In marketing, some of the hardest decisions relate to how to best allocate resources across the marketing mix, which are all possible ways of reaching and serving potential and existing customers.
Should you spend less on brand building and more on new product marketing? More on customer service improvements and less on sales promotions? Or even significantly reduce all of these activities in favour of more social media or interactive media investment?
The challenge is finding the optimal mix that suits your business best to deliver the biggest impact. The formula for the marketing mix is elusive as each business has different priorities to achieve success. It’s a huge frustration for business owners, senior management and marketers alike.
Top management’s demand for greater accountability for marketing expenditures seems to only grow. The pressure to perform has never been greater with the threat of diminishing returns and failures to launch new products. Many business and consumer brands are losing their luster as customer demand shifts and changes, making these brands less relevant.
What’s critical to any marketing strategy is ensuring that it is always properly targeted to the appropriate audience for your products and services. By fully understanding your brand’s position and clearly articulating it to the market through problem-solving differentiators, you are improving the likelihood of developing a successful marketing mix.
Marketing accountability is difficult to achieve because the cause-and-effect relationships between marketing and business performance usually are fuzzy at best and vary so much by industry. In some cases, a direct link can be established, while in others, it is more subjective and open to interpretation.
Tactical insights are what companies want. However, the ultimate marketing performance measure always seems to boil down to lessons learned in improving profits in the near term. For businesses that depend on building long-lasting, profitable relationships with customers, this type of modelling always falls short.
We want you to challenge yourself to clearly articulate your target market along with your long term sales goals. Our experience shows that balancing both increases your chances of not only setting realistic goals, but creating a marketing mix that truly supports the delivery of these goals. Companies will reach a point of diminishing returns sooner if they haven’t settled on the right marketing mix. Don’t fall in the trap of choosing a marketing tactic that boosts sales in the short term. It can have a harmful effect on customer lifetime value.