Thursday, March 5, 2015

War between Marketing's 3Ps & 4th P

According to American Marketing Association (AMA), marketing is the activity, set of institutions, and processes for creating (Product), communicating (Promotion), delivering (Place), and exchanging (Price) offerings that have value for customers, clients, partners, and society at large. Fundamentally, sales should be the subset of marketing and not considered to be different from it. But in reality this is not the case.

While every other discipline including branding, advertising, market research is under the umbrella of marketing, sales is set up as a complete different department.

In real scenario, marketing department handles promotion,branding and advertising based on market research and sales department engages into distribution and making product available to the customers. Marketing department handles 3 Ps of marketing mix i:e product, price & promotion and sales department handles 1 P, i:e place.

Sales and marketing are considered as India and Pakistan, be it in terms of their origin or in terms of their disputes. Just like India and Pakistan are children of same mother, sales and marketing have also evolved from same source which is marketing.

There has been a serious war between 3Ps on one side and 4rth P on the other side, to get more attention of the managing board in order to get more funds. This war is often not handled effectively by companies and they start differentiating between the two and fail to understand that both of these are as important as two sides of a coin, coin is worthless if either of them is absent.


Let us take a case of three men visiting a modern retail store to buy some groceries, Mr. Tom, Mr. Dick & Mr. Harry.
They all want to buy some noodles for their home and went to noodles section in retail store.

  1. Mr. Tom picked up Nestle Maggi noodles
  2. Mr. Dick picked up Horlicks Foodles noodles, and
  3. Mr. Harry picked up ITC Yippee noodles

Now the question which now arise is what made the sale of three different brands of noodles?
whether they were 3Ps which made the sales or the 4rth P which did the job?

There are many things which can influenced the sales of product like noodles

  • Brand consciousness of buyer
  • Price consciousness of buyer
  • Discounts and promotional scheme offered by retailer
  • Shelf space of a product

  1. Mr. Tom is a brand conscious man and thus purchased Maggi noodles because it comes from the house of nestle and has established itself as a reliable brand.
  2. Mr. Dick is influenced by shelf space and price and purchased home brand because it was given maximum shelf space and least price with a promotional offer of buy one get one free.
  3. Mr. Harry at last is a discount conscious man with some sense of brands and purchased Yippee noodles as it was offering a promotional offer of Sunfeast biscuit worth Rs. 10 free.

This was one case of purchase made by three men and their regular behavior. Now taking another case, a bit different one, one fine day, all three men went to buy groceries to retail store and again went to noodles section and this time,

  1. Mr. Tom picked up ITC Yippee noodles
  2. Mr, Dick picked up Horlicks Foodles noodles
  3. Mr, Harry picked up Horlicks Foodles noodles

Why there is a change in purchase decision of Mr. Tom and Mr. Harry.

  1. Maggi noodles is out of stock and thus brand conscious Mr. Tom went for a lower known brand Yippee noodles.
  2. Foodles noodles is also offering a discount of buy one get one free and it being sold at a lower price with a better shelf space catches attention of Mr Harry in a much stronger way than Yippee did.

After analyzing this case of purchase of such a general item of every household grocery list, can we say if marketing is responsible in getting a company profits or is sales making fortunes for the company?

This case showed three customers with different buying behavior, buying different noodles according to their preferences of the product specifications.



In first case of first customer, although marketing did its job in alluring brand conscious Mr. Tom to buy Maggi noodles, but later on when sales department did not met the demand of the retail store and it went on stock out situation, Mr. Tom shifted to Yippee.
Thus the whole marketing efforts by Maggi noodles went in vain because it was not able convert it into sales of product.


In second case, Mr. Harry shifted to Foodles noodles as he saw its advertisement on TV and therefore formed a perception of it being a good brand, whereas last time he did not recognize it as a brand and purchased Yippee.
Here the sales promotion scheme of Yippee noodles got overpowered by a TV commercial of Foodles noodles and thus sales department of Yippee was not able to make sales of product.

