Marketing consultant Neville Stein articulates how a clear understanding of your business and the market can deliver sustainable growth in 2015.
Most of you will have heard the joke about the salesman being so good that he could sell refrigerators to Eskimos, but when you think about it, wouldn’t it be a lot easier just to sell them something they wanted in the first place? Selling should not be diµcult if the right steps and stages have been followed beforehand, and that process is called ‘marketing’.
In my experience many small and medium sized enterprises still only pay lip service to marketing. Perhaps they think of marketing only as advertising and selling. A common mistake – particularly as we are bombarded every day with sophisticated advertising through a wide range of media.
This very overt and clear promotion of a product or business tends to conceal the essential marketing process behind the scenes, which if neglected will lead to failure of even the most creative advertising campaign.
As leaders and managers in modern businesses we really do need to embrace marketing, but firstly we have to fully understand what it is. The technical definition as defined by the Chartered Institute of Marketing is ‘the management process responsible for identifying, anticipating and satisfying customers needs profitably’. It can also be viewed as adjusting the whole activities of the business to the needs of the customer or potential customer, which means that marketing should become part of a company’s culture where every individual from the person manning the potting machine to the lorry driver is focused and alert to the needs of the customer.
The great news is that there are many businesses in our sector that have created a marketing culture. The number of new plant introductions and the creative use of packaging show there are some great marketing minds out there. Many businesses however still have the wrong orientation. What do I mean by that? It’s about your main focus as a business, of which there are four main types.
- Production focused – Henry Ford was very interested in the way cars were made. In horticultural terms this could mean being primarily focused on how to produce plants.
- Product focused – Being concerned about the attributes and qualities of the product (often irrespective of whether there is a demand or not). For example, adding new plants to your range just because they are rare.
- Selling focused – This is where the primary activities of the company is to sell products – a typical orientation for secondary wholesalers – and there is nothing wrong with that if the final orientation is embraced as well.
- Marketing focused – Meeting the needs of your customer.
It does not mean ignoring or not improving production and the product, but it means we continually find out what the customer needs or wants, produce it and then promote it to them. The process of selling is then very easy because you have what the customer wants. Fail to do this and it becomes very difficult to sell your product or service.
Once a marketing culture has been created in an organisation, managers then need to consider what marketing strategy they will use to grow turnover. Igor Anso, a Russsian-American mathematician, developed a theory outlining four strategic choices available in marketing. They are: –
- Market penetration – This involves increasing market share within existing market segments. In other words you find more of the same types of customers. By the way, this is the easiest strategy to adopt and could get some quick results.
- Product development – This involves developing new products for existing markets. It involves thinking about how new products can meet customer needs more closely, and outperform the products of competitors. So, you might need to think about what additional products or services your target market wants. This will involve a robust financial analysis of current product ranges and their contribution, and may require some creative thinking
- Market development – This strategy entails finding new markets for existing products. Market research and further segmentation of markets help to identify new groups of customers.
- Diversification – This involves moving new products into new markets at the same time. It is the most risky strategy. The more an organisation moves away from what it has done in the past the more uncertainties are created. However, if existing activities are threatened, diversification helps to spread risk.
Whichever strategy you choose to adopt, research will form an integral part of implementing that strategy. Market research can be as simple as regularly talking to your customers (but make sure the outcomes of the conversations are recorded) or more typically it involves the use of structured surveys or questionnaires. Surveys do not have to be expensive – modern communication methods make surveying customers fairly straightforward. However, it is important to ask the right questions in the right way. For example, many garden retailers have invited customers to fill in comment cards in their café – powerful data if it’s used. Outsource questionnaires or survey templates if you need from specialist companies.
Market research doesn’t stop once you have identified a need or a gap in the market. Continue to question your
customers as you develop your products. Let them give you feedback and road test your ideas. We are in an ideal industry to do this as many garden retailers are very happy to work closely with their suppliers on product development. Once you have identified a need you will need to make a variety of choices concerning bringing a product or service to the market – this is often referred to as the Marketing Mix.
Using Four P’s is the common way of defining the marketing mix, and was fi rst defi ned in 1960 by E.J.McCarthy. They are
Contemporary thinking suggests that a further three P’s should be included in the marketing mix, and they are
7. Physical evidence
In essence the Seven P’s can be described as such:
This concerns quality, product sizes or variants, packaging and service levels and also produces something customers need and want which has a perception of value to them. Remember, customers’ needs change and so must your product or service.
Obviously this concerns how much you should charge for the product. Clearly you must make a profit but developing the right pricing strategy at the start is key as this positions you in the market place.
This is about making sure the product or service is available to your customers at the right time and in the right quantities. Which channels will you be servicing – the end user, the garden retailer, the grower? You must also consider other aspects of the supply chain – how will you get it to your customers in a timely and eµ client manner.
The hot potato! How will you communicate to your customers the benefits of your product or service? It can involve the use of personal selling, exhibitions, sponsorship, PR, and direct mail, not forgetting web sites and social media.
This is about you and your sta . You may have developed the most successful product but are your people customer service orientated? Even a good product can fail in the wrong hands.
As above, your processes need to be customer friendly, efficient and accurate.
This is about the image you portray as a company. Does it match the product or service you are offering? For example, if you are appealing to high-end customers do your premises reflect quality and style?
Marketing is an absolutely essential key management process. It can be complex (my favourite tome on marketing, Principles of Marketing is an eye-watering 1,031 pages long) but it isn’t rocket science.
If you start getting closer to your customers and change the culture and focus in your business you will be well on the way to becoming a successful marketeer. But as with all management processes a clear, timed and costed plan needs to be developed with deliverable key performance indicators. If you feel you or your business lacks the skills required, then outsource them as a priority. There is plenty of help and advice available on the web, or practical marketing courses that can teach the essentials. if you have able funds, employing a marketing manager will pay dividends, as will hiring a consultant to assist directly in formulating plans. Get to know what market is out there for your business and make the most of the many opportunities to be discovered by good marketing. It really is the easiest way for a business to grow, survive and succeed.
OVATION BUSINESS CONSULTANTS was established in 1995 by Neville Stein and his wife Caroline. The company provides consultancy and training services to nurseries, garden centres and landscapers across a wide and varied geographical area, including Scotland, Ireland, Poland, New Zealand and China.
Tel: +44 7778 005105