I've been thinking about how to write this post, and the right phrasing is escaping me, so hopefully the idea comes out and it is not too muddled.
Basically, conservative marketing is no way to advance your position. You can't grow, and you can't change the game if you aren't willing to throw something out there. If you are Microsoft and you want Bing to be huge it has to be bold and different from what Google is doing.
As marketers, we have to realize that our customers are bombarded on a daily basis with messages and camapaigns and the like. They (and you as well) have become very good at filtering these messages. It takes something way outside the norm to get them to notice.
Maybe an example is a better way to look at this. Let's say that you manufacture widgets. And in your widget industry/market, it is standard for all of your customers to offer a 1 year warranty on these widgets. After that, customers can buy a service agreement or have someone else take care of their widget, but for the first year, they are covered. Now, if you were to decide that you would offer a two-year warranty, but only on Widget A and only for a few special customers, does this change the game? Maybe for the lucky few, but is the industry going to now turn to you for your Widgets? And what if you aren't the market leader in widgets? Is this enough to pull people to your side?
Now, what if you decide that every widget now gets this two year warranty? You tell everyone, if you buy my widget, you get this additional warranty! Does that change the game? Or what if suddenly your Widget is upgradeable to a Whatsit?
My point is, what is the point in developing a program if you aren't going to be bold about it, to do something that is going to get noticed and change the game? How can you expect to continue to grow and evolve if you aren't willing to step out and take chances?
As a marketer I try and ask myself if what I'm doing is going to help my company grow, if it is going to change the game, open new markets, help us be successful. If the answer is no, then why am I doing it?
Tuesday, February 2, 2010
Friday, January 29, 2010
It's time to fear the rack
Change is inevitable in today's work environment, especially for marketers. Information is disseminated at an incredible speed. Feedback is almost instantaneous. Consumer preferences and needs change rapidly. The only constant in today's marketing environment is change. Yet, in business, especially large businesses, we fight change. We exhaust ourselves trying to maintain the status quo. It's known, it's comfortable, it keeps most people employed.
But maintaining the status quo doesn't lead to long term growth. It leads to long-term erosion. Maintaining the status quo allows for other companies to move quickly, and take advantage of the ever changing marketplace.
So, why are so many people in businesses afraid of change? In his book, Survival is Not Enough, Seth Godin posits that those that fight to maintain the status quo face two different ways to "die", death by guillotine and death by rack. Death by guillotine is swift, painful. It's the idea that one big failure, and everything is gone. Fear of death this way looms large, and people avoid it. The thing is, no one fears death by the rack, a long slow death that is often more painful.
This idea really stuck with me. Not because of its morbidity, but because it really opened my eyes. In marketing, how often do we use the term "thinking outside the box"? It's the idea of breaking from the norm, but how many people are still grasping the box? Rather than going big they step outside the norm, but no so much as anything appears to be radical. But to a greater extent, how many managers drive this behavior? It's the fear of the guillotine, the idea that if I try or propose something radical, and it fails, my livelihood is on the line.
In order to be a successful marketer, not only do you need to overcome the fear of the guillotine, you need a support structure that encourages you to take those chances and those risks. In his book, Godin sites an example at FedEx. A failed idea ended up costing the company nearly $300 million. This was an opportunity for FedEx to drive the fear of the guillotine so deep into the culture that no one would ever dream of taking big risks again. Instead, they used it is a positive example. It galvanized the employees. It told them that if you are passionate about an idea or an approach, we will back you up. It encouraged them to take risks, and in the long run has lead to many rewards.
As marketers, in order to be successful, and to help drive our business, we need to not only step outside the box, but we need to get off the table, out of the room, and down on the street. We need to look for opportunities to embrace the change that we see around us and take advantage of the opportunities it presents. And, we need a support structure that allows us to do this.
Change is inevitable, it's how we, and our organizations handle it that will make all the difference in the long term. It's time to fear the rack more than the guillotine.