In first case marketing department was unsuccessful without sales and in second case vise versa. Therefore, each is incomplete without other, and both are equally important for achieving goals in any cut throat competitive industry which is every industry.

Wednesday, February 11, 2015

Six ingredients of Sales Elixir


Once a man said "Coming together is a beginning; keeping together is progress; working together is the success", that man is none other than Henry Ford, the man behind assembly line and modernization of manufacturing process. 

This success philosophy applies to manufacturing cars, which Henry Ford did very well, and also perfectly fits in achieving "Sales-success". But companies fail to follow this simple philosophy and fail to achieve sales success because of one disease, known as “Sales Phobia”..!!

Many companies are suffering from sales phobia, which may be caused due to a bad experience in convincing customers to buy their products, or may be due to inefficiency in managing their sales force. But there is an Elixir which will cure sales phobia and will also prevent this phobia to develop in future.

This Elixir is prepared by mixing unique six ingredients, which are:

Know your customers

The first ingredient for the potion is to know about your customers. Since the customer is the reason for the existence of any company, sales success cannot be achieved without knowing your customers.

This can be done by conducting market research to understand:

  • The wants of your potential customers,
  • Their preference for product quality, price and service and 
  • Their buying behavior, purchase pattern and frequency of purchase 

Know your competition

Once you know about your customer, second thing which has to be considered is the evaluation of competition. Competitors are already present in the market with their offerings and you are the one who is going to eat their market share, the intelligence of each of your competitor is necessary. You should know their strength and weaknesses to effectively beat them on the playground.


Know your offering


After you know about your customers and the competition you have to deal with, the next thing you have to focus is on your offering.

  • Don't sell what you made, but make what will sell.
  • Know your unique selling proposition and make it available in the market.
  • You have to choose what to offer, at which price to offer, where to offer, and to whom to offer. 
  • Either to enter in red-ocean or identify the blue-ocean and quest for it.

Know your sales process

The next thing which comes into the picture is the sales process you choose for making your offering available to the customers. 

The type of sales process is selected according to 

  • The product or service you offer 
  • The industry norms 
  • The process used by competitors 


According to above points, you have the following decisions to take
  • Whether to focus on channel sales or direct selling 
  • Whether to use brick and mortar stores or online sales or go for Omni-channel 

Know your sales force

Sales process and channel lay the foundation for next level which is the sales force you appoint.
Companies make mistake of hiring more sales force and flood market with their sales force, and have perception that this will give them good sales, but the things that really should be done are:
  • Hire fewer people and train those people according to your requirements. 
  • Identify the potential of the present sales force, motivate them regularly by giving training and incentives in cash and kind. 
  • Work on increasing individual productivity rather than increasing number of people by using technology and reduce the complexities of the sales system 
  • Increase customer facing time by reducing time wastage by a better division of sales territories. 

Know the perfect fit in all five

All the above five ingredients are equally important and none of them could be neglected. Where most companies fail to prepare their potion is when they overlook the importance of one or more ingredients.

This last ingredient is the base which is necessary to bind all the other ingredients together and without this all the other ingredients will be ineffective.

Having all the six ingredients and matching them perfectly will cure sales phobia and will lead the company to sales success.

Monday, December 29, 2014

The Marketeer's Web


Moving from one end to another in a predefined pattern, meticulously designing and integrating silk threads together to form a mesh like structure, that is how a spider creates a spider's web. Spiders are known to catch their prey by trapping them in spider's web and once any prey is snared in it, chances of its survival are next to zero. Not only this, spider's web is also the saviour of spider from any enemy attack and calamity.

Humans have always learned from nature, animals, insects and all the other entities of nature. Many product designs and concepts have been outcome of inspirations from nature, so this time what a marketeer can learn from a spider and its web!?

It is something which has changed the whole marketing across the globe. It is not just a marketing tool, but a whole strategy which enables a company to entrap its customers more effectively and efficiently than before. I coin this as "Marketeer's Web", which gives competitive advantage over the other players in market and also adds lubrication, which is required during rough days of market.


Why do Marketeers need Web !?

