Both in startups and large companies—heck in any company—culture is critical to success. This is something that I’ve been waxing about for close to 20 years now. And the criticality of storytelling in businesses is another favorite and recurring topic in this blog. So I was tickled this morning, to come across an interview of Paul Teshima, CEO of Nudge (and formerly of Eloqua) being quoted saying
culture eats strategy for breakfast, and business culture can be built through storytelling.
What was particularly gratifying about this was his assertion was made in the context of marketing and sales. Sales folks have always understood that relationships are critical to their success. However their challenge has been to quickly identify and nurture the most promising ones, as they balance their need to deliver on results on finite timelines with the lead times of building meaningful relationships. Good marketers recognize that their job is to help sales shorten their selling cycles, by getting qualified leads to them consistently. Storytelling is a powerful to achieve this and a culture that promotes such consistent storytelling to customers and serving sales’ needs will always will the long game.
There is no greater impediment to the advancement of knowledge than the ambiguity of words. Thomas Reid
Photo credit: Gerard Stolk (vers Noel)
The trouble with most of us who speak in the English language is that we assume that people actually understand what we are saying. This last semester, as I set out to teach a course on International Marketing, I happened to ask the class casually, “How many of you understand the difference between marketing & sales?” The faces, more than the raised hands, clearly communicated the confusion over the two. So as I set out to clarify the difference, I learned a thing or two and reckoned I’ll share that with you.
Let’s get the basics out of the way. And in the interest of not reinventing the wheel, I’ll share what I reckoned was a good definition from Diffen.com.As they summarize it
Marketing The goal is to generate awareness and interest in the product/service and create leads or prospects, by influencing the perception and behavior of the target customer group.
Selling is focused on converting prospects to actual paying customers. Sales involve directly interacting with the prospects to persuade them to purchase the product.
This means the activities done by marketing and sales can be quite distinct
consumer research to identify the needs of the customers
product development – designing innovative products to meet existing or latent needs
advertisingand digital marketing the products to raise awareness and build the brand.
pricing products and services to maximize long-term revenue.
focused on converting prospects to actual paying customers. Sales involve directly interacting with the prospects to persuade them to purchase the product.
So far so good. Now that we are clear about definitions, does this help us figure out when does your business require marketing (or sales) and how much of it does it require? As we set out to answer this for some examples, I realized that there was some nuance to this, especially when it came to a matter of
target customers – are yours’ consumers or other businesses
sales channels – do you sell direct or through channels
Of course, neither of the above is an either/or answer. You could have both consumer and business sales (think airlines, catering or training classes) and could be both direct or channel (advertising, over-the-counter medications).
While the role of marketing remains building awareness and generating demand – its relative contribution and nature of activities depend on which of these combinations your business falls into. With the rise of internet and e-commerce, certain categories of consumer-targeted businesses can operate without any sales force at all. Similarly, business-focused sales channels, which are businesses themselves such as aggregators or distributors, rely primarily on the marketing of their principals to drive demand. Even these folks have to market themselves to stand out from their competition.
Here’s a useful framework (and some examples) to think about this. What is the product or service you are selling and to whom are you selling it and how will you sell it to them? And what marketing will be directed towards whom? And what sorts of sales activities and personnel will you need to meet your goals?
Here are two different examples of companies that sell primarily to consumers (airlines, cars) or businesses (Facebook ads) and what they do for sales & marketing. Of course, all these businesses serve both consumers and businesses to varying degrees.
I’d love to hear how this looks for your business. Happy hunting.
Recently I had to travel to Bhimavaram in West Godavari district of Andhra Pradesh. Of course I had to look it up on Google Maps to figure out where it was. It’s about a 120km north northeast of Vijayawada. As my daughter had to be there at 9am on a Saturday morning and had forgotten to tell me but five days before, I had to scramble to make the arrangements. Now that I’m back in Bangalore I realize somewhat belatedly how everything we needed was handled almost a 100% online.
The Economist in its latest issue talks of Indian technology firms and where they may be headed. While I didn’t agree with everything they asserted, my own experience of making it to Bhimavaram and back resonates very well with their core premise that technology, the web and mobile have already changed Indian businesses irrevocably. Here’s what I found and learned.
