3 Steps To New Generation Marketing Practices for Emerging Businesses
Having access to new and exciting marketing tools is one thing; knowing how to use them effectively in alignment with a plan, is yet another. Emerging companies can't afford to spend hours on the web trying to keep up with the latest and greatest marketing practices, nor can they afford to spend their limited human resources to orchestrate the activities of multiple creative agencies. As a result, many emerging companies default to the "shoot-then-aim" school of marketing. The boundless creative energy and tendency to act at lightning speed that characterizes the typical entrepreneur can come back to bite them, when it comes to marketing execution! The most brilliant, award-winning marketing campaign that happens to be off-strategy is as good as throwing money down the drain.
Analysis-Paralysis, which is anathema for most emerging companies, is not the answer. But there's a middle ground between lightning-fast execution and slow/deep scientific analysis. There are three important steps that I would recommend, to all companies before moving to execution of marketing campaigns:
STEP I: Perform MarketScape Analysis and Build "Top 3" Competitive Profiles
If you did your own informal poll among small and medium sized firms, you'll most likely find that a very small number of management team members or business owners can put a dollar figure on the addressable market that they target, or know the market share of their top three competitors (or their own market share for that matter). Why? Usually because there's a perception that acquiring and internalizing market and competitive intelligence, is costly, time consuming and reserved for larger companies.
Needless to say, that is not the case. We are fortunate enough to live in an age where information is practically surrounding us. Understanding both the market you operate in, as well as the competitors that you are battling against is not only easily achievable nowadays but a key and core ingredient of success. Following are some of the key elements that I would recommend in this step:
- Trends: Look for existing analyst papers/studies or other third-party research identifying the top industry defining trends over the next 2-3 years. Extract only the most vital elements that may impact (directly and peripherally) your business. This is the cornerstone of all planning actions to follow.
- Scenario Planning: Pick the 3-5 most important industry trends described above and do a "war-gaming" workshop with some of your key people, to identify what your company would do if each of the forecasted industry terms actually materialized. Also try to envision what your key competitors may do and how you would react to their actions. Assign probablitiies to these scenarios and prepare the business for taking those actions if necessary in the future.
- Competitive Landscape: Pour over existing analyst reports summarizing market share trends, competitor SWOT analyses, competitive news and actions, and everything else you can get your hands on. If no usable information is available, commission a quick internal study or outside consulting engagement to get the basic intelligence you need (it should take no more than 10-20 man-hours to establish a relatively solid foundation of knowledge here, given the wealth of data available and how easy it is to access.)
- Competitor Profiles: Rule #1 in war is know your enemy better than they know themselves. Build thorough SWOT analyses (Strengths, Weaknesses, Opportunities, Threats) on each of your top 3 competitors and contrast them against your own SWOT. Look for areas where your strengths match their weaknesses best and put together single-page sales tools for each competitor, with specific "scripts" on how to attack them (or how to defend when they are attacking.)
STEP II: Customer and Prospect Analytics - Tapping the Gold Mine
Most small companies hear the word "analytics" and they head for the exit. The word invokes visions of overpaid consultants taking 3 months to come back with PhD-level material on intricate econometric theory and colorful custom-code dashboards that has little utility for a small business. Reality is that most customers are only within a few hours of gaining undiscovered intelligence about their customers and prospects that can make the difference between break-even vs profitability, and surviving vs winning big.
Whether it's retail POS (point of sale) data, a massive excel database with customer contact records, or web traffic data via Google Analytics or StatCounter, data is our friend. Data, however, will never transform into actionable intelligence unless we mine it appropriately. Here's just a sampling of areas that you can start with:
- Customer/Prospect Database: Almost every single customer has one. Whether it's stored as a Lotus123 spreadsheet from 1986 or a hosted, full-fledged CRM system like SalesForce.com, inquisitive minds running simple queries on the data and asking "what if" questions can surely yield quite a few pearls of wisdom from whatever is available. Do an aging report on your customer contracts, look for changes in churn rate, understand the upgrade path of your most loyal clients, etc. Add to your existing customer database any third party prospect lists and profiles that you've acquired (from vendors like D&B, Jigsaw or Hoovers), and you now have an opportunity to contrast and compare customers vs non-customers to sharpen your go-to-market approach.
- "Look Alike" Modeling: The premise is simple. Figure out the type of customer you are looking for, figure out what characteristics make those customers unique, and apply those characteristics to the rest of your database to help you find more customers that "look like" them. There are plenty of smart companies, employing very smart mathematicians and statisticians who have made this type of modeling (and many others) repeatable and accessible to companies of all sizes. One such company that we used extensively in a previous company is Sigma Marketing Group out of Rochester NY.
- Web Traffic Analytics: The detail and richness of web traffic information available was not even imaginable for the small and medium size companies two years ago. Only large companies could afford dedicated staff that used to shove raw web traffic data in complex visualization software packages, to end up showing you a couple of pretty bar charts of last month's page loads. With Google Analytics, StatCounter and other web-based applications like them, any business can have free real-time access to every bit of web traffic data imaginable, presented using highly customizable visual aids that practically make the information rise up and slap you across the face.
STEP III: Constructing the Marketing Plan
A wise man once said, "if you don't know where you are going, any road will lead you there!" Operating without a marketing plan will take you to the same place: nowhere. A lot of smaller companies have a tendency to skip planning in the interest of quick execution, so they fast-forward straight to picking a marketing tactic of the month and doing a "spray and prey" routine: trying different tactics through the year to see what (if anything) will stick. Clearly, not the best approach. The reasons for why they do that are easy to understand. Small businesses think that marketing planning is a lengthy exercise using expensive consultants who deliver a beautifully bound 130-page word document, which collects dust on the shelf until the next planning cycle.
Having built a few marketing plans in my 19 years in marketing and planning roles, I can tell you it doesn't have to take months nor does it take a genius to develop one (and it definitely does not need to be 130 pages long! A marketing plan is simply clear, rational thinking at work. It's a declaration of what the company stands for, how it wants to be positioned in the marketplace, and what tactics it will need to execute so it can grow. Following are what I see as the key elements necessary for a solid marketing plan.
- Strategic Intent: This is one of the most important elements of the plan. It describes in crisp and unambiguous language what you are aiming to achieve with your marketing efforts. How are you positioning the company? What does the brand stand for? What is your value prop and points of differentiation? Are you optimizing you efforts for revenue growth, profitability or market share (and the answer can't be all of the above!)
- Objectives, Tactics and Metrics: Think of this as a very simple pyramid structure. At the top of the pyramid is your singular strategic intent. It spells out what you want to achieve at the highest level. The next level, midway down the pyramid is a set of 4-6 objectives that break down what you are trying to achieve, into more digestible chunks. The bottom of the pyramid shows the "how" - a number of tactics per objective, that need to be executed successfully to support the plan. Finally, metrics are simply specific and measurable targets that you must set and track against performance throughout the year to ensure that you stay focused on the destination, and make course corrections when necessary.