Cranfield School of Management’s Professor Malcolm McDonald has established ten guidelines which you should consider for excellent, profitable marketing.
Marketing is a resource that supports the organisation and helps achieve the overall business strategy. Marketing is NOT promotion. Marketing is NOT sales. However, Marketing is everything an organisation does from research and development to delivery, adapts to and converges on the business value proposition that is projected to the customer.
Marketing IS a process that incorporates the following principles:
Define the market in terms of needs and wants, not products and services. Map how it works from end to end, showing quantitatively product/service flows in total and your shares. Identify the major points where decisions are made in the process and understand how things are changing.
Do not confuse needs-based segmentation with descriptors such as socioeconomics, demographics, geo-demographics and psychographics. Needs form the basis of segmentation simply because the choice of what will be consumed depends on satisfying the decision-makers’ needs at a price they perceive as representing superior value for money, which is rarely the cheapest.
- List what is bought (including applications, where and when it is bought)
- List who buys
- List why they buy
Group the decision-makers with similar needs into segments.
For each segment, list their needs and the relative importance by weight. Score these out of ten based on how well you and each of your competitors meet these needs. To establish your relative competitiveness for each segment, multiply the scores by the weights to determine how you compare with your main competitors.
- List the external opportunities and threats for each segment.
- List the major issues that need to be addressed for each segment.
Establish the factors your organisation would use to determine the attractiveness of each segment such as size, profit potential and growth and the relative importance of these factors to one another by weights. For each segment, score out of ten on how it meets each factor, multiply the score by the weight and thus derive an attractiveness score for each segment.
Position each segment on the vertical axis of a two-by-two matrix according to the weighted attractiveness score, with the lowest scoring segment at the bottom and the highest at the top (this being the “attractiveness“ axis of a portfolio matrix).
From the SWOT analyses from tip number 4 above, plot each segment on the horizontal axis of a two-by-two matrix, with the highest weighted scores to the left of the central line and the lowest weighted scores to the right. This will position each segment as follows: (1) less attractive segments where you have strengths. (2) more attractive segments where you have strengths. (3) more attractive segments where you have few strengths. (4) less attractive segments where you have few strengths.
Download all ten tips, which we hope you find useful.