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Marketing Under Attack

Beware of the pendulum swinging back too fast and too far.It is a well-documented fact that finding a happy medium is rare.As a society, and equally true among the business community, it is nearly impossible to know when we are reacting too far and too fast in an attempt to rectify a wrong or solve a problem.The reaction to the current economic situation is no different, specifically as it relates to how marketing funds are being spent or cut.

The latest uproar over Northern Trust sponsoring last weekend’s golf tournament is a perfect example.Without knowing the facts it is hard to know whether a bank like Northern Trust was prudent or not in allocating a portion of its marketing funds to sponsoring a golf tournament.But like any business institution that hopes to grow it must continually market itself to its target audience, reward it loyal users and producers or it will eventually fail or at a minimum cease to grow which in today’s world is the same thing.

For any business to grow it must understand and allocate resources so as to fulfill the four imperatives for generating sales — generate awareness, trial, repeat and ensure a growing rate of repeat.At the risk of being pedantic, these four imperatives are the keys to volumetric modeling.If consumers are not aware of the product or service then they cannot try it.Once they try it the product or service must be good enough for them to repeat (buy it again).Rate of repeat is a function of usage rates which impacts some products or services more than others.For Crest toothpaste, getting people to brush their teeth more often will increase rate of repeat or for Apple to get people to go to iTunes store more often generates a greater rate of repeat and sales.This all takes marketing.

As we criticize the banks for holding these boondoggles we need to be careful that the pendulum does not swing too far and that “the cable commenters” and “opinionators” (Maureen Dowd) don’t generate a significant downturn in marketing investment.If businesses do not drive trial, awareness, repeat, and rate of repeat we will not grow.My father, who was in sales, was fond of saying that “nothing happens until you sell something”.While a company’s inability to access a line of credit will certainly have a negative impact on their ability to grow and to keep or hire new employees so will diminished marketing.

To suggest that incentive trips and rewarding important clients and their company representatives is a travesty flies in the face of understanding basic human nature. People respond to being treated special, think customer service. And don’t bore me with, oh they are taking taxpayer money.What! Marketing you can see is bad and that you don’t is OK? When we start “legislating” against what salaries people can make and incentives they can take part in we better beware of that pendulum swinging back.Most importantly we better get out of the way because when it hits us we are not going to like the feeling.Personally I think it is insanity to pay a baseball player $150 million but if a baseball franchise thinks that is a good investment that should be their decision.If they are wrong they will probably lose (New York Yankees.)If the bank thinks that sponsoring a PGA event with all of its ancillary festivities is a good investment of their marketing dollars than it should be their decision to do so.

It is not the marketing department that got the economy in this mess so we best beware of making it the fall guy in how the problem gets solved.  Keep your eye out for that pendulum coming back at you..

Comments

Comment from chris
Time June 14, 2010 at 6:01 am

what do you understand by the world marketing under attack

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