With increasing awareness among customers and increasing competition in market, it is becoming more and more difficult for the companies to survive on the small share of pie they get out of whole pie. If a company tries to have more share, it had to spend more money which is not always possible and this was the reason for cremation of many companies.


This created need of developing some technique so that a marketer can get more share of pie while spending same amount of money. Earlier marketeers tried to communicate to customers by randomly spending money in different channels by their gut feeling or by industry standards. That might worked in some cases, but in most of the cases customer used to forget about the offering because the communication was not able to sustain in his mind.


What is Marketeer's Web !?

Just like a spider creates web to snare its prey, a marketer creates a marketeer's web to persuade his target customer to buy his offering. Marketeer's web is a timely planned and well integrated exposure of communication about an offering which a marketeer want to sell to his customer. It is planned, designed and executed in order to get a position in the TOM (top of memory) recall of the customer and maintaining the place there until customer himself wants your offering.

Let me explain the idea of marketeer's web by a real life example,

This web starts from a direct mail received by a QSR (quick service restaurant) for trying out an offer on their new pizza. I ignored that mail as likely to be done my most of us. I switched to a new tab of the browser, opened Facebook, was scrolling down and saw the same offer which I got at mail. Then I opened Youtube and clicked on a trending video to watch. What can you expect at this time..Yes!! an advertisement which I could not skip and it was again of the same offer by same QSR. 

I went out to my friend's place and on my way I turned on radio in my car, listened to one song and next thing which comes up is an advertisement of the same offer as that of Youtube. At my friend's place, we switched on TV and saw an advertisement of tasty looking pizza and at the end mentioned same offer which I heard on radio. Before watching this ad, I did not want to have pizza, but after seeing tasty pizza I gave it a thought of having it. In next few minutes, my phone got new notification, it was a cash back offer by an e-wallet company on purchase of the same offer which was mentioned on TV.
The next thing I remember is me and my friend having the pizza from same QSR availed same offer and of course 15% cash-back too.

The above example shows the power of web which marketeer created around customers like me to trap us into their web. This has to be done in a very subtle way so that customer even did not realize that he is going to be trapped in web.


How to create this web !?

To fabricate spider's web, spider uses its silk, in the same manner for creating web marketeer requires some material which is provided in the form of communication channels.

The marketing communication channels includes:

  • Advertisements: TV ad, Print media Ad, Radio Ad
  • Public Relations: Press Release, Special articles, interviews, Cause activities
  • Direct Marketing: Direct mails, Direct messages, Shopping Channels, Telemarketing
  • Personal Selling: personal meetings
  • Sales Promotion: Loyalty Programmes, premiums, samples
  • Internet Marketing: social media marketing
Marketeer should knit his web around customers by utilizing communication channels appropriately.


Once having a consortium of channels to create a web, marketeer should focus on nitty gritties of designing the web, which includes following things,
  • Type of Spider and Prey: If a spider does not create its web according to the type of prey it want to enmesh, it should forget its meal and if a marketeer does not use communication channels according to the type of company he represents, type of product he offers and type of customer he is targeting, he should quit the job. Every company's requirement of communication is different, which depends on type of products it is offering and to which type of customer it is catering to. Hence, It is very important to select the right type of channel, in right quantity and at right time.
  • Understanding Prey: When a prey lands in spider's web, the spider is already aware of its next step and has prepared itself and its web accordingly. A marketeer has to understand the consumer behaviour and customer journey, both before and after his customer lands into his web.
          A marketeer should be clear about
    • What is the most effective channel for which type of customer
    • What will be the recall and recognition of his customers when they will be exposed to the communication
    • What would be the reaction of his customer on which type of communication channel.
        If he doesn't understand his customers, he will fail to design a good marketeer's web.
  • Web Design: Web fabrication, the way it is designed plays the maximum role. He should assess the actions of customers, design the web accordingly to assist customer what to do next, so that he straightway moves towards product purchase. If not designed appropriately, potential customers will be lost and expenditure to have one customer will be higher.

In todays fast changing world, moving with time is crucial for success and tactics like marketeer's web is going to be essential for survival.