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“Marketing is not the art of finding clever ways to dispose of what you make. Marketing is the art of creating genuine customer VALUE. It is the art of helping your customers become better off. The ...

“Marketing is not the art of finding clever ways to dispose of what you make. Marketing is the art of creating genuine customer VALUE. It is the art of helping your customers become better off. The marketer’s watchwords are quality, service, and VALUE”.
By Author: Philip Kotler

How to Market "Value" by Andre' Harrell

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Marketing "VALUE" Presentation! Marketing "VALUE" Presentation! Presentation Transcript

  • MARKETING “VALUE” Sales & Marketing (Centers of Excellence) Presented By Andre’ Harrell
  • “Marketing is not the art of finding clever ways to dispose of what you make. Marketing is the art of creating genuine customer VALUE. It is the art of helping your customers become better off. The marketer’s watchwords are quality, service, and VALUE”. MARKETING “VALUE” Author: Philip Kotler
  • “Marketing is much too important to leave to the marketing department….In a truly great marketing organization, you can’t tell who’s in the marketing department. Everyone in the organization has to make decisions based on the impact and VALUE to the customer”. MARKETING “VALUE” Late Author: David Packard Hewlett-Packard
  • I. Sales & Marketing 1) Customer Satisfaction 2) Building Customer Database 3) Differences of Opinion 4) Customer Merchandising Design 5) Market Disruption 6) Market Disruption/Differentiation II. Creating Customer Value 1) Features & Benefits 2) “Framing” 3) “Commitment Drivers” 4) Application Questions III. Building A Winning “VP” 1) 4-Prong Strategy 2) Value Proposition 7-Step IV. Critical Success Factors MARKETING “VALUE” AGENDA
  • Unfortunately many companies today do not pay enough attention to true customer VALUE....instead there’s more focus on market share/profits which suffer because of poor customer service. Companies need to monitor and improve the level of customer satisfaction. The higher the customer satisfaction, the higher the retention. Four concepts to remember: 1. Obtaining new customers can cost up to 10 times more that the costs involved in satisfying and retaining current customers. 2. The average corporation loses close to 30% percent of it’s customers each year. 3. A 5% reduction in the customer defection rate can increase profits up to 85%, depending on the industry. 4. The customer profit rate tends to increase over the life of the retained customer. MARKETING “VALUE” CUSTOMER SATISFACTION
  • In building the customer database, you have to decide on what is the information you want. 1. The most important information to capture is the activity/and or transaction history of each buyer. Obviously, knowing what they’ve purchased may give you a clue what they may purchase in the future. 2. Of course, completing a “Customer Segmentation” process that can capture demographics (e.g. age, education, income, family size, and other attributes. Companies like Facebook, Google have cornered the market on gathering this type of intelligence. 3. A somewhat invasive research method is what’s called “Psychographic Information” which captures customer activities, interests, and opinions. “Customer Insights” intelligence. MARKETING “VALUE” BUILDING CUSTOMER DATABASE
  • What Customers Want • We want companies not to have extensive personal information about us • We would be willing to tell some companies what we might like to be informed about. • We would want companies to reach us only with relevant messages and social media at proper times. • We would want to be to reach companies easily by phone or e- mail…and get a quick response. MARKETING “VALUE” What Companies Want • We want to know many things about each customer and prospect. • We would like to tempt them with offers, including those that they might not have awareness of or initial interest in. • We would like to reach them in the most cost-effective way regardless of their social media preferences. • We’re looking for the least costly way of having consistent contact with them. DIFFERENCES OF OPINION
  • Design is a BIG IDEA, covering product design, service design, graphic design, packaging design, and environmental design. Too few product managers know what design is or VALUE it. Overall product design is a larger idea than how a product looks. A well- designed product, in addition to being attractive, would meet the following criteria: • Easy to open the packaging. • Easy to assemble • Easy to learn how to use • Easy to use • Easy to repair • Easy to dispose Customers like “EASY”….as Staples points out! MARKETING “VALUE” CUSTOMER MERCHANDISING DESIGN
  • MARKETING “VALUE” MARKET DISRUPTION When we refer to a specific market as a “Commodity Market” what we’re saying is we don’t see any differentiation between products and typically customers don’t care which brand they choose. On the other hand you can have a market where there’s considerable satisfaction with one or two brands, customers have built a specific relationship with a certain brand. Ways to “Disrupt” either scenario: 1. The most important information to capture is the activity/and or transaction history of each buyer. Obviously, knowing what they’ve purchased may give you a clue what they may purchase in the future. 2. Of course, completing a “Customer Segmentation” process that can capture demographics (e.g. age, education, income, family size, and other attributes. Companies like Facebook, Google have cornered the market on gathering this type of intelligence. 3. A somewhat invasive research method is what’s called “Psychographic Information” which captures customer activities, interests, and opinions. “Customer Insights” intelligence.
