The Self Proclaimed Reduced Definition of Marketing

Forget the (Used to be 4, now the number is somewhat random) Ps

What is Marketing?

“A set of activities designed to support, enhance or create the act of making profits without compromising the company’s image.”

Everything else is a waste of company’s resources.

On Price and Competition

I am reading an interesting piece of article “How to Beat a Lower-Priced Competitor” which I can clearly relate to because I am currently working in such a very competitive industry. Here is the digested read.

Everyone has this vague idea that price wars will bring about utter destruction to everyone and potentially destroy an industry or survivor takes all.

“When customers prefer the lower priced of two items, it’s usually because they believe the cheaper item is a better value. To compete, you need to get the customer to value your product more than the competition’s — regardless of the price.”

Ed: How True… This statement should be embossed to the bottom of every boss’s and manager’s head.

Action Plan

1. Lowering your prices = Changing manufacturing and distribution 2. Building a uniquely better product = Changing design and engineering. 3. Creating a hassle-free experience = Changing sales and marketing. 4.Taking ownership of the customer’s results = Changing customer support

Reposition, Readjust, and Reallocate

1. If you offer lower prices, mimic the competition’s go-to-market strategy. 2. If you build a uniquely better product, target your advertising. 3. If you create a hassle-free experience, generate positive word of mouth. 4. If you take ownership of the customer’s results, create a presence as an industry insider.

Blogger’s Evaluation: Why does so many company fail then?

These are the summary of the author’s points needed to basically survive in a heavily competitive industry or deal with a cost cutting rival. These are very good points but ultimately many companies fail to create an ideal business strategy to counter competition due to the following reasons.

1. They try to do all of the above all at once instead of priorities on the most important things to do. A house has to be built from the base up and not all at once. How are they going to built the 3rd floor when the first floor is left uncompleted? First things first. Shore up the Core Competency of the company.

2. Usually, companies see cost cutting (especially shedding employees) as the easiest solution to reduce price instead on the emphasis on enhancing the value of the product). Cost cutting just leads to more cost cutting and will cripple a company fatally if the other companies improve productivity to increase volume and lower prices instead of cutting costs.

3. Politics. Management at odds with how to deal with this situation and the company ended up doing Point 1 or none at all. A Classic factor.

4. In many industries, efforts has been made into business planning but in the end, whether a company succeeds or not depends on whether its strategy is better than the other. Its like an Olympic race, every athletic does his homework, hires specialists to the hilt, trains every day but only one will win simply because the winners simply has the better preparation strategy.

5. Great product, great price. Bad PR, bad customer service, Terrible Online Shopping page. Turns customers off straight away.