Those words "Business has only two functions: marketing and innovation" - aren't mine, they belong to the business guru Peter Drucker, but they really resonate with me. Yet somehow in 2015, 'innovation' is the buzz word and is a favoured agenda item in Board room discussions, and 'marketing' is often seen as less important, more like a support function. More than once over the last few years, I have heard marketing referred to as "the Colouring-In Department".
Of course that was said in jest, but it does reflect a common perception across New Zealand businesses of where marketing ranks in terms of significance to the business, which contrasts with what I saw in many firms across Australia in my 10 years working there. I think this is a discussion we need to have as we strive to compete on a global stage.
My observation is that as organizations have gotten larger, we have gotten busier delivering against KPIs, and technology has enabled business decision making to be smarter. All of which has meant we, (the universal ‘we’, representing everyone in business, apologies to all of you who are winning at this already!) have more data, intelligence and tools, and are more connected with our customers than ever … yet at the same time, we are even more disconnected with our customers then ever before. They are a data point and a trend line at best.
We are less connected because we are often failing to value or develop a marketing strategy that is a core part of the business strategy. We have marketing divisions that execute marketing plans, or run on/off campaigns inline with annual budget allocations and maybe have some brilliant and engaging social media pages – often without any clarity over who the ideal customer is, how many of these they’re connecting with and what value they deliver to the business.
I think the de-ranking of marketing as a strategic function is in part thanks to the glory days of NZ’s lush advertising budgets and ‘Mad Men’ style firms (yes, some of these still exist!), advertising became ‘sexy’ (cue lots of champagne and 11 am starts), marketing became the internal function that outsourced all ideas to an agency, and ‘customers’ were those pesky things that could damage your brand.
If we want our businesses to compete and succeed in a hyper-connected global market place, then heeding Drucker’s timeless advice is key -
"The aim of marketing is to know and understand the customer so well, the product or service fits him and sells itself."
Exactly.
This is the fundamental principal of strategic marketing. This needs to be understood by everyone in your orgnisation and discussed in all leadership meetungs – know your customer, develop the product or service that best meets their needs, deliver it to them convenitlty and at a price point that they see as fair value, connect with them and then measure the results. Easy right?
Be consistent with this, have robust measurement tools and review these, have feedback loops and iterate as the market changes.
This is the beauty of working with startups – the Lean Canvas is now firmly entrenched in startup programmes and startup design across the globe. The Lean Canvas puts the founder/s and team in the customer’s shoes immediately. They determine the customer segments that may value their product or service, clarify the unique value proposition and the unfair advantage, and the channels they may use to reach the customers. Understanding the customer and how to compete for them is a foundation of the startup’s business strategy before they even green light the business. Tactics and fun campaigns come much later down the track and are an outcome of clarifying the businesses strategy.
Let’s make sure these startups don’t let the ‘strategy’ slip out of marketing as they grow in size, and let’s encourage customer focused strategy and marketing conversations across all stages of the business lifecycle. Getting clarity on the marketing strategy, executing it well year on year, will no doubt drive our businesses forward as they compete in a constantly changing and competitive market.
