A recent business consultancy drew my attention back to the immediacy of customer relationship management’s (CRM) need to relate to advertising and behaviour within the distribution network.
In the cruel world of retailing, one advertises with a view to bringing customers through the door as soon as possible so that they may be exposed to opportunities to buy. Predictability of customer behaviour in response to advertising is a highly moot point.
However, we can gather some clues on the potential accuracy of forecasts of consumer demand from studies done by authorities like Ray Kordupleski in his seminal work Mastering Customer Value Management: The Art and Science of Creating Competitive Advantage (www.cvminc.com).
Clever marketers focus their messages on attributes of their entire business that drive the brand. What is it, they ask, that drives customers’ perceptions of the value advantage we offer over our competition? It may not always be the product. It may not always be the price. It might be the shopping experience or transparency of the billing process.
This is where things start to come unstuck – most people do not appear to know why anyone does business with them! And they are rarely prepared to either admit that fact, or do anything about finding out.
Sure, they do all the obligatory customer satisfaction surveys and carry on a treat about what a great “people” business they are. But, it is a rare thing indeed to see credible reflections of customers’ views on the value advantage over competitive choices a business offers in its advertising.
As always, it all comes down to the brief and the professionalism of input. If we wish to take command of the process of accurately forecasting demand for our products or services, we would be wise to pay much closer attention to learning precisely what it is about ourselves and our competitors that customers perceive as offering them genuine value. Then concentrate on communicating our advantages.
If this all sounds a little ho-hum, then just try asking half-a-dozen of your fellow executives for proof that they know why people do business with your company. It’s a sure bet they will guess but won’t know. Neither will the poor sods who make your ads come up with one reason why FTA TV and commercial radio’s share of the advertiser wallet is in permanent decline. Nor will any of the media reps responsible for your business because too few of the youngsters on starvation wages planning your media strategy don’t know either.
Maybe this is all good news for the researchers or the Kordupleskis of our world. Maybe it’s more bad news to the poor sods like Eddie Everywhere who must be wondering where all that lovely ad budget money went and when it might come back.
Let me tell you Eddie: not any time soon, because you are not dealing with people who know why customers do business with them, and you and your people don’t know either.
To paraphrase a legendary quote from the President of Harvard: If you think education (substitute research into customers’ relative weights of importance on key purchase criteria for you and major competitors) is expensive, try ignorance!
Bob Miller is principal of Australia Street Consulting.
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