We are an innovation-based industry dependent upon a never-ending stream of new and better technologies that are absolutely necessary if we are to continue to grow.
Were this the cereal industry it would be acceptable to sell the same cornflakes our parents and grandparents sold. But we’re not. We must innovate more than any other industry I can think of. And while we typically do, there is more to succeeding than simply inventing new products.
When I stop and look at the big picture — how much merchandise and knowledge we have vs. what consumers believe we have — I conclude that things are out of whack, that our efficiency ratio of “what consumers know” divided by “what we have to explain” is quite low. If we could quantify it, I am sure we would find that we have 10 times, maybe 100 times, more to offer than the consumer knows we have.
But maximizing that takes money. Some years ago I did an audit project for a client in which we discovered that Proctor & Gamble, just one company, spent more advertising on all of their products than did the entire CE industry. With due respect to P&G, I assumed then and certainly now that the CE industry has more to say about what we sell than P&G did about their soaps and such. Nonetheless, that is reality and we would simply have to find other ways to get our message through to consumers — ways that absolutely require retailer participation.
I have a client whose marketing judgment is, in my opinion, one of the best in the CE industry. He recently confided to me his frustration with his company’s lack of consistent communication from marketing through their sales force to retailers. He knew for a fact that the detail of what they were doing was not consistently being passed along to their retailers by their sales people, and as a result much of the benefit from marketing was lost.
Could he have effectively used more marketing money? Certainly, but his greater concern was that everyone wasn’t on board with what was already being done, resulting in lost sales.
He’s right. There is a gaping hole in the CE industry’s “knowledge pipe,” a conduit from those who invent CE technology to the consumers who are expected to buy it and use it. Let me suggest the following steps that should be taken by every CE manufacturer to help close that gap:
- Determine what you need consumers to know about what you want to sell them. And don’t take this lightly; there is much to teach them before they will buy.
- Decide how you will get that message to them. Part of it will go through traditional marketing but the bulk of it will need to happen at the point of sale.
- Recognize the role retailers will play communicating your message to consumers and actively engage them in the process. You simply cannot do it without them.
- Refine the message based on real world experience. Going with your assumptions on what needs to be said is only that, assumptions.
- Think about why someone should buy your product, and of greater importance, how best to get that message to them. That’s the ABCs of marketing.
- Time For Change: A Management Manifesto - January 6, 2011
- Brand Value Can Be More Critical Than Price In Closing The Sale - June 22, 2010
- Marketing Matters: Retailers Respond To The Call For A New Independent - March 23, 2010