Wednesday, January 20, 2010
Reset...Refocus
It's easy to get caught up in the internal processes and hurdles that we as marketers face everyday (I plan on doing a post on this at some point). The trick though, is to not let these become the object of our focus. We fight, we get frustrated, we go back and forth, and ultimately we lose focus on what is really important, on why we do what we do.
I know that for me, the reason I got into marketing was because of the customers. Yes, I know that sounds a little altruistic, but bear with me. When I think about what I love (not like, but truly love) about marketing, it's trying to figure out how to convince someone out there that has a need that my product is the best one to satisfy this need. It means understanding what makes that person tick, what is important to them, how they think. It's like trying to solve a puzzle, each and every time. And in marketing (moreso than sales), I have an opportunity to shape not only the message, who that message is targeted to, how that message is delivered, and all of the various components of the message. I get to figure out how to make people aware that there is a message, find people that want to hear the message, and empower the sales team to deliver the message. I hope that a lot of people in marketing feel this way too (I would say people reading this blog, but I know there are only about 5 of you).
Yes, I spend a lot of my day working on reports, arguing over pricing, responding to urgent requests, and dealing with internal obstacles. We all do. The problem is when these things take over, and take you away from your customer focus. Sometimes, you just need to stop, take a breath, hit the reset button, and refocus yourself on what is important.
Today was one of those days for me. But now, I'm refocused on solving the puzzle that is a customer.
I know that for me, the reason I got into marketing was because of the customers. Yes, I know that sounds a little altruistic, but bear with me. When I think about what I love (not like, but truly love) about marketing, it's trying to figure out how to convince someone out there that has a need that my product is the best one to satisfy this need. It means understanding what makes that person tick, what is important to them, how they think. It's like trying to solve a puzzle, each and every time. And in marketing (moreso than sales), I have an opportunity to shape not only the message, who that message is targeted to, how that message is delivered, and all of the various components of the message. I get to figure out how to make people aware that there is a message, find people that want to hear the message, and empower the sales team to deliver the message. I hope that a lot of people in marketing feel this way too (I would say people reading this blog, but I know there are only about 5 of you).
Yes, I spend a lot of my day working on reports, arguing over pricing, responding to urgent requests, and dealing with internal obstacles. We all do. The problem is when these things take over, and take you away from your customer focus. Sometimes, you just need to stop, take a breath, hit the reset button, and refocus yourself on what is important.
Today was one of those days for me. But now, I'm refocused on solving the puzzle that is a customer.
Monday, January 18, 2010
The Best Kept Secret
"You may not have heard, but we have a great portfolio for this..."; "You probably aren't aware, but we've made great strides doing this..."; "You may not know, but we have the best..." The list goes on.
These comments are great when positioned to the customer. You can talk to your potential customers about all the things that you have done to make your product better for them. However, these comments are not good when you are telling them to your own team.
Something cannot be the best or the greatest or the most improved if no one knows about it, especially your internal audience. It drives me crazy when people tell me that I may not have heard, or I may not know. I work for the company, in the group, and I have no idea. How are my customers supposed to know? How am I supposed to market to them? Why are we keeping secrets from ourselves, and from our customers?
It's one thing to not tell customers about a project that is in the early stages of R&D, or to share proprietary information. It is a completely different thing to not tell customers that you've made strides in improving how you service equipment so that it is more reliable, or that you have a broad portfolio of products to help customers get more out of their current system. and it's a down right shame to not tell your own sales and service organization that you've been working on, or made these developments.
I've often heard the phrase "Best Kept Secret in the Industry". Why would anyone want this title? Basically it means you have a great product/service, but since you don't talk about it, no one knows about it, and thus no one buys it. This approach can really only go one of two ways. Either someone very vocal and influential finds out about your product/service and begins singing your praises, and you go from "Best Kept Secret" to "Best". Or, you remain a secret, languish, and struggle to survive.
