How do you identify your prospects? Many organization have a tendency to provide the solution without really spending time identifying the specific market that their solution fits. That is one of the ideas that have made Eric Reis’s Lean Startup movement so strong. He calls it the Pivot. Which in very basic terms: Creating a minimum marketable product and getting it in the hands of real people to provide the feedback in the early stages of development.
It is a great concept for a startup but what if you are an existing company? You have existing markets and products. In fact you may be saying this, “I am a 20-year old company with an existing database. Sales are down because of the economy. We just need to create more awareness and get more opportunities. Our products will work in others markets; we just need to start talking to more people.” There may be a little truth in what you’re saying, but I want to emphasize “little.”
The economy has changed, it may get better but there are some fundamental changes that have taken place. You better learn how to make money in this economy because even with a shift for the better, I doubt that it will ever return to yesteryear. Creating awareness and opportunities will help but this is the most expensive means of selling products, can you afford it? If you are looking at selling your products in other markets, guess what? There is already an established company fulfilling that solution for that market? You better discover a significant advantage for your product and be willing to spend more than the existing provider to take market share away from them.
The secret sauce for any marketing improvement begins with identifying the correct product/markets for growing your business. All opportunities are not equal. The Six Sigma Marketing Institute uses a modified DMAIC procedure in their 5 Cs of Driving Market Share Program (Disclaimer: I assisted in the creation of this program) and starts with the Define or Customer Identification phase. Maryland World Class Manufacturing Consortium after having gone through the define stage of Six Sigma Marketing was amazed to find that they were spending the majority of their time and money on a market that was providing a scant 5% of their returns.
You have to identify your markets. Many companies identify their markets by product line. Products are sold, people buy things. The best way to identify your market is “Who are the buyers?” Without doing this you lose sight of your market and how they place value on your product. Ultimately, what we seek in identification is an understanding of value from the customer of that particular product. I think an interesting concept is not to have Product Managers within a company but Value Stream Managers. As Drucker said, “Marketing is revenue, everything else is an expense.”
After you have identified your prospects another method used in Six Sigma Marketing is defining the opportunity or product/market based on your ability to compete. If there is already a provider in this segment that provides a better solution at a better price with better delivery, you may have a problem. You can save yourself a lot of money by assessing how attractive this market is by doing your research. Some markets are worth more to an organization than others. Your organizations capacity to compete within a potential market or customer segment is critical to any strategy.
Using a Value Stream Marketing Channel is an interesting visual tool to consider. If you create a Value Stream Map for your marketing process and a map of your competitors marketing process, you may discover some very interesting analysis. For example, one of you may have a more direct sales channel or purchasing may be through engineering driven request or through a dealer, etc. A blog post of mine that takes a deeper dive into this: Providing Clarity to your Marketing Process.
If you are doing a startup or attacking a new set of prospects many of these items may seem overwhelming to do. However, they are very worthwhile. The easiest way I have found to start is by identifying and segmenting an existing product into a product/market. Discover your customer and quit hiding them within your product. Get rid of Product Managers and create Value Stream Managers!