated many times and it may well be important to larger organisations but if the CIM wants to be relevant it needs to talk to the majority of businesses (and marketers).

Let me explain, I have spent over 25 years in the small business (from start-ups to businesses with £25m turnover) environment. As over 95% of the 4.9m businesses in the UK employ up to 9 people and 99% employ less than 250 people in (figures from 2013) then I guess I am not alone. Yet, all the CIM focus is on branding that is probably only a prime focus for perhaps <5% of the total business population.

In the SME world everything has to deliver a ROI. Business owners may get the value of authority to their business but not brand. It may be argued brand is at the central to any business but good luck selling that concept to SME’s. If I had any influence at the CIM (which I don’t) I would minimise the use of that word.

To use another example there is a phrase in football that goes ‘earn the right to play ‘. For the uninitiated it means that the creative players in a team (the ball players and goal scorers) don’t generally get a chance to have a major influence on a match until the early physical battles have been won. They may not like it but in the early stages of a game the quality players have to put in a shift running, tackling and closing down with the rest of the team.

Marketing may translate to the creative players but to really influence and be at the centre of a business they need to get down and dirty with the rest, do their share, get out there and understand customers and sales issues. Only then do they have they earned the right to play. Only then can marketing claim its rightful place at the centre of business and provide real value with strategic focus, vision and yes – brand. However, forget that prime purpose of lead generation and all that good work will be undone in an instant.