This is the last of a three-part series in Marketing from the Inside Out. In the first article, I offered four guidelines for marketing: express your passion, honor your values, use common sense, and find a need and fill it. In the second article, I laid out a fundamental marketing analysis, which included the importance of examining core values at a corporate and personal level. Now we will explore how to create a values-based marketing plan.
The biggest obstacles in my life were usually put there by me. To quote the cartoon character Pogo, "We have met the enemy, and he is us." As a life coach, one of my jobs is to help people get out of their own way. In their hearts, they know what they want to do. They know right from wrong. They know when they are lying to themselves. They know they have choices. But sometimes they forget. Instead, they get in the habit of reacting to external demands, or following the herd, instead of listening to their own inner wisdom.
Hopefully the earlier articles in this series helped you gain some clarity about your product, your marketplace and your most authentic style of communicating your message. You also had an opportunity to explore your core values and to see where they were aligned with how you do business. Now it is time to put it together in order to gain some traction in today's mercurial marketplace. Begin with a situational analysis. This includes an external analysis as well as a self-analysis.
The external analysis includes:
- Customer analysis: What are the market segments, motivations and unmet needs?
- Competitive analysis: Identify who your competitors are and their relative strengths and weaknesses.
- Market landscape: This includes an industry analysis, the regulatory climate, etc.
The self-analysis includes:
- Performance analysis: What is your ROI, expected growth, etc.?
- Cost analysis: Define your sustainable advantage, experience curve, etc.
- Financial resources and constraints
- Strengths and weaknesses: Include distinctive competencies, assets and liabilities
- Strategic questions
- Identify your core values and where in your business you best honor them as well as where you would like to more fully honor them.
You are now ready to identify strategic alternatives based on your company strengths and core values. The goal is to develop a sustainable competitive advantage (SCA), which has three components:
2. The advantage needs to be substantial enough to really make a difference. This can be challenging in a saturated market, but becomes easier when one focuses on a specific niche.
3. It needs to be sustainable in the face of environmental changes and competition. This also speaks to how the company defines itself. The classic example is the railroad industry. Were they in the business of running trains or in the business of moving people and goods? How you define your business will have an impact on your ability to adjust to external factors.
There are three basic types of strategies: differentiation, low-cost and focus or niche.
- Differentiation strategy: To differentiate your product or service from your competitors, you must make it appear different in some meaningful way. This can be based on quality, reliability, innovation, level of service or product features.
- Low-cost strategy: This is self-explanatory. When you are unable to differentiate your product from someone else's (e.g., it is a commodity), the purchase decision is often based on price. The focus then becomes on controlling costs and reducing overhead in order to maintain margins.
- Focus or niche strategy: The focus strategy will involve either differentiation or low-cost, and it will target one or more specific areas of the larger marketplace. It will not attempt to compete across the board, nor be all things to all people. For small businesses with limited marketing funds and resources, it is important to choose these niches where you have the greatest sustainable competitive advantage.
To select the most appropriate strategy, consider the following questions:
- What is or what should be your business mission?
- What investment level can you make in the strategy? Which is the most cost-effective for your long-term goals?
- What is your sustainable competitive advantage? Which type of strategy (differentiation, low-cost or focus) best supports your SCA?
- Which strategy best fits your strengths, objectives and core values?
Examples of how this might apply to a product or service business are given below. Notice how the product or service offering reflects the values of the owner.
Chef's own salad dressing
Industrial cleaning business
|Mission||To bottle and sell well-known restaurant chef's private-label salad dressing to 1) begin product line and generate revenue and 2) publicize and increase name recognition of restaurant||To become the largest cleaning service of office buildings in the greater Seattle area|
|SCA||Award-winning chef developed this house-favorite recipe and uses it nightly in his famous high-end restaurant.||All bonded, legal-resident employees. Provides highest quality with lowest cost.|
|Core Values||Aesthetics, leadership, independence||Honesty, wealth, service/contribution|
|How Core Values Are Honored||Beautiful packaging and highest-quality ingredients. Branded products will contribute to long-term financial independence and enhance restaurant recognition.||Only using legal residents (even though illegal aliens would work for less). Carefully managing overhead, through computerized scheduling, multilingual checklists and other economies of scale. Helping the immigrant community by providing employment benefits, which also minimizes turnover.|
|Marketing Strategy||Focus strategy: gourmet cooks and purchasers of high-end specialty food items. Distribute through gourmet shops, online gourmet retailers, the restaurant and through its Web site.||Low-cost strategy. Highest-quality service for lowest cost.|
Pulling It All Together: The Marketing Mix
An effective marketing plan will address the 4 Ps: product, price, place (distribution) and promotion. The following decisions should be made based on your values, mission and strategic goals.
- Develop new product/service
- Change current product/service
- Add or drop product or service from line
- Product positioning: How are you perceived relative to the competition? What is your sustainable competitive advantage?
- Branding: What is the image you are projecting in the marketplace?
- Other product decisions: You add to list.
- Price level (above, same as or below competition)
- Price variation (discount structure, bundling of services, etc.)
- Margins (price less cost to deliver product or service)
- Other pricing decisions: You add to list.
- Intensity of distribution (Will your product or service be widely available or on an exclusive basis?)
- Multiple channels (How will your product or service reach your customers?)
- Distribution structure (Will you use intermediaries, wholesalers, retailers, sell direct, etc.)
- Other distribution decisions: You add to list.
- Promotional mix of personal selling, advertising, dealer incentives, sales promotion, direct mail, etc.
- Media (e.g. print, Internet, broadcast, etc.)
- Other promotional decisions: You add to list.
Two last things to think about:
2. Do not assume that you can make customers change their current behavior patterns. It is a much safer strategy to adapt to existing behavior patterns. Marketing does not "make" people buy goods and services. Wise marketers monitor the reasons people purchase and then adapt their programs accordingly.
The key to marketing from the inside out is in developing your skills of making supported and reasoned decisions that are grounded in a sound marketing analysis and are in alignment with your core values. The world is moving quickly, and the Internet allows your customers to educate themselves, compare prices, understand your company structure and even check you out as an individual. The BS detector is set on high, and it is the most authentic products and services, those that offer true value for an expressed need, by people with ethics and honor, that will survive and prosper.
Rebecca Cooper is a professional and personal coach who works with visionary people seeking to create and live authentic lives. She helps provide clarity, illuminate choices and reflect the passion of her clients. To explore what's next in your life, e-mail her at Rebecca@authentes.com or visit her Web site at www.authentes.com.