I recently posted to LinkedIn the Accenture Technology Vision 2015 Report, which focused on what firms can do with their digital skills for competitive advantage. The Report is worth a read, and there are some ideas there that I think I will explore further in future posts, particularly in terms of the Outcome Economy. But while firms do need to get a grip on their digital opportunities, there is also another looming problem on the horizon for enterprises, and it relates to marketing strategy.
"Marketing strategy is the fundamental goal of increasing sales and achieving a sustainable competitive advantage"
Source: Michael Baker, The Strategic Marketing Plan Audit, 2008
While the fundamentals of marketing strategy hold fast in an age of digital connectivity, there is a shift in accessibility and reach of companies, products and marketing messages. The coming risk to marketing strategy for business is in misunderstanding the scope of the competitive landscape.
Traditionally, marketing strategy has focused on the competitive environment for a company in terms of geographical boundaries, demographic and ethnographic profiles, and product categories. But increasingly the boundaries between these classifications are breaking down. Geographical boundaries may still apply in the real world, but from a sales perspective, they no longer matter so much. As distribution systems evolve to manage international purchasing and shipping, sales internationalization has become the norm. Similarly, demographic and ethnographic categories are breaking down for goods and services, as buyer behaviour breaks free from some of the previously expected behaviours of age and social status groups. Even the boundaries between product categories are blurring. You may be selling a fast-moving consumer product like a soft drink, or a luxury good like a car, but wrapped around those products are a range of other value-added services - mobile payment systems, mobile community apps, insurance services, analytics systems, and so on. If you’re a high growth brand name, it’s unlikely that you just make the goods you’re known for. You probably have a whole ecosystem of products in the marketplace.
So if marketers are still talking about strategy based on these old categories, they are likely to be missing whole segments of the market where other competitors may be playing. And it’s that myopic attitude to strategy where companies can miss the rise of new entrants to the marketplace.
Of course this doesn’t mean that you should just have one global marketing strategy for every brand. You still need to think about the different value systems that apply to regional and social groupings, and you need to prepare marketing campaigns that reflect digital device adoption, consumer engagement models, and changes to education, health and welfare as they vary from market to market. But what matters is when you are implementing a marketing strategy, you need to think about more than what is the next cool idea for YouTube, or what is the next viral campaign. You need to think about the reach and social impact of your campaigns, and you need to consider how your extended product catalogue will be received in various markets. And tough as it sounds, there needs to be some work done on surveying the competitive landscape from a global rather than a local perspective, and you need to be able to identify how emergent competitors are positioning themselves in different spaces, and for different targets.
The right sort of marketing strategy will be one where even small and new players are considered as competitors, because they may well be disrupting consumer behaviour. These players should be assessed on:
- how easy it is to adopt their product compared with your branded products
- how well their messages resonate with emerging consumer behaviours
- how flexible their messaging is for global markets
- how innovative their product appears in comparison.
Once this assessment is conducted, companies can more easily determine the threat posed by new entrants in the market, and prepare a marketing strategy that can take on, and even learn from, the market disruptors.
Marketing strategy now requires a much more global perspective. If firms don’t look beyond their own backyards, they risk missing new players who may rise to eclipse them before they even realise they are under attack.
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