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.”

The most important thing for any marketing / communication plan! Way too often marketers forget the basics and jump straight into messaging or even tactics, when following the simple rule of segmenting – targeting – positioning – messaging. When positioning is done correctly there’s no doubt about what and who the product / service is for and what it’s uniqueness and value, out of which the messaging almost flows ”automatically”. Positioning is a very good acid test, and if not convincing enough the success rate diminishes. One other common mistake is trying to write a positioning statement like a message or tag-line. Fails every time.