How to Stop Customers from Fixating on Price by Ajay K. Sirsi * [40]

 

In business-to-business settings, I often hear managers making unsubstantiated statements such as: 

  "We are too expensive"

·          " Our customers are so price sensitive"

              "All that our customers care about is the price”

             " We are pricing ourselves out of the market”

·          " Lower-priced competitors are taking business away from us”

These “truths” are often spoken in tones bordering on hysteria and hopelessness.  In this article, I will show you that these statements are not only false; rather, these myths take on a life of their own and become part of the organizational narrative, sapping business prosperity. 

I was at a shopping mall on the weekend and noticed something interesting.  All the high-end stores (read: expensive) had velvet ropes at the entrance, stopping customers from entering.  A hostess stood by the door, putting shoppers' names on a waiting list to enter the store.  I overheard one of them say to a shopper that the wait was 45 minutes.  At each of these high-end stores, the lines of consumers snaked around the corner, with shoppers waiting patiently to get in.

None of the middle-of-the-road brands (read: inexpensive) had such an arrangement.  Nor did they have any line of consumers waiting to get in.

The data show that consumers are spending money on high-end brands.  I asked myself what these expensive brands do to make consumers not care about price?  The truth is that these consumers are price insensitive because they receive benefits in exchange for the price they have paid.  These benefits are tangible (quality product) and intangible (prestige and status).  The high-end brands have done an excellent job of creating and communicating these benefits to their target customers.

Why can we not do the same thing in business-to-business markets?   

First, let me destroy a firmly entrenched misconception.  While it is popular to proclaim that all that customers care about is price, the research does not support this claim.  The research reveals that in B2B markets, price is never the most critical factor.  While price is not unimportant, customers prioritize other factors such as quality, delivery, reliability, after-sales service and support, and trusted partnerships.

Therefore, if a customer is fixated on price, it should tell you that you have done a poor job of creating and communicating the value of your offering.  Either your offering does not have the benefits desired by the customer, or you have done a poor job of communicating the value you are providing.  Let me add details to both points.

Creating Customer Value

In business-to-business situations, it is easier than in B2C markets to develop benefits for the customer.  In B2C purchases, some benefits consumers seek might be pretty nebulous.  These might include notions of status, prestige, and one-upmanship – factors that typically are not considered by B2B professionals (I have seen instances where these intangible factors are dominant even in B2B markets, but I will save that for a future article). 

Creating customer benefits is more straightforward in B2B markets because, in this space, customers only care about two things: reducing their costs and increasing their revenue.  Nothing else matters to them.  Every customer need and pain point falls into one or both categories.  Please review the table below to get a sense of the point I am making here.

	Impacts Customer’s Cost	Impacts Customer’s Revenue
Purchase price	X
Availability of spare parts	X	X
Shortage of labor		X
Retaining employees	X	X
Operational efficiency	X
After-sales support	X	X
Supply chain issues		X
Building a brand		X
Getting more customers		X

I think you get the point I am making here. TBO, not TCO

To create value for the B2B customer, go beyond conducting a Total Cost of Ownership (TCO) analysis.  Instead, perform a Total Benefit of Ownership (TBO) analysis.  A TCO analysis only considers the customer’s total cost by incorporating the customer’s costs of acquiring, possessing, using, and disposing of your products.  A TBO analysis, on the other hand, combines both the costs and benefits the customer accrues from your product.  Read the related articles suggested at the end of this article for excellent examples of creating customer value.    

Communicating Customer Value 

Creating customer value in itself will not make your customers price insensitive.  The final step is to communicate the value you have created.  To do this, you must focus on quantifying the value you have created and providing tools to your sales force to communicate the value.

Value Quantification

It is not enough to tell a customer: “Our product is superior.”  Instead, say to the customer: “Our product lasts X% longer than the competitor’s; it consumes Y% less energy, and it enables you to do Z% more jobs in the same amount of time.”  Of course, these assertions must be based on unbiased data.  

