Why is Marketing Such a Mystery?
An even bigger mystery is why so many businesses simply pay lip service to the concept of marketing. Probably because the what, why, how, when and where of “doing marketing” is so poorly understood, or perhaps it’s more accurate to say – misunderstood!
Peter Drucker, one of the best-known and most widely influential thinkers and writers on the subject of management theory and practice perhaps had the nub of the issue when he stated:
“The purpose of business is to create and keep customers”
Business has only two functions – marketing and innovation
Why did he say there were only two functions?
Because marketing and innovation produce results;
all the rest are merely costs!
These are two powerful statements, and can be summarised as:
- If you can’t acquire and keep customers, you don’t have a business.
- It took innovation on behalf of the business owner to actually start a business and keep it thriving
- But innovation by itself is not enough, you also need marketing to succeed.
So have you got a handle of what marketing is?
Most business owners know intuitively that it means attracting prospects, getting those prospects to purchase their products and services to then become customers, and then of course you have met the purpose of your business.
How many ways do you know to attract prospects?
A better question is how many ways do you actually implement to attract prospects? and:
- Do they work?
- Is it the best way to attract prospects?
- How many prospects did you attract last week or last month?
- An even more important, do you know how many it will attract next week or next month?
Probably even more telling is how did you get your knowledge on marketing?
- Did you read about it?
- Is that what your competition does?
- Where you pressured into it?
- Did you do it because it’s what everyone else does?
Let’s get back to Peter Drucker’s purpose of a business – create and keep customers.
It’s obvious that this is the starting point, but to make more money and be more profitable there has to be a more comprehensive description on the purpose of business.
So let’s outline that:
- For a start, we have the term “Lead Generation”, that is all the strategies, tactics and resources needed to acquire lots of prospects interested in your products and services.
- Then we have the term “Lead Conversion” which is all the strategies, tactics and resources needed to get your prospects to buy from you and become your customers.
- That’s not enough, as the next step is to increase the average number of transactions with each sale. Whether you up-sell, down-sell, cross-sell or whatever strategy you use, you will make more if your customers purchase more than one thing for each sale.
- That’s still not enough; you need strategies to raise your prices for each transaction. Sure you may loose some customers initially, but the facts show that price only matters in the mind of the customer as to the perception of value they obtain. Price is not what you think it should be, or what the competition set their prices at, it’s what the customer values.
- So far so good, but there is more that you need to understand about marketing. You also need to know the strategies, tactics and resources needed to increase your profits without loosing customers.
Once you understand and have implemented you marketing to this level, the next level is to build your business into a million dollar business, and that is another level up in your marketing.
Nothing so far is new, you knew all this when you set your business up, but I bet you sacrificed many of these marketing ideas to get customers, to undercut your competitors and to survive on a daily basis to pay your overheads and keep your business afloat.