It's not ok to simply talk to yourself about yourself; you probably are not the one buying your product (especially in my industry). Rather you need to talk to customers, and empower your marketers to do the same (this is a whole other discussion, but the basic premise is don't put obstacles up to prevent you from being able to talk to your customers).
Next time you catch yourself saying "We have the best widget", stop and think. Does everyone know you have the best widget? Or have you just been telling yourself? It's easy to be the best in your own mind. It's quite different to be the best to everyone else.
These comments are great when positioned to the customer. You can talk to your potential customers about all the things that you have done to make your product better for them. However, these comments are not good when you are telling them to your own team.
Something cannot be the best or the greatest or the most improved if no one knows about it, especially your internal audience. It drives me crazy when people tell me that I may not have heard, or I may not know. I work for the company, in the group, and I have no idea. How are my customers supposed to know? How am I supposed to market to them? Why are we keeping secrets from ourselves, and from our customers?
It's one thing to not tell customers about a project that is in the early stages of R&D, or to share proprietary information. It is a completely different thing to not tell customers that you've made strides in improving how you service equipment so that it is more reliable, or that you have a broad portfolio of products to help customers get more out of their current system. and it's a down right shame to not tell your own sales and service organization that you've been working on, or made these developments.
I've often heard the phrase "Best Kept Secret in the Industry". Why would anyone want this title? Basically it means you have a great product/service, but since you don't talk about it, no one knows about it, and thus no one buys it. This approach can really only go one of two ways. Either someone very vocal and influential finds out about your product/service and begins singing your praises, and you go from "Best Kept Secret" to "Best". Or, you remain a secret, languish, and struggle to survive.
It's not ok to simply talk to yourself about yourself; you probably are not the one buying your product (especially in my industry). Rather you need to talk to customers, and empower your marketers to do the same (this is a whole other discussion, but the basic premise is don't put obstacles up to prevent you from being able to talk to your customers).
Next time you catch yourself saying "We have the best widget", stop and think. Does everyone know you have the best widget? Or have you just been telling yourself? It's easy to be the best in your own mind. It's quite different to be the best to everyone else.
I'm back
Ok, I've been away from the blog for too long. I realized that I spent too much time trying to write the perfect blog post instead of just letting my ideas flow. It's time to correct that mistake, and use this as an outlet to comment on marketing good and bad, within and outside my own organization. Ultimately I don't want to be thought of as an employee of a certain customer, but a marketer first, industry specific second, and working for a particular company last. I hope that my ideas can spread beyond my day to day. And so, I'm going to try and return with a vengence, try to grow a little bit of a following, and see if I can't get my ideas to spread. Maybe then I can build my own tribe, develop my leadership skills, and expand my knowledge and understanding.
Thursday, July 23, 2009
A few thoughts on healthcare
So, it's been a little while since I last wrote (I blame lapse on Twitter, but that's a different post for an upcoming day). And while this is supposed to be a marketing blog, I wanted to get some general thoughts out about healthcare reform.
Overall, I think that anything that leads to more Americans being insured is a great thing for all of us. Right now 20% of all emergency room admittees are uninsured. But, the hospital has to treat them anyway. Additionally the number of people on Medicare and Medicaid is increasing, and we know that the government doesn't pay the same as the private payors. So, where do hospitals make up the difference? And what does this do to your standard of care? Think about it. The less money hospitals are reimbursed, the less they have to invest in necessary technology and improvements, to pay nurses and physicians, and even in some cases to continue operating.
I think most people are in agreement there. The issue tends to arise when we look at where the money is going to come from to pay for all of this. One of the areas that is quickly pointed to is medical imaging. Granted, the amount spent on medical imaging is rising every year. However, it is important to look at how imaging, when used properly (more on this in a minute) can actually save money in the long term. For example, let's assume that it costs $1,000 to do a Coronary CTA exam of a patient that presents with some basic risk factors. From there, the physician can assess any treatments that might be needed. Let's say these cost $5,000. Sounds pricey, right? Consider the alternative. The patient never gets scanned. Two weeks later he suffers a massive heart attack. He is then rushed to the hospital and has to undergo surgery. He is then in the hospital for a week to recover. I'd venture to guess that this proposition is not only less appealing to the gentleman that suffers the heart attack, but also that it is going to cost much more than the imaging and prescribed treatments.
