Marketing is a commercial function not a shouty one

Before I got into the communications industry I sort of assumed that was what marketing was all about, communications or more accurately TV advertising. Understandable really, fresh out of college all I could see was the advertising on our telly, the big posters on the high street, and the press ads. I was wrong then and a lot of organisations are equally wrong today.

Too frequently marketing has become the home of what is perceived as useful but non essential type activities like advertising, CRM, Brand, Events.Thats is why marketing lacks board representation. It is an attitude even more prevalent in sales led organisations.

Maybe in some instances it is the right one but it is frustrating for marketers because marketing in the broader sense has the power to transform a business. Notice I didn’t say drive leads or sales. You have to set your sights higher than that. Marketing is, or more to the point, should be a commercial function not a shouty function. It needs to help the business address the big questions like.

Who are targeting? Who are we NOT targeting? What are they worth? What are we prepared to invest in converting them? What do they need? Why are they not engaging with us? Is our product or service fir for purpose? Is there a smarter way to distribute our product or service? How are we going to make money? That sounds like the start of a business case.

It feels as though the CMO has all too often become the CCO, the chief communications officer. The role of marketing has been split across multiple functions, including sales, finance, customer service; lots of owners but little accountability for the big picture. This is in stark contrast with Peter Drucker’s viewpoint on the importance marketing.

“A business has only two functions, marketing and innovation. Everything else is cost.”

Drucker’s perspective is difficult to argue with this especially now in a world where businesses are transparent, products are increasingly commoditised or  copied and such a premium is placed on customer experience.

So how is it going to change?

I wonder if the catalyst will be the recognition that we are now all in the business of service, every product brand is effectively becoming a service or it should do so. If you buy that idea then you tend to think of your business having two sides the customer facing half, and the internal half. The new CMO will be the CXO, the customer experience officer.

And with that the role of marketing is re-elevated. Job done.

The social media conundrum

Most businesses understandably see social media as an attractive opportunity.

• 200m blogs on blogger
• 100m Youtube videos watched every day
• 5,000m facebook minutes daily
• 38% of all on line media is on social media platforms
• 2/3 of the global internet population visit social networks and they are the 4th most popular on line activity
• 20% of twitter conversations mention brands

Every marketing director is drooling by this stage, because in their heads they have added word of mouth and FREE-ish into this heady mix. Lots of customers for next to nothing brilliant. A facebook page, a bit of twitter, followed by world domination and entering newly developed south American markets, all before tea time. Just in time for early orders at Corney and Barrow or Yates Wine Lodge, depending on how business is doing.

Now to bring everyone back down to earth (because that is what i have to do as a job more often than not) we could make a rational argument pointing out the resource, content, relevance demands and complexities. It would be dull and you won't remember it anyway. Lets try another way.

WH Smiths have just launched their facebook page and you can twitter with them when ever you want. How does that make you feel? Excited? Thought not. But point made, that is how customers may see your brand's social media activity. By the way WH Smiths haven't or i hope they haven't.

Everyday millions of people commute into London by train, they sit there for two to three hours a day. A captive audience, waiting to be marketed to. That is why i am launching my commuter marketing agency tomorrow. I suspect your first reaction is, he is an idiot. Second reaction is why not just put an ad in the newspaper at least they will have something useful (content) to read. Third reaction is, if you are still being polite, 'we will include transport in the media schedule if it fits with the strategy, thanks for your contribution'.

So just because the customers are there does not mean there is the opportunity to market to them. Social media is a really confusing term. Most of them are social networking sites not marketing tools waiting to be utilised.

By all means use social media to listen, or resolve, engage and participate if you can add value but don't think of it as a marketing panacea. And of course first work out what your customers want and if you can credibly provide a solution. Many brands have used social media well (Dell, Mini, Amex, BT) but they have invested considerable time and resource, they also know what they wanted to get out of it.

The social media strategy is easy, do things that customers want or find useful. It's the execution which is the tricky time consuming bit.

Re-connecting the marketing funnel

It's B2B again.

What exactly is a quality lead, our clients always talk about them but rarely does it get defined. The sales perspective is something like a prospect who invites them to tender. But this is not perfect, the likes of IBM, HP, Vauxhall will more often than not be on the shortlist as part of a benchmarking exercise. Marketing would probably define a lead as anyone who has engaged with the organisation, either via an event or on line.

Clearly there is a disconnect and explains why sales often complain about marketing, sales understandably want easy sales.

We could 'settle' the argument is by linking the marketing database to the website to ad serving data and other on line marketing activity. Easier said than done. But in the meantime if anyone has a better definition or two of leads (that marketing and sales agree on) i would love to hear about it.