Finally, provide your sales force tools to communicate the quantified value propositions quickly and easily.  I am surprised how many organizations I interact with fail on this score, much to the frustration of the sales team.  I put the responsibility of creating such tools directly on the shoulders of the marketing department.

Bottom line:  Customers do not fixate on price because it is their nature.  We make them behave like this by our failure to shift their focus to the value we are creating for them. 

* Dr. Ajay Sirsi is an award-winning marketing professor and Director of the Centre for Customer Centricity at the Schulich School of Business, York University, Toronto. Visit Dr. Sirsi's website to learn more about his work on customer-centricity at: https://ajaysirsi.com

How Customer-Obsessed Marketing Strategies Win in the Inflationary, Post-Covid Economy * [39]

 

Consider the current economic environment in the United States: gasoline $5 a gallon, inflation approaching 9%, huge price escalation in all consumer purchase categories, supply chain stockouts, the stock market in bear territory, a total lack of political leadership, and a recession imminent in the U.S. (This is not to say that things are great worldwide, as well). This market reality follows two-plus years of Covid lockdowns and restrictions. SMEs as well as giant corporations are facing unprecedented challenges in finding/keeping good employees and coping with large cost increases. Companies that survived fought back Covid and financial challenges by adapting to the new and difficult market issues and by being customer-obsessed.  

According to Forrester Research, a customer-obsessed enterprise “focuses its strategy, operations, and budget to enhance its knowledge of and engagement with customers.” They add that customer obsessed organizations are customer-led, insights-driven, fast, and connected. For further insights on customer obsession and Covid-19 responses, read articles 2 & 24 from the Customer Value in the Now Economy blog. 

Customer Value in the Now Economy: Customer Focus to Customer Obsession [2] (scv-weinstein.blogspot.com)

Customer Value in the Now Economy: Rethinking Customer Experience Management in the Novel Economy by Brian Solis * [24] (scv-weinstein.blogspot.com)

Chauvet Lighting manufactures lights and special effects equipment for venues such as concert arenas, nightclubs, theatres, and megachurches. Given the Covid-19 pandemic, like many businesses, Chauvet was forced to pursue new market opportunities such as drive-thru events such as concerts, comedy shows, and haunted houses. Other new ventures have included the production of social media content and educational videos targeting out-of-work lighting designers and repurposing video walls.

The global pandemic forced companies to rethink all business and marketing strategies to survive. This is particularly evident in the services sector which accounts for about 75% of the Gross Domestic Product in industrialized countries. Airlines, hotels, restaurants, retailers, small businesses, and universities are some of the industry sectors that had to quickly pivot to compete effectively in a new world slowly emerging from lockdowns and characterized by social distancing, contactless transactions, customers wearing face coverings, and virtual meetings.

Companies that were able to make this transition seamlessly in the Covid economy succeeded because they refused to fail and are truly obsessed about their business and customer base. They are willing to do whatever it takes even if it means struggling in the near-term to prosper over the long-term. Innovative universities offered blended learning which includes reduced capacities in the classrooms (20-33%), Zoom lectures, video recordings, and increased online instruction.

Restaurants provide an excellent case in point. Many “mom-and-pop” restaurants are micro-enterprises with twenty or fewer employees. They already are challenged by high costs (food, rent, equipment, etc.), labor concerns, local and federal regulations, and direct and indirect competition. Traditionally, they have one of the highest business failure rates in normal and good economies. In the Covid era, great food, superior service, and fair prices are no longer enough in determining winners from losers. A customer-obsessed mindset calls for adaptive and innovative business practices. Successful restaurants quickly embraced reduced indoor seating, outdoor dining options, curbside pick-up, delivery service, and contact-free credit card payments. In addition, they realized the importance of retaining existing customers and treating them as a special friend or family member, emulating Japanese style customer service. Other marketing tactics include new menu offerings such as family packs and comfort foods. Promotional strategies have to be more creative and often emphasize social media, price incentives such as BOGOs (buy one meal, get one meal free), and Covid-friendly giveaways such as branded face masks or trial-size hand sanitizers. One enterprising pizzeria even gave their customers a free roll of toilet paper with every pie ordered!  

