By Ryan Townend.
We’re Canadians — we don’t like talking about ourselves. Instead, we’ve historically preferred to let our work do the talking for us.
For decades, that approach served us just fine. Manufacturing surged on the back of innovation, sheer determination, and quality of service, while the rest of the economy rode a wave of commodity demand and resource development.
But a lot has changed in the past 50 years. That little thing called the Internet was introduced, for starters, and the world has consequently become a much smaller place. What previously could only be done in a capital-intensive factory can now be accomplished in a home office, and the global borders of competition have all but evaporated.
Marketing now matters. The truth is: It’s always mattered. But never before has it been such a defining line between growth and stagnation.
The problem is many manufacturers find it intrinsically unnatural. Often, at best, it is a function isolated from the rest of the company — a department or lonesome individual for which there is no table in the middle-school cafeteria. At worst, it doesn’t really exist.
If you fall into either of those categories, please remember there is hope. Marketing doesn’t need to be a dirty word, associated with wasteful spending and Don Draper-type haircuts. It can be a power for good — jobs, revenue, higher wages, a happier boss (or board). Just be sure to avoid the ‘seven deadly sins’ that can turn any marketing strategy into a big, fat albatross on your bottom line:
1. Relying on reputation without a strong brand
When asked what separates them from the competition, manufacturers routinely speak of their sterling reputations and unsurpassed experience. All likely true, I should add. Most, however, fail to understand that reputation and expertise are good ingredients for survival — not to become a market leader. For that, you need a brand.
These two concepts are not the same, although reputation is part of the brand equation. A brand is the full expression of the character and value of a company, and what makes that company special. It isn’t merely a logo, a tagline, a culture, or a customer experience — it is a representation of all those things. Think Kleenex, think Band-Aid, think Disney. These products, these companies are more than the sum of their parts.
A compelling brand is essential for one reason: Money. According to a recent study, companies that have successfully established a leading industry brand name command a price premium of up to 14 per cent.
2. Not supporting your sales force
Efficient selling requires effective marketing. Salespeople are often more effective than broader marketing tactics alone, especially in a B2B context, but the cost to sell directly to the customer is much higher. Efficient selling requires an optimal mix of direct-selling and broader marketing initiatives to reduce the cost of each sale and increase profitability.
The job of marketing is to create a suction of demand. Your strategy should have measured key performance indicators, including, but not limited to, a greater volume of leads and shorter sales cycles.
Think of it this way: You employ the best carpenter in your community. He brings 30 years experience, a great attitude, and a reputation for finishing on time and on budget. Is his day best spent making cold calls? And when there is work in the queue, why would you send him out to the jobsite without the right tools?
3. Ignoring technology
Don’t discount social media just because you’re not sure of ‘the fit’ with your business. If you sell anything, employ any number of human beings, pay taxes, or are invigorated by new ideas, trust me, there’s a fit. You’ve heard of YouTube, correct? It’s more than a time-sucked universe of cat videos and make-up tutorials. For manufacturers, it can also be an instant product manual, capable of visually demonstrating everything from installation to repair in a way that transcends language or reading comprehension.
4. Refusing to stand out
Be honest with yourself: Do you manufacture a product that another company, somewhere in the world, couldn’t manufacture as well? Doubtful. The pace of competition is rampant. Yes, you need to amplify your message to standout; but, if you have a dozen different voices yelling at the same time, what do you get? Just a lot of noise.
Marketing is there to cut through the noise — to define your unique value proposition. Take, for instance, Canadian Isotope Innovations (CII), a Saskatoon-based start-up manufacturer of the most-used medical isotope for diagnostic procedures. Most of their competitors were presenting themselves through the lens of science, lab coat-clad and surrounded by highly advanced equipment. CII quickly realized, however, its reactor-free isotopes were good for both people as well as the environment — so that is exactly where we took their brand: A healthier world with healthier people.
5. Failing to understand your customers
You know your customers, right? Of course you do. That’s what’s gotten you to this point. Okay, well let’s talk about taking you beyond ‘this point’ to a bigger, better, and more profitable place. For that, you need to dive deeper.
Knowing your customers well sounds like a simple feat. After working on hundreds of projects with manufacturers and processors across the Prairies, though, I can tell you it is not. That becomes exponentially more challenging as your business grows internationally, sometimes to markets that speak a handful of different languages and hundreds of different dialects. Do you know their media consumption habits? Do you know their cultural norms? Have you properly translated your materials? Assume nothing.
6. Being too thrifty
Few respect the importance of marketing as a revenue generating activity. It is not an expense; it is an investment — an investment for which you should expect to receive a significant return.
So, how much should you be spending on marketing? For as many so-called ‘marketing experts’ you ask, you’re sure to receive at least as many answers. The magic number frequently floated around is 10 per cent of annual sales. And while that may represent a half-accurate benchmark, it is in no way a one-size-fits-all solution.
Are you marketing a new product? Are you an established company? These questions influence the requirements. Keep in-mind that manufacturers actually outpace the business average for investment levels, too. It is not uncommon for manufacturers to spend 20, even 30 per cent of revenue. The age-old adage is true: It costs money to make money.
7. Executing without focus
I won’t beleaguer the point, as I’ve mentioned it a few times already, but it is the deadliest of sins, so let me repeat once more: Marketing is an investment that must drive performance. Set and hold true to metrics. Align tactics to objectives. Track and report on results. Otherwise, you will not be successful.
Ryan Townend is the CEO of William Joseph Communications, an award-winning marketing firm, with offices in Calgary and Saskatoon.