That's the one aspect that seems to get missed the most. Medical Imaging, when used in the proper instances (those developed by physicians as generally accepted standards of care), is a very effective screening and prevention tool. If we look at costs in medicine, the majority are on the treatment side. Any time a disease or condition is caught in its early state, it costs much less to treat. If the focus is on prevention and screening, I would anticipate a long term savings in overall health care costs. Of course I'm not an economist, statisitican or anyone else that actually crunches the numbers, but...
(note: I'm not advocating the willy nilly use of imaging because there is always the real risks of overexposure. Thus the emphasis on proper usage).
Reform is definitely needed, and it's going to be expensive to do. I didn't really offer any solutions other than provide a focus on preventative care and screening, whatever that's worth. Just some thoughts as I'm trying to follow the process. I'm intersted to see where it will go, and ultimately how it will affect me both professionally and personally. It could generate a real marketing challenge, or it could generate a real marketing opportunity. At this point, it's hard to tell.
Overall, I think that anything that leads to more Americans being insured is a great thing for all of us. Right now 20% of all emergency room admittees are uninsured. But, the hospital has to treat them anyway. Additionally the number of people on Medicare and Medicaid is increasing, and we know that the government doesn't pay the same as the private payors. So, where do hospitals make up the difference? And what does this do to your standard of care? Think about it. The less money hospitals are reimbursed, the less they have to invest in necessary technology and improvements, to pay nurses and physicians, and even in some cases to continue operating.
I think most people are in agreement there. The issue tends to arise when we look at where the money is going to come from to pay for all of this. One of the areas that is quickly pointed to is medical imaging. Granted, the amount spent on medical imaging is rising every year. However, it is important to look at how imaging, when used properly (more on this in a minute) can actually save money in the long term. For example, let's assume that it costs $1,000 to do a Coronary CTA exam of a patient that presents with some basic risk factors. From there, the physician can assess any treatments that might be needed. Let's say these cost $5,000. Sounds pricey, right? Consider the alternative. The patient never gets scanned. Two weeks later he suffers a massive heart attack. He is then rushed to the hospital and has to undergo surgery. He is then in the hospital for a week to recover. I'd venture to guess that this proposition is not only less appealing to the gentleman that suffers the heart attack, but also that it is going to cost much more than the imaging and prescribed treatments.
That's the one aspect that seems to get missed the most. Medical Imaging, when used in the proper instances (those developed by physicians as generally accepted standards of care), is a very effective screening and prevention tool. If we look at costs in medicine, the majority are on the treatment side. Any time a disease or condition is caught in its early state, it costs much less to treat. If the focus is on prevention and screening, I would anticipate a long term savings in overall health care costs. Of course I'm not an economist, statisitican or anyone else that actually crunches the numbers, but...
(note: I'm not advocating the willy nilly use of imaging because there is always the real risks of overexposure. Thus the emphasis on proper usage).
Reform is definitely needed, and it's going to be expensive to do. I didn't really offer any solutions other than provide a focus on preventative care and screening, whatever that's worth. Just some thoughts as I'm trying to follow the process. I'm intersted to see where it will go, and ultimately how it will affect me both professionally and personally. It could generate a real marketing challenge, or it could generate a real marketing opportunity. At this point, it's hard to tell.
Wednesday, July 1, 2009
Is penetration pricing a lost art?
Maybe this one is a little more of a personal gripe and it doesn't happen to everyone, but in my world, it's something that's bugging me, so I'm going to write about it.
