What exactly do marketers do? This is a question that is almost always the first thing addressed in any introductory book, class or tutorial on marketing. What is most interesting about answering this question is that while academics, consultants and, yes, even websites like KnowThis.com, generally provide a similar explanation of the tasks marketers perform, things are often a bit fuzzy when it comes to what falls under the marketing discipline within the business world.
A good example of this occurs in organizations where there are separate responsibilities for those involved in marketing and those involved in sales. This is despite the general textbook definition in which sales is almost always considered to be a part of marketing and should not be separate. Of course, this is not the only example. For instance, product development, while considered the responsibility of marketers, is frequently not viewed as a marketing function, instead designers and engineers may take on this role. The same holds for public relations that is often a standalone department that not only handles product issues but also takes care of corporate PR.
There are even organizations where marketing is not even used to explain what people do, even though they do it. For example, beginning July 1, Procter & Gamble will no longer use the word "marketing" in job titles. Instead, the focus will be on "brand" management which, according to this Advertising Age story, will have these folks focusing on key issues related to individual brands. Before the change, P&G marketers were somewhat focused on more limited marketing issues, which likely included an active focus on promotion and pricing. However, as discussed in this story, the new functions, which seem to now include marketing research, public relations and product design, are functions that we define as being part of marketing.
Curiously, while job titles at P&G may change, the basic responsibilities appear to actually cover more marketing than what these executives used to cover.
A tough sell for any marketer occurs when their target market has preconceived notions of a product that leads potential buyers to feel a product is not right for them. The objections for believing a product is not right can cover many reasons, such as customers not believing they have a need for it or not understanding the benefits offered or presuming a product is just too expensive.
To address this, marketers must fully understand why tough-to-sell-to customers are resistant by conducting marketing research. Only then can a marketing plan be laid out to overcome customers' objections.
A good example can be found in this Advertising Age story that discusses what Chinese customers think about dishwashers. According to the story, only 1% of Chinese households have dishwashers. Research suggests low adoption of dishwashers is due to cultural issues, such as kitchen products not being viewed as a status symbol. Research also discovered that customers' believe dishwashers often create problems, and the cost of using them can be significant.
To address this, dishwasher manufacturer Siemens and detergent marketer Reckitt Benckiser have created a test apartment where potential customers, recruited via social media and word-of-mouth promotion, can hold parties. As part of the time they spend at the apartment, party guests receive a product demonstration and get to experience the products. So far the strategy appears to be working, at least in terms of attracting people to visit the party apartment. Although it is unclear whether this promotion is yet to positively impact sales.
There is an excellent story in the New York Times reporting on the success rate of new consumer products introduced in the last few years. The information, produced by marketing research firm Nielsen, shows that out of nearly 17,000 new products introduced since 2008 only 62 achieved modest sales of at least $50 million in the first year on the market and then followed this by experiencing a sales increase in the second year. These results point up the challenges marketers face with introducing new products in a cluttered competitive market.
To address the risks surrounding new products, another story in Advertising Age discusses how more marketers are turning to a co-branding strategy. As we discuss in our Managing Products tutorial, a co-branding strategy occurs when two or more known brands share a product label. In some cases both brands are owned by the marketer, such Crest Toothpaste with Scope both owned by Procter & Gamble, while in other cases the brands are from two different companies, such as Betty Crocker teaming with Hershey to market a cupcake mix. The principal advantage sought by a co-branding arrangement is the expectation that the power of two brands will lead to faster customers' acceptance, especially if each brand appeals to a different target market. Additionally, depending on the co-branding relationship, the cost of introducing the product may be spread over each brand.
The Advertising Age co-branding story presents examples of six recently introduced co-branded products. Sometimes the joining of brands makes sense, such as Kellogg's Peanut Butter Cereal that features Jif brand peanut butter. Other times, you have to take a step back and question how the brands can work together. For instance, the combination of Dial Body Wash and Froyo Frozen Yogurt may seem a bit odd.
When it comes to promotional techniques that are the most effective in business-to-business markets, it is safe to say that personal selling is still king. Despite the emergence of powerful Internet and social media promotional methods, convincing a business to make a purchase decision often requires a real salesperson establish a personal relationship with a buyer. In most cases, developing the relationship that results in a sale requires the seller meet the buyer face-to-face at the buyer's place of business.
In the consumer market, things are a little different. Consumer buying decisions are heavily impacted by non-selling promotion, such as advertising and sales promotion, rather than direct selling. Also, consumers make the majority of buying decisions on their own and not with the assistance of someone representing the products they purchase. However, this does not mean personal selling is not necessary in consumer markets. As we note in our Types of Selling Roles tutorial, direct selling by salespeople to consumers does happen. For instance, selling is easy to see when a salesperson assists a customer who is shopping in an upscale furniture store or when an automobile salesperson intercepts prospects as they enter a showroom.
There is another type of consumer selling that occurs where consumers come to a location and are engaged by a seller. These situations are best described as "home parties" where a host has invited many guests to their home (or other location) to listen to a seller explain their products. Over the years, several companies have successfully used this selling approach with the most well-known being Avon, Mary Kay Cosmetics and Tupperware.
Another example of home party selling is found in this Wall Street Journal story. It discusses a company called Willagirl that markets skin care products. But what makes this story interesting is that the sellers are not professional saleswomen or salesmen; the sellers are middle school aged girls. The direct selling technique used by Willagirl is similar to what Avon and others employ, including encouraging attendees to sample a wide range of products. For the young saleswomen, the company offers a high commission and enables sellers to earn a percentage of sales made by others they recruit to become sellers.
In April, we reported on an interesting case that was to be heard by the U.S. Supreme Court. The case revolves around the labeling of food products and specifically whether a company can sue a competitor for misleading labeling even though the label meets U.S. Food and Drug Administration (FDA) regulations.
The case involves POM Wonderful, a small juice product firm, and mega-marketer Coca-Cola. POM claims the label for Coca-Cola's Pomegranate Blueberry Juice is misleading because the product contains less than 1 percent pomegranates and blueberries. POM sued but was rebuffed by lower courts that said Coca-Cola's labeling was covered by certain FDA rules and, consequently, POM could not sue. POM was not satisfied with lower court rulings and took the issue to the Supreme Court.
The Supreme Court has now ruled with the voting members unanimously supporting POM's right to sue Coca-Cola. While the decision by the Supreme Court is a win for POM, it only means they can go forward with a lawsuit. Whether they can successfully prove their claims in a lower court remains to be seen.
However, according to this Advertising Age story, there may be far greater implications of this decision as it may lead many other companies to file misleading labeling claims against competitors. It may also be a wake up call for marketers to begin exercising greater care when designing their labels or face a potential legal response from competitors.