☑ Questions to think about

1.  Is your company customer naïve, customer aware, customer-committed, or customer-obsessed?

2. Explain specific ways that your marketing strategy is customer-obsessed?

3. How can your company become even more customer-obsessed to create exceptional value and compete successfully in the Now Economy?

* Art Weinstein, Ph.D., is the blogmaster and a Professor of Marketing at Nova Southeastern University. He may be contacted at art@nova.edu

Customer-Centric Metrics Make Your Demand Generation Dollars Go Further by Laura Patterson * [38]

 

As one of the primary revenue generators for an organization, Marketing provides three essential roles: finding profitable customers, keeping profitable customers, and growing the value of these profitable customers. Customer-centric metrics offer a good starting point for identifying prospects who most look like your profitable customers, knowing which customers and products are making the largest contributions to the bottom line, and for effectively investing your demand generation dollars. 

Besides measuring customer satisfaction and loyalty, the impact on profitability is also an important measurement of any customer-centric strategy. Many companies have demand generation metrics and even measure customer satisfaction. Yet, we have found all too often that while companies say they are customer-centric, they have few customer-related metrics.

Most marketers agree that creating a satisfying customer experience positively affects a company’s profitability. The customer experience includes both rational and emotional aspects, as well as how the customer feels about the brand and the company, and what the customer thinks every time he or she interacts with the company. Having a positive impact on the company’s profitability translates into either increased revenue or some reduction in cost.

Ø Establish Profitability Targets - 3 Key Metrics

If you can calculate these three important customer-centric marketing measures, you can establish a set of customer profitability targets:

1.   Customer acquisition cost: Determined by calculating the average cost to acquire a new customer. See more below about how to use this measure in your demand gen efforts.

2.   Customer retention cost: Determined by calculating the cost to retain and serve an existing customer.

3.   Average customer profit: Determined by calculating the average value of each customer segment after accounting for standard costs.

You can monitor your success by measuring how well you are staying within your customer profitability targets for each of these metrics. You don’t need sophisticated tools to measure customer profitability. 

Ø Add Profitability Targets to Your Dashboard

Customer metrics are one of the primary categories that should exist on every Marketing dashboard. Once you have calculated these three customer-centric metrics you can set targets for each and report Marketing’s performance against the goal and Marketing’s impact on overall customer profitability on the Marketing dashboard. Overtime you will be able to use this data to determine which customers offer the best opportunities and focus Marketing investments on customers who will have the greatest impact on the bottom line.

Now that you understand which customers are profitable, you can apply this knowledge to determine which customer segments are worthy of your demand gen dollars.

Ø Customer Metrics to Guide Marketing Investment

When it comes to effectively investing your demand gen dollars, we recommend focusing on two customer-centric measures: customer value and cost to acquire. These measures when combined together can help your organization decide how much of your resources can be profitably allocated against a particular customer or set of customers.

The two customer-centric metrics we’re suggesting will help you identify the customers and/or segments to pursue. While it would be wonderful to be able to invest in every customer, most companies need to be selective.

We’ve simplified an approach to jump start your thinking process. You’re going to create a  2 X 2 grid with one axis being customer acquisition cost and the other axis being customer value.

Before you do these steps, decide which customers go where on the grid. Once you generate a list of all your customers, score each customer and/or customer segments for both customer-centric metrics.

