The Challenge Of Creating Compelling and Competitive Value Propositions

What comes first the chicken or the egg? What comes first the communications campaign or designing and delivering an appealling value offer that matches or exceeds the expectations of customers not what we ‘think’ they want.

A Marketing Communications strategy is not a Marketing Strategy. Crafting a Competitive Strategy a.k.a Marketing Strategy is fundamental to the success of any enterprise. It is, at its heart a strategic management process concerned with creating and delivering products and services that people want to use and buy.

As we know there are various levels of understanding about what the term ‘marketing’  means. A significant number of people exclusively and erroneously equate ‘marketing’ with advertising and promotions. A significant number of people understand otherwise. It’s purpose is to deliver competitive advantage.

There are various posts and comments on this blog which give a flavour of the ways in which the term ‘marketing’ is understood and how it should be deployed. Alexander Repiev (on this blog) uses the metaphor of the Augean Stables to discuss the amount of ‘marketing manure’ that has built over the years in the marketing profession. Regretably even some seasoned marketeers sincerely believe that the role of marketing is primarily one of marketing communications and thereby reinforce the misconception. This is sometimes given extra gravitas and importance by describing it as Branding. Jean Noel Kapferer amongst others explain Strategic Brand Management otherwise. Much to the chagrin of many marketing professionals they are sometimes ‘cast’ in that role by people who think the marketing job is to merely sell what the enterprise has on its shelves, or hopefully transform worn out products with a new wrapper.  This is invariably a forlorn hope. President Obama described activity such as this in more candid terms recently.

One of the snake pits of the ‘marketing is communications’ approach is that it invariably puts the cart before the horse. It predisposes management to hyperbole and self agrandisement. It fools people into believing that if you say it loud and often enough it is the truth.  Experience has taught many businesses the hard way that if you approach competitive strategy from that perspective its has its costs. A more effective approach in this sequence.  (see Kotler et al):

1. Define the value based on deep customer insight to create key benefit segments. Not all customers are alike. Don’t rely on guess work, high hopes, conventional wisdom, personal assumption or preference. What if Bill Oddie look alikes  and wellingtons symbolise a  significant high value customer segment? Do you disparage them because they don’t fit with a personal idea of the ‘ideal customer’?  Clearly and objectively gather evidence to answer the questions ‘why should anyone  buy from us?’, ‘what benefits do they tell us they are seeking?’, ‘what differences make a difference to our target customers?’

2. Produce and deliver the value. Not all customers are alike. Do the good stuff that transforms customer experience of products and services. Segment the offers. Provide the value that people seek not what you think the value should be.  Create a solid evidence based platform from which to shout from.

3. Finally communicate the value. Not all customers are alike. Talk about proven benefits in terms that are meaningful to the customer not in language that we ‘think’ is meaningful or could be meaningful if only the right meaning is used. The meaning of communication is the way it is received. Different segments want to hear different things said in different ways about the benefits they seek.

Communications preferences in a commercial context should never be judged by whether someone likes or dislikes them on entirely subjective grounds. Talking about strapline preferences ‘as if’ they are merely the stuff of subjective opinion tivialises their true purpose. It’s not about whether somebody ‘likes’ or ‘dislikes’ a strapline its about whether the strapline is effective in purpose.   Marketing Communications has a purpose. It also goes much further than ‘salience’ or capturing peoples attention through shock or controversy.  I prefer to judge a communciations campaign on the commercial effectiveness of its  social influence.

Marketing Communciations is what it ‘is’ and Social Influence is what it ‘does’.  Any communcications endevour can therefore be measured in terms of how effectively it changes attitudes and consequently behaviours. There is however no guarantee that a change of attitude will translate into a change of behaviour (see criticisms of the Hovland Yale model and AIDA).   It can’t ever be described as money well spent simply because the advertising ‘stands out’, or the thing advertised has become more ‘top of the mind’, it can’t ever be decribed as good value for money just because people have worked hard on it and created alot of ‘stuff’ that people can use.  However commendable the effort, this misses the point.

It should also be remembered that changing a behaviour can change an attitude without the expense of marketing communications collateral. A positive experience is often more powerful than any ‘top down’ marketing communications claims.

If you communicate what you believe to be the value before you’ve provided it, you preach before you practice, you have no evidence that you have matched customer expectations. It is nothing more than a well intentioned aspiration. Actions speak louder than words.

There is a crucial philosophical and theoretical point here and as Kurt Lewin said “there’s nothing so practical as a good theory”. Our theoretical understanding of marketing determines how we do it in practice.

So let’s imagine we are deeply involved and experienced in a particular business sector. This business is facing some competitive challenges. We know that our competition has increased over the years  and there are more appealling choices for our once loyal customers. We also know that the experience we have delivered has been below par in some instances. We also know we have good things to sell too and we can’t rely on other people to do this for us. We know that if we stand idly by then our business is likely to dissapear. What do we do about that?

A good place to start is point 1 above. It seems self evident that we should provide ‘quality’ but and here’s the rub… What does ‘quality’ really mean? Whose ‘quality’ are we talking about? We can only establish the ‘quality’ that should be delivered by understanding the needs and expectations of the diversity of customer segments. What does ‘quality’ mean to them? What are the critical choice factors that customers, present, lapsed and new say they want. Do we have evidence directly from them.  Is there any correlation between what we think is of value and what they think is of value? Getting this right is marketing.

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