Crain’s: Review strategy before shifting marketing approach

As featured in the October 11, 2010 issue of Crain’s Cleveland Business

SMALL BUSINESS ADVISER: LAURA SHERIDAN

Before you invest more in marketing, take another look at your business strategy.

We’ve worked with many clients who want to grow their businesses. Often they’ve underinvested in marketing and then decide that to meet their goals, they need to spend more. However, marketing the wrong messages or using the wrong media tools wastes valuable time and money.

Sure, it’s important to advertise to attract buyers, but that’s often not the first step in the process. Instead, understanding what your target audience wants and being able to deliver it comes first.

After completing inexpensive and quick consumer research, our clients often learn that they need to refine their business strategy before developing a “new or improved” marketing plan.

Here are three real world lessons learned by other Cleveland businesses:

Real life lesson No. 1: The Power of Speed. A manufacturing company was growing and profitable but had never put a lot of energy into marketing. After being badgered by the board for the company’s unsophisticated marketing program, the CEO decided to invest more heavily in advertising.

The company engaged an ad agency and attempted to provide direction regarding what they wanted the advertising to communicate. This effort was wasted when the CEO quickly realized that they didn’t know what messages to include in their advertising.

After this initial misstep, and with the help of a third party, they devised a streamlined research plan to hear, firsthand, what their prospects cared about. While the CEO was convinced that he knew what they would say, he was surprised at the study’s findings. Prospects shared more about their perceptions of the company, its service and products with the third-party researcher than they had with the CEO or sales manager over many years.

The research identified a key insight that dramatically influenced the future of the company. They learned that speed matters. Prospects were clamoring for a company to provide fast delivery. So, the CEO changed its inventory strategy and manufacturing operations to ship faster. Only after this change was implemented was the company ready to invest in marketing.

By conducting research before embarking on advertising, our client was able to identify a message that resonated with its audience and differentiated its brand from competitors.

Real life lesson No. 2: The Importance of Quality. A medical device company’s sales were sluggish and they decided to focus on marketing. As a first step, they chose to conduct research to identify what was important to their target audience. They also probed to find out how their prospects wanted to receive their messages. Should their ads appear on TV, radio, the Internet, cell phones or in ways they may not have considered?

Once again, customer research led to uncovering a major customer insight which resulted in the CEO modifying his initial plan. During one-on-one phone interviews with a third-party researcher, customers and prospects talked about their need for quality products. They also explained that this particular company had a reputation for delivering products with inconsistent quality.

The CEO took the research results seriously and the marketing planning went on the back burner. Improvements to the company’s manufacturing processes and intense customer service training were implemented. After making quantified progress on product quality, the company was ready to begin marketing.

Real life lesson No. 3: The Value of Focus. A specialty consumer goods manufacturing firm had designed a new product and was ready to develop a marketing plan.

Unsure of which of the new product features to promote in its advertising, the company opted to conduct multiple online surveys. The investment of a few weeks and the minimal budget required to conduct the research turned out to be vital to the brand’s continued success.

The key insight uncovered with research was that the brand’s success was tied to being a niche player. The new product, however, targeted a mass audience.

Consumers were clear in their research responses. Part of the brand’s appeal was its exclusivity. So, offering a product for a mass audience would confuse and alienate their loyal customer base. The company abandoned the new product and focused its engineering and design expertise exclusively on products that fit its niche.

How do these real life lessons apply to your business? If you’re itching to put more energy into your marketing, re-examine your business strategy first. And, don’t forget to check in with your customers before getting started to ensure you understand what’s important to them.

Ms. Sheridan is president of Viva La Brand, a Cleveland-based marketing strategy and ad agency search firm. www.vivalabrand.com.