1.   Create a Customer Value Score: To create a customer value score you will need information generated from two pieces of data: purchase frequency and customer revenue.

o    On the customer list table have a column for purchase frequency (you may want to use a numeric rating scale for this measure) and one column for revenue (you may want to create ranges for revenue and use a numeric rating scale for each range). Score each customer and/or segment. Customers who have high values on both columns (for example all customers who have either a 5 and 5 or 4 and 5 or 5 and 4 in the columns) would be your high value customers.

o    Those customers with a 5/5 would receive an overall score of 5, those with a 4/5 (frequency and revenue) you may want to give an overall score of 4.5 and those with a 5/4 (frequency and revenue) an overall rating of 4.

o    Do the same for each combination, with those customers with both a 1 in both columns having the lowest score of 1.

2. Calculate Cost to Acquire. For your same list of customers, in another column, calculate your cost to acquire each of these customers. Customer acquisition cost is the cost associated with convincing a customer to buy your product or service, including research, marketing, and advertising costs. It’s an important business and marketing metric that can be used to gauge marketing’s effectiveness.

• Again, to keep things simple, create acquisition cost ranges and then assign a 1-5 rating scale for each range (we’d suggest using 1 as the lowest cost range and 5 for the highest cost range).

Ø How to Use Your Scores

For each customer or customer segment you should now have 2 rating numbers: a number derived for the customer value score and a number for customer acquisition.

Divide your 2  X 2  grid into 4 quadrants:

• High Value/High Cost
• High Value/Low Cost
• Low Value/High Cost
• Low Value/Low Cost.

Plot each customer into the appropriate quadrant.

> Score Customers for Each Metric

Those customers and prospects similar to them in the High Value/Low Cost quadrant are where you should spend the money.

Obviously very little, if any resources, should be allocated to customers and prospects in the Low Value/High Cost. You may have to have some internal conversations about the other two quadrants and applying the customer lifetime value calculation to these customers can often help guide decisions related to customers in these two groups. While it may take some time, this is a relatively easy and affordable first step.

Unless you’re among the few marketers who have all the time and money in the world to burn, we hope employing this analysis helps you decide how to eke out the most value from your limited and precious resources. You’ve probably already come to the conclusion that the best place to spend it is on those customers who are most likely to buy.  

Got the customer-centric metrics bug and want to know what else you should be measuring? Here the top eight measures often associated with companies truly committed to being customer-centric:

1.   Customer retention

2.                2. Buying frequency

3.   Contact frequency

4.   Churn rate

5.   Average revenue per user

6.   Customer lifetime value

7.   Share of customer’s wallet

8.   A customer’s EBITDA

Conduct a quick audit to see whether your company tracks any of these customer-centric measures. If it doesn’t and being customer-centric is important to your organization, then it may be time to revisit the metrics you are measuring.

 * This post was reprinted with permission from VisionEdge Marketing, Inc. 

Laura Patterson is a marketing practitioner, consultant, writer, and speaker. Contact her at  laurap@visionedgemarketing.com. Also, check out Laura's article "The Value of Investing in Customer Value Management" [22].  Post Editor: Preview (blogger.com)

 

Service Incidents and Failures Can Actually Present Opportunities for Firms by John Gironda * [37]

                                                                  Photo Credit: Clay Banks

While most firms should strive to provide their customers with the best experience possible at all times, service incidents and failures will occur from time to time. Although these issues aren’t ideal, they do present companies with opportunities as well. Obviously, companies should not make it a habit of experiencing ongoing service incidents and failures with customers. However, in the hopefully rare times in which they do occur, if companies are able to rectify the situation, many times this ends up with customers actually being happier than they would have if things went off completely without a hitch to begin with.

This might not sound quite right at first, but if we think about it for a moment, it should make more sense. If everything goes very smoothly during a service encounter, it should lead to happy and satisfied customers, which is a very good thing. Nevertheless, when there are incidents of service failures or dissatisfied customers, and there will inevitably be at some point, this gives firms the opportunity to show customers that they care by doing what it takes to get things fixed and possibly go above and beyond in order to make things right. By doing this, companies can turn dissatisfied customers to not only satisfied customers, but also delighted ones at that.

