Recently I had the pleasure of speaking at Search Engine Strategies (SES) New York on a panel discussing social media and how it works with the marketing mix. I am a firm believer that while mass marketing and communications has driven marketers away from their roots of being “market-centric,” social media is the catalyst that is forcing those roots to be firmly planted again.
What does ‘Market-Centric’ Mean?
Typically learned in Marketing 101, the three stages of marketing evolution are usually forgotten by time the next semester starts and it’s definitely ancient history by time students of marketing start their first job. Let’s look at a quick overview:
- Product orientation: A focus on quality and quantity of output, assuming that customers would see out and buy items that were made well and reasonably priced. Typically demand for goods exceeded supply and finding customers and marketing is a relatively minor function. You could look at this mindset as “We build it, they buy it.” (Late 1800s – on)
- Sales orientation: A developed focus on sales as consumers tightened their belts resulting in less spending. Companies realized that they needed to stimulate sales and to do so they turned to advertising and aggressive sales tactics to move product. The typical management mindset is “If we build it, they will come.” (1930s – on)
- Market orientation: A recognition that companies had to build what customers wanted to buy instead of what they wanted to make or sell. A market-oriented company is one that understands its market well and doesn’t create product (or services) unless they know there is already a demand. That’s a “market centric” mindset. Management knows “We don’t build it, unless we know they will come.” (1950s-on)
The problem today, is that a lot of companies are still stuck in the product and sales orientation stages and consumers aren’t even aware of their products or are ignoring their pushy sales/advertising all together. There are many current challenges that this one post won’t answer, but I hope my slides from SES NY will get some wheels turning and demonstrate why companies need to become “market-centric.”
The Marketing Mix: Social media touches every aspect of the marketing mix from product development to pricing to distribution to promotion. But companies need to “listen” to what people are discussing online to take advantage customer and prospect wants/needs. For example “I really like X, but the price is too high.” If a company hears that sentiment more often than not, it’s time to consider your current pricing.
The Four Ps vs. the Four C’s: For sometime there has been argument that the 4 C’s should replace the 4 P’s in marketing. I think we need a combination of the two in an attempt to balance the need to be market centric and meet market demand, but also to meet the company’s goal and objectives.
Integrated Marketing & Communications: There seems to be a misnomer that “integrated” marketing and communications is simply about making sure marketing pieces match (i.e. seamless branding and messaging). That is only one part of what IMC is about. The main philosophy of IMC is to be data-driven. Typically, the only data companies could rely on was primary or secondary research or the data that sits in their CRM systems. Usually both don’t really tell you about the unique needs of your customers as individuals. That’s where social media can fill the data gap. Customers act completely different when they are in their “own online space” (i.e. social networks) than when they are being interviewed with questions that are orchestrated internally to either build upon an argument (“See, we proved there is a need for XYZ!”), develop PR (“Survey says…”) or get a pat on the back (customer satisfaction surveys).
Why Integrate Social Media: Another misperception is that customers interact with marketing pieces (direct mail, email, ads, etc.). They do not. What they do interact with are the brands that they have a relationship with. And now with social media, they don’t only interact with brands but the people that represent those brands.
Thirty Seconds: That’s how long you have to capture someone’s attention and change their perception or get them to act. By sending mixed messages or messages that are ineffective you’ve wasted those precious seconds and your budget.
The Problem with Integration: Silos. Companies function with too many silos. This is particularly an issue within marketing. There are too many functional teams, too many separate budgets and too many politics. At the end of the day, customers do not care about your internal silos and pandering to the silos is an ineffective way to do business.
Five Key Steps to Integration:
- Identify your customers and prospects
- Estimate the value of your customers
- Plan communication messages and incentives
- Estimate return on customer investment
- Evaluation and future planning
If you want to learn more about these five key steps, pick up a copy of Don & Heidi Schultz’s book: IMC The Next Generation: Five Steps for Delivering Value and Measuring Returns Using Marketing Communications.
Integrated Companies: I selected two B2C companies and one B2B company that I see as doing a great job to integrated social media into their marketing mix. They are Geico, Coldwell Banker and BreakingPoint. Again, it’s not just about cohesive branding/messaging, but listening and evolving.
Is your company market centric? If so, what are the benefits? If not, what are the challenges?