  • MARKETING “VALUE” MARKET DISRUPTION/DIFFERENTIATION “Market Disruption/Differentiation doesn’t have to be significant. For example commodity products like washing detergents are not distinct from one another with maybe a couple of nuisances. A product may add a different fragrance or texture and when “Packaged Well” could be perceived as a disruptive/differentiating product…but not offer anything more than that. Ways to “Differentiate: • Product: (features/benefits, performance, pricing, durability/warranty, reliability, style, design etc). • Customer Service: ( delivery, behavior, empathy, helpful, customer competency, timely, politeness, service) • Personnel: (competence, courtesy, credibility, reliability, responsiveness, communication skills). • Image: (packaging, style, creativity, reputation, well branded, simple)
  • MARKETING “VALUE” “Creating Customer Value” (Centers of Excellence)
  • MARKETING “VALUE” FEATURES & BENEFITS A basic concept in marketing & selling is the importance of getting clear in the customers’ mind the distinction of a products’ feature & benefit from the competitor. Customers typically aren’t interested ONLY in the features of a product; they are interested in the benefits to them (this is the “VALUE” component). Said differently, features tell and benefits market/sell. It has been said that people don’t go to the hardware store to buy a drill bit; they go to buy a hole in a board. People don’t go to the store to buy laundry detergent; they go to buy clean clothes. They are interested in how something benefits them, not the features of your product or service.
  • MARKETING “VALUE” “FRAMING” An artist examines a landscape and decides which elements he/she wishes to include or exclude for the painting. Like the artist, “Marketers” can selectively choose what they would like to emphasize during the “Framing” of a product. Framing: the skill of analyzing the situation, and constructing the most favorable context or frame of reference for influencing the customer to achieve the objective: • You use Framing to shape the value of the various items at your disposal such as an Iphone or Ipad. • The most powerful “Frames” create a context that allows a “Marketer” to achieve their objective by coupling their agenda to the needs and interests of the customer. The Framing skill creates optimal value for your products and “value-adds.” Here’s how it’s done: 1. Know what’s important to the customer 2. List all the characteristics of the product “value-add” that might appeal to the customer 3. Share only the best combination of these two.
  • MARKETING “VALUE” “FRAMING” KEY LESSONS • “VALUE is a creation and you are the creator. • “VALUE” is in the mind of the customer. • There are many ways to describe the things we offer a customer. Some create perceived “VALUE” better than others. A “Marketers” job is to find the best approach for each customer engagement. • By “Framing” the “VALUE” of your products more effectively, you may be able to get the customer to make commitments which move him/her to your goal of increasing product/service use.
  • MARKETING “VALUE” “COMMITMENT DRIVERS” Most people cannot handle the virtual flood of information coming at them and unconsciously screen information. Social science research indicates that when people don’t have enough time or data to make decisions in their usual fashion, they take predictable “shortcuts.” Customers use these shortcuts in their decision-making process in order to maintain their hectic schedules. Commitment Drivers are ways to use these shortcuts to help you take advantage of the customers’ natural thought process. There are six Commitment Drivers: 1. Scarcity— 2. Deadline— 3. Authority— 4. Conformity—5. Bargain—6. Competition
  • MARKETING “VALUE” “COMMITMENT DRIVERS” DEFINITIONS COMMITMENT DRIVER DEFINITION EXAMPLE Scarcity When something is perceived as rare or in short supply, the customer will be more motivated to take action to get it. “These cars are going quickly. I only have one left and the backorder is long.” Deadline If the customer feels that a valuable opportunity will shortly be unavailable, they will be more motivated to act now to acquire it. “I have to finalize the order by tonight before closing at which the offer will close. Should I put you in for an order?” Authority When a credible expert addresses a course of action, the customer will feel that taking action is less risky. “Dr. Oz, said that this product yields better results for his patients than anything else he has tried.” Conformity Sometimes closure can be accelerated by pointing out that, "Everyone is doing it.” “Other large notable retailers have been using _____ with great results.” Bargain Many people take action(when they otherwise might not), simply because “it was too good a deal to pass up.” “I will do a demo with your staff over lunch, so it will not take away from your busy time. Competition Injecting an element of competition can often accelerate closure…especially if this is coupled with scarcity. “I only have five samples left and I know customers that would like to have them. How many samples do you need?”