Any marketing text will tell you that there are two primary strategies when introducing a new product, penetration pricing and prestige pricing. Each of these has its place. For prestige pricing, a company needs to have an established brand, a loyal fan base, and a true differentiator of a product. The best example of this is Apple with the iPhone. They launched the thing at $400-$500 a pop and were selling out of them left and right. They were the most expensive phone and people paid. Since then, the price has come down as the masses have joined the early adopters. This is classic prestige pricing.
On the flip side is penetration pricing. This tends to be used by companies that are introducing more of a "me-too" type product, or ones that don't have quite the established brand. It's designed to quickly take market share away and validate your product. The early purcahsers get a "deal" because they assume the risk of a new company or new product when the established players already have something. Then as they validate, the price creeps up as more customers are willing to give it a try (actually in today's markets this seems to be more that the new player sets the new price and others come down, but...). You tend to see this played out in the auto industry.
Now, my gripe. If you are introducing a me-too product, you better have one helluva brand reputation if you are going to use prestige pricing. And if you don't have that brand reputation, don't expect to get premium pricing! If there is a company that has 6,000 pieces of equipment installed, and you are trying to get your first, why would anyone pay more?
By demanding a higher price for a me-too product, validation is delayed, the competition has more time to build a story against you, and the sales team feels an incredible amount of pressure. It usually ends in deep discounting, one off price reductions, and totally erratic behavior (at least in my cases).
Overall, it seems that there are many more examples of prestige pricing than penetration pricing. Sometimes prestige works, sometimes it doesn't, but it seems to be the preferred method (of course I could be in a bubble that doesn't see pricing in the rest of the industries throughout the world).
I could go on and on about pricing and theory and execution, but if you are still reading this, I don't want to bore you any further. I'll wait for another post where I can look at pricing with regards to the technology adoption curve. Then there is the whole market pricing vs. "I just need to cover my costs, market be damned" pricing argument. Or the one-of-a-kind pricing phenomenon.
But in the end, just remember, have you earned the right to prestigously price your product, or would it be better to gain users quickly to help validate?
Any marketing text will tell you that there are two primary strategies when introducing a new product, penetration pricing and prestige pricing. Each of these has its place. For prestige pricing, a company needs to have an established brand, a loyal fan base, and a true differentiator of a product. The best example of this is Apple with the iPhone. They launched the thing at $400-$500 a pop and were selling out of them left and right. They were the most expensive phone and people paid. Since then, the price has come down as the masses have joined the early adopters. This is classic prestige pricing.
On the flip side is penetration pricing. This tends to be used by companies that are introducing more of a "me-too" type product, or ones that don't have quite the established brand. It's designed to quickly take market share away and validate your product. The early purcahsers get a "deal" because they assume the risk of a new company or new product when the established players already have something. Then as they validate, the price creeps up as more customers are willing to give it a try (actually in today's markets this seems to be more that the new player sets the new price and others come down, but...). You tend to see this played out in the auto industry.
Now, my gripe. If you are introducing a me-too product, you better have one helluva brand reputation if you are going to use prestige pricing. And if you don't have that brand reputation, don't expect to get premium pricing! If there is a company that has 6,000 pieces of equipment installed, and you are trying to get your first, why would anyone pay more?
By demanding a higher price for a me-too product, validation is delayed, the competition has more time to build a story against you, and the sales team feels an incredible amount of pressure. It usually ends in deep discounting, one off price reductions, and totally erratic behavior (at least in my cases).
Overall, it seems that there are many more examples of prestige pricing than penetration pricing. Sometimes prestige works, sometimes it doesn't, but it seems to be the preferred method (of course I could be in a bubble that doesn't see pricing in the rest of the industries throughout the world).
I could go on and on about pricing and theory and execution, but if you are still reading this, I don't want to bore you any further. I'll wait for another post where I can look at pricing with regards to the technology adoption curve. Then there is the whole market pricing vs. "I just need to cover my costs, market be damned" pricing argument. Or the one-of-a-kind pricing phenomenon.
But in the end, just remember, have you earned the right to prestigously price your product, or would it be better to gain users quickly to help validate?
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