This is because consumers tend to remember any hiccups (i.e., service incidents or failures) that occur during their interactions with companies. These hiccups can go a multitude of ways. One way is that a company does not rectify the situation and people leave as unhappy dissatisfied customers, or now ex-customers in many cases. When this happens, people tend to keep this negative feeling with them, recalling it and thinking twice the next time they consider doing business with a company. In addition, consumers may tell friends, family, and other individuals online or in-person about their poor experience, leading to negative word-of-mouth for the company. A second way that a service incident can go, is that the firm does what is necessary to make things right with the customer. In this case, customers will remember that the incident happened, but will also carry positive feelings with them, recalling that the company cared about their experience and satisfaction, and made sure it did what it could to remedy the situation.

Good companies understand this, which is related to a concept in marketing called customer lifetime value. That is, the entire stream of purchases that a customer will make with a company over the course of their lifetime. By keeping customers happy and doing what it takes to correct incidents when they occur, companies stand a much better chance of keeping loyal repeat customers for longer periods of time.

In some cases, this may mean taking a short-term loss on a particular transaction with a customer to keep them happy and retain them for years to come. This is because in order to fix a service failure or incident and retain a customer, it may be necessary for companies to compensate customers for the issue that occurred. Perhaps the customer was inconvenienced by a long wait time for their order, which can happen at a variety of businesses, from restaurants to online retailers. Additionally, perhaps there was an inability to fully accommodate a customer’s request, or the customer simply did not like a particular product and would like a refund.

In terms of customer compensation for inconvenience caused by service incidents, a little bit of compensation can go a very long way in terms of being meaningful to customers. These can be things as simple as taking something off of a customer’s bill, giving the customer an additional item for free, a discount voucher for a future purchase, or additional points towards the company’s loyalty program. Clearly, the type of compensation needs to be commensurate with the type of incident that occurred. However, as the old adage goes, many times it’s the thought that counts more than anything. Additionally, another important factor in the exchange is speed. Incidents should be corrected as quickly as possible, which also means that companies should empower employees and give them some autonomy and leeway to make things right promptly without having to wait on approval for every little thing, within reason of course.

What are your thoughts on this? Do you agree that service incidents can actually present an opportunity for firms? Can you think of any positive examples of times when an incident occurred and a company went out of its way to remedy the situation for you? What impact did that have on you and your future relationship with that company? Please share your thoughts in the comments section below.

 

John Gironda, Ph.D., is an Associate Professor of Marketing at Nova Southeastern University, Fort Lauderdale, Florida. His teaching and research interests include digital and social media marketing, consumer behavior, marketing strategy, consumer privacy issues, and integrated marketing communications. He can be reached at: jgironda@nova.edu

 

Customer Delight - That Sounds About Right or Not Quite? * [36]

There are two schools of thought on customer delight -- it is an extreme form of customer satisfaction (very satisfied) or it is a distinct marketing construct. While the latter position has gained traction recently, this debate is far from settled.

Highly Satisfied or Customer Delight?

> Position A - Highly Satisfied

Customer satisfaction is frequently measured on a five-point Likert scale. While there are many variants of the approach, it is typically measured as follows: 1) highly dissatisfied, 2) dissatisfied, 3) neither satisfied or dissatisfied, 4) satisfied, and 5) highly satisfied. The “5” option may be viewed as a proxy for customer delight. In such cases, customers tend to be highly loyal and not prone to defection. The “4” score implies satisfaction but since it is not strong, customers generally are not very loyal and may defect. Customer satisfaction measures of 1-3 imply major or minor levels of dissatisfaction. In such cases, customers are likely to seek alternative vendors.  

This is analogous to the single-item, 11-point Net Promoter Score scale where respondents that give the organization a 9 or 10 are highly satisfied (promoters); 7 or 8 are somewhat satisfied (passives); and 0-6 are dissatisfied (detractors). Bain & Company has found that long-term value creators such as American Express, Publix Super Markets, Ritz-Carlton, and USAA have NPS scores of twice that of the average company and leaders grow at twice the rate of competitors. The customer satisfaction metric is so important that Lexus uses this basic scale in assessing service quality for their vehicles. In fact, one of their research instruments advised customers to immediately call the service manager if they were not totally satisfied with the service experience (i.e., unable to respond with a “5”).                          