  • MARKETING “VALUE” “APPLICATION QUESTIONS” • Based on what I know about this customer, which of the Commitment Drivers might work best? • How can I use “Framing” to create a sense of competition, scarcity, or bargain around my “VALUE”-add? • What ways might I create a sense of urgency in the mind of this customer? • How might I appeal to a respected authority or create a sense that “everyone is doing it” to motivate commitment? • How might I combine two or more Commitment Drivers to create even more motivation for a customer to take action?
  • MARKETING “VALUE” “APPLICATION QUESTIONS” • Based on what I know about this customer, which of the Commitment Drivers might work best? • How can I use “Framing” to create a sense of competition, scarcity, or bargain around my “VALUE”-add? • What ways might I create a sense of urgency in the mind of this customer? • How might I appeal to a respected authority or create a sense that “everyone is doing it” to motivate commitment? • How might I combine two or more Commitment Drivers to create even more motivation for a customer to take action?
  • MARKETING “VALUE” Building a winning “VALUE PROPOSITION” (Centers of Excellence)
  • MARKETING “VALUE” “4-PRONG STRATEGY TO BUILDING A VP” Optimize Communication of Value Proposition Generate Broad Product Demand Set up protocols/processes that offer the best opportunity for product brand to succeed Gain customer acceptance with compelling solutions in a wide variety of venues through targeting and segmentation Convince targeted customers to use/champion product brand Disrupt Perceived Market Satisfaction Drive awareness of limitations of current products and position your product as an innovative solution Ensure Positive Product Experience
  • MARKETING “VALUE” “VALUE PROPOSITION 7-STEP” 1. Start with PRODUCT core competencies 2. Know your customers 3. Competencies = Character 4. Research the competition 5. Look at trends in your industry 6. Articulate Effectively Product Vision 7. Validate the “VALUE”
  • Start with core competencies •What are you really good at? •A value proposition has to be what you do and who you are. It can’t just be what you want to be and what you say you are. Make a list of the following: what you brought to market first, what you offer as the only provider to the market, and what makes your offering clearly superior to any alternative. You are looking for what makes your product unique. These are good differentiators and will help the process. To Do 1
  • Know your customers • Who are your top customers? • What problems do you solve for them? • What problems do they want solved? (That no one else can fix) • Is there a new trend in any of your key customer segments? 2
  • Competencies = Character •Ask yourself why someone should buy from you instead of a competitor. •Using the language of your customers, refine your core competencies as values. •If your answer is “it works”, “it’s new” or “it’s less expensive” your potential success may be limited. These qualities do not make a product unique. 3
  • Research the Competition •Choose 3 or 4 competitors and study how they market their company and products •What is their value proposition? •Can they defend it? •Map their core competencies versus yours 4
  • Market Trends • Are things changing? • Can you take advantage of a trend and grab an exciting position in the market? – “Quality of Life” – “Cognitive Mobility” – “Excellent Safety Profile” – “Cost Benefit” 5
  • Articulate Effectively Product Vision • Product Leadership – Unique product profile – State-of-the-art features/benefits – Innovative solutions • Customer Relationship – Quality relationships with customers – Offer “complete” solutions  Refine your value proposition until you can articulate it in one sentence. 6
  • Validate the “VALUE” • Test the final value proposition with customers to see whether it resonates. – Key Opinion Focus Groups – Customer Surveys – Trade Associations – Specialty Advisory Boards – Market Research/”Customer Insights” – Conventions-White Paper Discussion – Regulatory/Legal 7
  • MARKETING “VALUE” Create and widely communicate a differentiable value proposition that’s built on: Innovation (“Versatility”) • Rejuvenates anticipation and excitement Launch “Company A” • Create partnerships/relationships (PR Branding) Create Business “Competency Structure”
  • MARKETING “VALUE” “CRITICAL SUCCESS FACTORS” •Establish stronger company presence with KEY STAKEHOLDERS •Develop and implement Marketing Mix to strategically target key CUSTOMER SEGMENTS •Gain awareness and acceptance of your product’s value proposition •Insure positive product usage and EXPERIENCE
  • “THANK YOU”
  • Andre’ Harrell AH2 & Beyond Consulting www.ah2andbeyond.com 267-221-8529