It came up in conversation that marketing is “a necessary evil” and an overhead! I can understand that some companies have had bad experiences and have come to feel this way – and I know only too well how careful businesses need to be with their budgets! But whoever made this remark was clearly not getting their marketing right. Marketing should be the biggest and best investment you can make to enable your business grow.
What is Marketing?
It all depends on how you define it. Many people think of it as making brochures, websites, exhibition stands and fluffy PR – it can be viewed as a little arty by those on the engineering side of things. However to be more precise, those aspects of marketing should really come under the heading of Marketing Communications. The real scope of marketing is wider than this. The classic concept of “Four Ps” defines it much better: product, placing (for this read distribution or route to market), pricing and promotion. In most companies, the marketing department is focused on the fourth “P” – the promotional work – but the four Ps model is spot on because it puts the elements in the right order. There is other work to do before the promotional work can be successful – the product has to be right, the pricing has to be right and the route to market has to be prepared.
I will add a note about markets here. The size of a market will dictate the size of the opportunity for an individual company – and the number and relative strength of competing companies in the same market sector will have a bearing on the share that each single player can reasonably expect to achieve.
I believe that for marketing to be successful – and in this instance I mean promotional marketing – a number of other business questions must be considered first. Top of the list is research to understand the size and scope of the market, competitors, and the potential demand and opportunity for the product or service on offer. Then, the product or service needs to be shaped so that it fits with that demand, at a viable price.
If the background research has been realistic, and if the product or service design and pricing are right for the market, then the promotional work should bring good results.
This article is about marketing budgets, not messaging, so I will not discuss propositions in detail here. However, to conclude, I would say that provided there is a real opportunity in the marketplace, increasing your promotional work should bring a real increase in business – and that those businesses that have done their research and have spent more on their promotions than their competitors will almost certainly do better in the longer term. This doesn’t favour smaller competitors – which is why the great business gurus like Michael Porter advise smaller companies to specialise in market niches where they can achieve visibility and success without such a large investment.