thefunnel

This is the story about a shoe manufacturer who wonders whether a market exists for shoes on a remote island. He first sends an order taker to the island to investigate the market opportunities. The order taker visits the island and reports back.  “The people here don’t wear shoes. There is no market”. 

Unsatisfied with the answer the shoemaker then sends a sales person. The sales person returns and reports.  “People do not wear shoes. There is a tremendous market.” 

Now completely confused the shoemaker sends the marketing person. The marketing person too visits the remote island, returns back and reports out.

“The people here don’t wear shoes. However they have bad feet. I have shown the chief on the island how shoes would help avoid these foot problems. He’s very enthusiastic. He estimates that 70% of his people will buy the shoes at the price of $10 a pair. We probably can sell 5,000 pairs of shoes in the first year, because there’s currently very little competition. Our cost of bringing the shoes to the island and setting up distribution would amount to $6 a pair. We will clear $ 20,000 in the first year, which, given our investment, will give us a rate of return on our investment of 20%, which exceeds our normal ROI of 15%. This is not to mention the high value of our future earnings by entering this market. I recommend that we go ahead.”

Here’s a simple digital marketing model for B-2-B that can be used when planning what the strategy for the web should be and how to measure this. The thinking is that the customer typically have four different types of interactions on the web, depending on where he is in the buying cycle. The customer is either in a learn, buy, use or engage phase. Learn and buy is very much at the core of a new/repeat or modified repeat purchase. Use have both a support and a service aspect to it, and engage is when the customer is idle. The idle phase in particular can be problematic for products , for which a replacement purchase only happens every few years, and the customer therefore is not a “hot prospect” and often “forgotten”. Managing the idle phase takes clever pull marketing, but correctly done, increases the likelihood of a re-purchase. The find in the middle of the chart, reflects the important of search, both external and on-site, regardless of what phase of the buying cycle the customer is in.   Digital Marketing Model

There are lots of words in marketing.  Strategy, objectives, vision, goals etc. , but what is really required for marketing to be successful? One of my managers, a few years back explained this by saying, “there are five key questions, to which you always need to have the answer,  and if you do, it will help you to be successful  marketer”. These five questions, permanently stuck into my mind are:

• Do you know the size of the market, customer segments, customer buying cycles and the your current position in the market?
• Do you have clear priorities?
• Does your plans align with, and reflect the goals of the sales organization?
• Are there clear measures of success and failure?
• Do you have a vision of the most outstanding growth opportunity?