> Position B - Customer Delight

Superior customer value means to continually create business experiences that exceed customer expectations. Innovative companies such as Tesla are not content with customer satisfaction; they strive to amaze, astound, delight or wow them (at least some of the time). Tesla’s $35,000 Model 3 electric vehicles received more than 400,000 pre-orders more than a year before it went to market. Other exciting business initiatives by Tesla include its multi-billion dollar Gigafactory (a battery production facility) and futuristic Hyperloop transportation system. 

While the pursuit of exceeding customer expectations is quite desirable, reality often dictates that customers are most satisfied when firms avoid disappointing them rather than trying too hard to delight them. Therefore, organizations must focus on the business fundamentals and have a flawless execution of operational basics. In rare instances of service failure, service recovery must be a priority. In most cases, customers can not truly articulate how to improve service experiences or what they are seeking to be delighted. 

In contrast, customers can readily identify attributes that are dissatisfiers/hygiene factors (must-haves) and satisfiers (nice-to-have attributes). The hygiene factors constitute the minimally acceptable level of service attributes that customers would expect to be present in the service offering.  For example, a mid-priced hotel catering to business travelers would be expected to offer such services as express check-out, fitness room, high-speed internet connections, a restaurant, and a lounge. Failure to offer these services or to perform or deliver them poorly will likely lead to dissatisfaction. In contrast, simply offering these services and performing them adequately will not delight the customer --the customer expects them as part of doing business. 

Truly delighting customers requires service providers to carefully consider satisfiers.   Satisfiers are those service attributes that both differentiate the service firm from its competitors, while at the same time exceeding customer expectations in one or more areas of service by delivering above what is expected.  Hygiene factors need to be delivered at an acceptable level before satisfiers become important. Satisfiers have the potential to create high customer satisfaction levels once expectations on hygiene factors have been met.  Firms that would offer satisfiers need to consider the value-added services that would both delight and surprise the customer. It should be emphasized that service quality is more than simply meeting specifications and that the customer's point of view is what matters (i.e., is the customer delighted?) Hence, customer satisfaction is what the customer says it is.

Consider some of the following examples in the effective use of satisfiers. Before a guest ever sets foot in Le Parker Meridian Hotel in New York they can use the hotel’s QuickTime Virtual Reality (QTVR) enabling potential guests to "walk" through the lobby and rooms.  In addition to virtual reality tours, the site offers in depth, timely information about room rates, events and points of interest for the business and pleasure traveler. The hotel also welcomes repeat guests with amenity baskets accompanied by handwritten notes.                          

Zappos, a billion dollar shoe, handbag, and clothing company owned by Amazon, aims to deliver “Happiness in a Box.” Their three-part formula is to: 1) meet expectations by delivering the right items, 2) meet desires through free shipping, free return shipping when necessary, and a 365 day return policy and 3) often delight customers via surprise upgrades to overnight shipping.

And conversely, bad-mouthing by dissatisfied customers can be not only harmful, but the very death knell to a company. Consider a case in point: one unhappy buyer at a computer superstore determined that this company lost $50,000 of his business (direct lifetime value) and another $350,000 (indirect lifetime value) due to negative word-of-mouth comments to his family and friends! Today, it’s very likely that dissatisfied consumers will post a bad review on Yelp, Facebook or Google. Negative comments via social media (word-of-mouse) can easily go viral leading to the need for damage control, a potential significant loss of business or even consumer boycotts.

