In 2012, Twinkie fans taught us an important lesson about marketing: When it comes to company valuation, customer loyalty is king.
Why your marketing isn’t working
Dilbert’s perception of marketing would imply that it’s an industry made of guesswork – throwing darts to see what sticks.
That would explain why many business leaders see marketing as a source of stress and frustration. As with most things in life, we want clear, undisputed answers – a surefire way to hit the bulls-eye every time. What works? What doesn’t? Which marketing tactics produce tangible results, and which are a waste of money? Answering these questions is a tall order, which is why many marketing initiatives don't work.
Therein lies the rub.
The unfortunate reality is this: let’s say you’re able to iron out your company’s unique situation – taking into account your industry, company size, growth stage, competition, and ROI goals – and answer each of these questions with absolute certainty. You know, with unequivocal conviction, that XYZ is the solution to your marketing woes.
You’ll gather the resources, rally your team, and move full steam ahead on a congruent marketing strategy…
…And in all likelihood, a year from now those tactics will be deemed completely ineffective.
Not a guessing game, just a moving target.
There’s a difference between throwing darts to a stationary target, and throwing them at a target on a moving train. The fact is, marketing is dynamic, complex, and in a perpetual state of flux. What produces tremendous ROI one year may very well fall flat the next, and a tactic that initially seemed to have no business relevance may become a primary revenue stream just a few months later.
Sadly, in the small business space, owners often don’t get the memo until it’s much too late – which is why many still think of Facebook as ‘the next big thing’.
Marketing Tactics by Budget Allocation
To demonstrate this phenomenon, take a look at how B2B companies choose to distribute their marketing spend from year to year. Consider the data below from the Marketing Sherpa B2B Benchmark Report, which outlines the difference in marketing budget allocation for B2B companies from 2010 – 2011:
Take SEO, for example. In 2010, Search Engine Optimization (SEO) seemed like a sound marketing investment for B2B companies – ranking a respectable # 4 in investment percentage. It would be safe to assume, in 2010, that SEO was an effective and desirable marketing tactic.
One short year later, however, interest in SEO dropped. Search Engine Optimization claimed only 9% of budget allocation – less than half of its front-running competitors – and dollars were otherwise deployed toward paid search, tradeshows, and print advertising.
Marketing tactics by effectiveness
As you might expect, when asked about their perceived effectiveness of each of these tactics in the same survey, B2B companies reported SEO as being 7% less of an effective tactic in 2011 than in 2010.
Business leaders had similar sentiments toward virtual events and webinars: In 2010, a whopping 43% of B2B companies reported virtual events and webinars to be a “very effective” marketing tactic …whereas the very next year, less than half (19%) of those same companies reported feeling the same.
In other words, what produced results 12 months before was now being tossed aside as irrelevant.
The lesson? Trends in marketing – as in life – are perpetually evolving. New technologies are sprouting up daily, and marketing tactics are only as relevant as the customers who flock to them.
The problem with existing marketing models
Unfortunately, when tackling marketing, many companies are still operating under the assumption that – like accounting, HR, and many other business functions – marketing must be a static entity. This leads to misguided marketing approaches, including:
The In-House Marketer
In-house marketers are often the unsung heroes of an organization – wearing too many hats, stretched too thin, and typically relegated to administrative tasks and sales support. There are many reasons for the ineffectiveness of hiring a person to fill your marketing need – namely, it severely inhibits the company’s ability to think at a higher strategic level.
Because of this ‘task-master’ function, the in-house marketer rarely has the time (or ability) to pick their head up to see how the marketing landscape is changing. With no immediately discernable reason to adjust tactics, he/she will default to what they know or what they’ve done before – letting effective strategies grow stale, and often perpetuating bad habits.
The Tactical Solution
Another common approach is to hire a marketing firm with an area of tactical expertise (in other words, “one trick ponies.” Examples include:
- Website Design Firm
- Search Engine Optimization Company
- Branding Agencies
Companies like this are great for larger corporations – with a sophisticated marketing infrastructure, and the ability to hone in on a singular tactical need. Tactical agencies are also a reasonable solution for startups; with limited capital, these businesses can only afford taking on small projects one at a time. For growing businesses, however, the tactical approach is less than ideal. Small businesses often have a variety of diverse marketing needs, and a specialized firm will only solve one symptom of an often larger marketing problem.
Rather than utilizing a firm specializing in a tactic, look for marketing expertise in your industry. For example, if you’re in retail, hire a marketing firm with a track record of working with retailers; if you are a B2B service provider, look for a company with deep expertise in this arena. Whatever your specific offering, partner with a firm who knows how to market a company exactly like yours. This kind of deliberate focus provides a much more relevant expertise than specialized marketing tactics.
The Predatory Company
The fact is, if you’re a small to medium-sized business (or SMB), you’re part of a massive market. At last count, small businesses represent 46% of gross domestic product – making them a very attractive target for certain kinds of marketing service companies. However, it's tough to turn SMBs into profit unless there's a high number of transactions (think Wal-Mart here: its success is driven by high numbers, thin margins, and low quality). Most offerings for SMBs, sadly, are structured around the "one size fits none" ideology.
Take heed, there are actually dangers of partnering with these types of predatory businesses. And not metaphorical “dangers” like ugly design – actual monsters under the bed, and less-than-ethical business practices.
Unfortunately, business owners are often taken advantage of by companies like this, seduced by “guarantees” of immediate results. But if something sounds too good to be true, it usually is. Here are just a few examples of unhappy customers who learned this lesson the hard way:
Consequences of misguided marketing solutions
These ineffective marketing models don’t just waste your company’s time and money – they can actually affect your brand integrity. What’s worse, your business will see underwhelming marketing results in a gradual, non-dramatic way – a slow, steady decline easily blamed on other factors.
With the landscape constantly changing, and both internal and external options bringing obvious drawbacks, how can companies make sure they’re staying ahead of the marketing curve?
The answer is simple (but far from easy): The only way to hit a moving target is to travel at the same pace. Good marketers must have their finger on the pulse each and every day.
So the next time you’re wondering why your marketing isn’t up to speed, ask yourself – am I on the train? Or am I standing on the tracks watching it go by?