Jul 30, 2009 | Marketing, Sales
Market share is probably the most commonly used non financial measure, almost everyone uses it who can access even basic market and competitive data.
The rub comes when you consider who is in the share.
A simple share number can disguise high customer churn, high costs to service, and significant investment in customer acquisition to counter the churn, all of which costs money.
The same share made up by a loyal customer base will deliver much better profitability, so having a way of discriminating between customers with differing levels of profitability should be a crucial underpinning of marketing activity.
Jul 30, 2009 | Innovation, Marketing, Sales, Strategy
The digital age has made the notion of copyright as an enforceable protection of an income stream outmoded. How then do you make money out of an idea?
In the past, people created stuff to be heard (or read, or seen) and that meant you could make money, because people were prepared to pay for the privilege.
In the present, and presumably, into the future, stuff is being created and everybody who chooses can hear you, for free, so the question becomes how do you make money from something you give away.
The answer is tangled up with what people do with what they hear for free, the value they can add in other ways than just flogging a single copy of a book, or CD.
Science fiction writer, blogger and all round interesting character Cory Doctorow has his books on his site, free to download, just click and there it is, saving in Australia at least $23.99 on a purchase. You can also order a hard copy, signed if you want it, and see the other stuff he has written, and get an opportunity to be exposed to his views.
As a writer, his objective is to get over a point of view, as well as making a living, and that happens any time someone reads his words. “Free Books” attracts them to the site, and often they end up buying, something, even if it is only into an idea. Most people prefer to read a book, so often an engaged reader will buy a copy of a book they have read for free, and they refer others to the book, buy it as gifts, and generally act as apostles for the specific book, and the body of work.
A number of headline bands are following the same strategy, download the music for free, and come to the concert, where they will sell you a seat, merchandise, an experience you will remember, and a place in the “triiibe”, the term coined by Seth Godin and explained in his book which he initially gave away, but has subsequently inhabited the best seller lists as a result of the value of the ideas articulated. That book gets referred to in places like this, and sales sometimes result, sales powered by the initial freebie, and the power of an idea.
Jul 24, 2009 | Management, Marketing, Sales, Strategy
The new conventional wisdom is to use the net as a marketing tool. I am certainly one who believes that the net is as influential as was the introduction of TV as a marketing medium, but the “rules” for brand building remain similar on the net as they have always been, just the emphasis, and degree of control of who receives the message is different. The focus of activity is now onto the individual, rather than a group of people who display some commonality.
The first and biggest challenge is to recruit visitors to your site, and gain their permission to engage with you, and this is getting harder by the day as the number of sites explodes, as does the sophistication of the strategies to attract users.
However, once you have a “user” to leverage the power of the net, you must:
Motivate consumers by using stories, have a narrative which individuals can use to guide their behavior, and that of their various groups of peers.
Engage with consumers individually, on some level, and facilitate connections amongst individuals who can relate to the narrative.
Leverage the power of the individual communication, by giving people something to do, a way to engage, a reason to buy.
Jul 21, 2009 | Management, Marketing, Strategy
Yesterday Telstra, Australia’s largest, formerly monopoly Telco announced that they would put a $2.20 administration fee on all payments made in person.
Even for Telstra, who have over the years dug up creative ways to convince their customers to go elsewhere, this is a coup.
Have the accountants finally taken over the madhouse? Is there anybody in marketing home (or are they all out to lunch with the ad agency?) Even if they are actually just catching up to the usurious practices of several of their competitors, the opportunity to spotlight the raping of their retail customers pockets has not been missed.
We all know that in-person service is more expensive than electronic, it is also a pretty good way for a business to connect with and understand its customers, but that is clearly of no value to Telstra who apparently know all there is to know about marketing and their customers.
Pity about the shareholders who have seen an impressive erosion of the value of their shareholdings, even before the impact of the WFC is taken into account. Is there a connection here?
So to the award, a new category, recognizing excellence in marketing stupidity, the “Twit Of The Year Award” (TOTYA) has been created to recognize Telstra’s excellence in pissing off customers. A stellar performance this year, on top of the continual failure of their bigpond servers to work reliably, a hefty premium sought for mobile internet connection, and just a general “get stuffed” attitude displayed to just about everybody throughout the year. Well done Telstra, a super performance!
Jul 21, 2009 | Demand chains, Management, Marketing, Operations, Sales
How long will it take for the politicians in this country to forge an acceptable compromise amongst all the interests in the carbon debate, and take meaningful action.? Probably forever, and we will end up with the proverbial camel after all the compromise, and that will suit nobody.
Enter the game-changer!
Wal-Mart, the biggest retailer in the world by far, turning over more than $US450 billion, more than most countries, has changed the game. Last week, they announced they would put carbon footprint information on display labels for all products sold in their stores. Suppliers will be required to assemble the information from their supply chains as part of their trading relationship with Wal-Mart
No recommendations, just the information, and consumers can make up their own minds.
The implications are mind-boggling.
In one decision, by one company, the nature of the debate about climate change has been turned from one seeking a political, emotional and academic compromise to a very simple choice for the Wal-Mart supply chains, do it or face deletion from their largest customer. Multi-national suppliers, Colgate, P&G, Unilever, Mars, and many others, will suddenly have another marketing lever to use in their marketing activities, across the world. Suddenly, weasel words in media grabs from pollies are even less meaningful than they usually are.
In Australia, Woolworths follow closely the steps taken by Wal-Mart, and what better way to put added pressure on its arch-rival Coles.
Suppliers to Woolies had better get ready!
Jul 19, 2009 | Management, Marketing, Sales, Strategy
On the surface, these appear to be the same coin, different sides, albeit three sides?.
Not so in business.
Foresight is often little more accurate than the musings of the gypsy at the local fair, whereas hindsight is capable of being 100% accurate.
Modelling has become the commercial equivalent of the crystal ball, offering the capacity to predict the future, but relies on the assumptions accurate in the past (seen with the benefit of hindsight) being consistent into the future, usually better than rubbing the crystal, but often not much.
Software has given us the false sense of security that comes with reams of paper with numbers all over it, and we often forego the benefit of experience, wisdom, and plain common sense, lured by the sirens song of the “certainty” generated by the numbers .
Bring back the value of common sense, and suspicion of anything that smacks of certainty when predicting the future, and we will all make better decisions.