Art Weinstein, Ph.D., is a Professor of Marketing at Nova Southeastern University. His research interests are customer value, market segmentation and entrepreneurial marketing strategies. He may be reached at art@nova.edu 

 

Know Your Customer to Bulletproof Your Marketing Strategy by Fernanda Almada * [35]

Working in today’s digital marketing landscape has become increasingly challenging. The markets are crowded, and changes are happening in an extremely fast pace. As marketers, we know that it is necessary to find a way to learn and adapt quickly. Otherwise, we will fail — as professionals or as businesses. However, there is one key component of any marketing strategy that is bulletproof: your customer.

It may seem obvious, but the truth is that the current times require a much higher-level understanding of who your customers are, and what are their needs, wants, and desires. And this goes way beyond demographics. It is essential to dive deep into their biggest dreams and fears so you can develop an effective marketing strategy that speaks to these very specific pain points and transformation goals.

When you have this level of comprehension around your customers, you will be able to craft the best offers that will turn them into raving fans and will make them stick around for much longer. That is when the magic happens: highly satisfied customers who are willing to buy repeatedly from you and advocate for your brand and business. This is when you will see an increase in your customer lifetime value and will be able to accomplish continued revenue growth.

Targeting Strategy

Before you start working on the real understanding of your customers, it is essential to take a step back and define who these dream customers are, which target markets you should go after, and assess this decision before moving forward. Some of the key factors to consider are the size of the segment (is it large enough to be profitable?), the competition it faces (how strong are your competitors?), and its alignment with your business’ overall goals (is targeting this segment compatible with your long-term goals?).

When you analyze different marketing campaigns from companies such as LinkedIn, Hulu, and Clorox, it is clear that they target different market segments and may have various lines of businesses to cater to them. LinkedIn, for instance, the world’s largest professional network, runs ads directed both at job seekers and advertisers.

Hulu also targets advertisers in addition to subscribers. And if you are wondering if Clorox only targets women in their marketing campaigns, that is not the case. Headlines such as “Cleans & kills germs: Helps build business” show that their strategy and creativity go further than traditional segments and that they also cater to business owners.

Booking.com is another great example of company with unique ad campaigns running simultaneously but targeting distinct audiences. Besides travelers (“Book the perfect stay with peace of mind”), they also promote their services to hotel professionals (“Attract summer bookings”) and business professionals (“All your company’s travel in one place”).

Standing Out from Competitors

The origin of these powerful headlines is in the company’s value proposition. Many marketers underestimate the importance of crafting a well-written value proposition, skipping this important step that dictates the entire marketing strategy. The combination of what your customer wants and what you are able to offer like no other business is what will help you create outstanding marketing strategies to propel your growth.

Strong taglines such as Amazon’s “Spend less. Smile more.” or Gillette’s “The best a man can get.” translate these companies’ value proposition in an attractive way and reinforce the reason why their dream customers should buy from them, and not from the competition.  

The same happens with the creation of marketing campaigns. The high-level understanding of your customer will come into play at the execution phase as well, with the development of variations of ad creative and copy that translate both the company’s positioning and the fulfilment of the client’s desires.

By highlighting benefits (instead of features), showing the removal of problems, elevating power-status, or providing sensory gratification, marketers create opportunities to continuously drive customers that are interested in each offer.

As Philip Kotler says, “Good marketing is no accident. It is both an art and a science”. And it does take a lot of testing and optimizing to create winning strategies. And if something doesn’t seem right, it is probably time to revisit the initial definition of what your company is and who your dream clients really are before going back to the drawing board of your ad campaigns.

Sources:

- Consumer Behavior, Leon Schiffman & Joe Wisenblit, 12^th edition, 2019.

- A Framework for Marketing Management, Philip Kotler & Kevin Lane Keller, 6^th edition, 2016.

-  Facebook Ad Library

* Fernanda Almada is a digital marketing strategist with 15 years of professional experience. She currently works as a marketing project manager at a digital marketing agency in South Florida in addition to managing her own online business. Fernanda has an MBA with a concentration in Marketing from Nova Southeastern University and can be found on Instagram @fernanda.almada.