When communications is just not enough

Imagine a time when marketing department headcounts are drastically reduced. The head of marketing turns to a consultant who brings in a few experts. They help with a bit of strategy, some research, the brand values, PR, the database and a bit of customer retention. The client loves it because he is in control of costs, limited overheads. He gets the expertise and people who do or will understand his business very well. And importantly their ambitions are aligned to his, no one to say behind his back to what extent he has got it all wrong.

And then when it all picks up, which it will i am just not sure about the timing, this team helps him run pitches for advertising projects, direct mail, web build. The purist communications agencies fighting it out on a project by project basis, best one wins.

Ouch.

But there again it sounds like a really interesting agency model.

Reinvigorating Brand Santa

Santa has won the hearts and minds of his customers. But growth is fuelled by population expansion, retention rates are average at best. The customer relationship starts round year three and fades year 7 to year 9.

Santa is privately owned so there is no financial reporting requirement. The business model is hazy; it is not clear how Santa makes its money. To grow the business you require cashflow or substantial capital. Property lease back is a non starter; they only seem to have seasonal concessions within a variety of retail outlets. Lapland HQ is not practical for other businesses of this scale. Opportunity cost of these assets would seem to be close to zero.

The solution to turning Santa around must lie on the revenue side of the equation. Here are our recommendations.

1. Santa, St Nicholas, Father Christmas, Papai Noel, Babbo Natale – the different names dilute the brand. Choose one name and stick to it. It worked for Snickers. Whilst a name that resonates with the Chinese market is tempting we feel an English name provides the greatest global reach. SantaServices gives you brand stretch.

2. Create added value services e.g. charge for different delivery options, delivering on Christmas Day should be the premium not the standard service. Charge for returns? Provide warranties? It estimated that 15% of presents are damaged on Christmas Day.

3. Merchandise yourself e.g. replica kits for children; think laterally! What would be the equivalent of the soccer away strip? What about a light suit for hotter climates. Don’t be a slave to red.

4. Investigate sponsorship opportunities. Formula 1 would offer the best benchmark. Look for brand synergies, but obviously avoid competitors like DHL, red letters days unless there is a clear income opportunity.

5. Branding. Make sure santaservices.com is on all packaging and clothing. “This present was bought you to by Santaservices.com”.

6. Embrace digital. Letters posted up chimneys is a nice touch but difficult to believe it is practical. How do you manage surges in activity? And of course it doesn’t feel very 21cn. Email has to be the way forward. Make the website work harder, a personalised web experience is essential. And of course this year we are expecting mobile technologies to take off so integrating SMS is a must.

7. Brand experience days help your best customers embrace the brand. It is probably Pizza Express No.1 marketing activity.

8. Business is over-reliant on one man; no one is going to invest in a business without a clear accession plan. Consider an X-Santa factor show.

9. Give Mrs Santa more of a role cf Cameron and Brown. Older men into children can be perceived as unusual e.g. Michael Jackson.

10. One day a year! Enormous opportunity even if we don’t go 24x7x365. Of course it is possible more frequent Christmases may be difficult to market but the core competence is distribution and logistics. Look to provide corporate outsourcing solutions.

11. Develop retention program for teenage into adult years, you know all about random acts of kindness. Put the Christmas back into CRM.

12. Appearance is everything. Looking that comfortable in the present climate does not seem appropriate. Even Puff daddy is forgoing bling in concession to the crunch. Obesity and children is a hot topic. Think about going on TV with Gok or Gillian Mckeith.

And finally, don’t get pissed in public and learn to dance Salsa.

Please feel free to add advice, Santa does read every comment. In the next few weeks we will be discussing God, Germany and WH Smiths.

Death of consumerism

It is not dead yet but from where i am standing it is looking pretty ill.

This downturn is changing the way people think, and for some time to come. It started off with us subtley changing our purchasing habits; one less coffee from Starbucks (or decent coffee shop), no evening paper at the station, having a simpler meal in the evening. It was all very illicit.

Only a year ago we were saying we needed whatever and putting it on the credit card. Now look at us. People are proudly saying we can't afford it. No longer do we have to justify going out for a cheap Pizza by saying the kids love it. Or explain away the old car on the drive with '... it is so reliable so i can't bring myself to sell it, anyway i hardly use it'.

Now of course I know I like to be different, and I make no effort to keep up with the Jones's. But it is still a bit of a relief not to contemplate it. So if this recession puts a dent in consumerism and makes us a bit happier about what we have, rather than unhappy about we haven't got then that will be a big positive. I just wish there wasn't the economic misery to accompany it.

I suspect there is going to be one big opportunity for honest, transparent retailers. But in the meantime watch out Aldi, Lidl, money saving sites, voucher codes, camping sites, car auction, Pizza Express (occasionally), H&M, ebay, freecycle ... here we come. And happy to admit it.

I suspect it is going to be called something like 'virtous thrift'.

Actually the Chorizo from Lidl is very good, you should try it.