Google – of course this is where it began – with Google Maps figuring out where Bhimavaram was and the nearest airport – Vijayawada in this case. Cleartrip was my next stop to check out airline tickets. Once I found JetKonnect had the best connections checked out their website as well and bought the tickets there directly. Usually when travelling to a new city, I’d call friends, to see if they had any recommendations for hotels. Given I was travelling with my daughter, I checked TripAdvisor for reviews and everyone seemed to suggest the Taj Gateway awas the way to go. So off I went to TajHotels website. Then I had the bright idea to check hotels right next to them – as in centrally located by not as expensive. I decided to check out Stayzilla who’s ads I’d seen in Bangalore – and they got me a good deal at the Taj Gateway. Then off it was to find a rental car. I called the Taj up and asked them to refer a cab company. Once again I felt the cab rates were quite high and so a quick Google search revealed a service called Saavari.com that fit the bill – they could get you a cab (including rates, ratings, the works) in practically any city – most importantly in Vijayawada in this instance. However, I couldn’t figure out a few things re quoted price online, so I called them on their toll free number. They said they’d get back to me and never did. So in the meantime I kept searching and here’s where GoogleLocal came in real handy. Several cab companies in Vijayawada had excellent reviews ratings on Google and I reached out to one of them over the phone after checking out rates on their website (which I’m finding hard locate just now). So here we were four days before our travel, with flight tickets, hotel bookings, local taxi rental all done over a couple of hours online and on the phone – to a city we’d never been to, whose language we did not speak and with some measure of perceived safety for my teen traveller.
Online reviews matter – the hotel we ended up staying in had good reviews on TripAdvisor. The cab we used had good reviews on Google local. These were instances of a local supplier beating out a larger national “professional” supplier. Social and community word-of-mouth is getting better, even it’s not from someone personally known to us.
Websites matter – Even after locating the cab company via a review, the fact that their website had clear rates, reviews and contact info is what tipped us over. Good websites matter – Savaari.com and Stayzilla I had to look up in my mail trial as I couldn’t recall their names – and in the formers’ case I couldn’t figure out the pricing and latter’s case I had to resort to the phone to resolve issues.
Customer service matters – Saavari.com said they’d get back to me and they never did. They had a beautiful website – clean and while my use case was not a clear fit to their standard offerings, phone calls were not returned. Similarly Stayzilla called me back to say that the Taj Gateway room was no longer available – that they’d put me in an another hotel on the same street. To give full credit to them, they constantly followed up but were caught scrambling. The place they finally got me I passed on due to poor reviews on Trip Adivsor. Jet Konnect won over ClearTrip as it was easier to cancel or make changes with them.
This was the first time that I travelled to a new city – let alone a Tier 2/3 town – without seeking direct personal inputs from friends or family and did so at short notice and had a uniformly pleasant experience – despite not speaking a word of Telugu in this instance and carrying minimal cash. Whether web and broadband penetration is where we’d like it to be or not, for businesses the web and mobile have changed how they do business forever.
We’ve all heard the story of the boiled frog. The one that’s so comfortable in a pot of water, that’s being slowly heated, that it cooks to death. Wikipedia claims that the scientific evidence for such a boiled frog scenario is contradictory at best. But the metaphor’s worked well enough for innumerous editorial writers, from the Cold War to climate change. In keeping with this hoary tradition, I’m compelled to warn of an impending doom – my own personal amphibian aquatic tipping point – that is close upon us.
It is one, alas, that is perpetrated, aided, abetted by marketers.
I speak not of Lady Gaga or boy bands (though they are bad enough, I can tell you, as the parent of two teen girls) but of nothing less than the beginning of the end of Indian civilization. And if we fall, can the rest of the world be far behind?
I know that for at least several thousand years, since the start of the Kali Yug, we have been proclaiming the fall of Indian civilization. More recently, the tearing down of the Babri Masjid, the riots in Gujarat and weekly news of the Naxal attacks in middle India seem indicative of an imminent civilizational demise. And I am sure that between the Shiv Sena, the MNS, and the Telengana agitators – along with their lesser known brethren from Assam to Tamil Nadu — various people of dubious motives are busy chipping away at the edifice of what our ancestors have built.
Yet, as an optimist, I have not let any of this even bother me, let alone drag me down.
Not a bit. And here’s why. First, we now actually have an identity of being Indian rather than merely Madrasis or Gujaratis or Thakurs from Ballia! This is in itself worth celebrating. And more than Akbar or the British Raj, it is Bollywood, cricket and Pakistan that have been the primary contributors to the creation of this new pan-Indian identity.
Yes, we attack one another, at times kill a number of our fellow citizens gruesomely and get away with it as well. I’d argue, though, that we are doing this at much lower rates than we have historically.
Of course, the trucks plying our highways continue to kill far more people with far less provocation. We possess a unique ability to be rude to one another while driving or jostling in queues. The need to grease palms for nearly anything may even be growing. Our public spaces are littered with garbage and graffiti. Our parks, such as they are, are encroached on by politicians. Our rivers, despite the reverence we allegedly hold them in, are polluted.
But these are all problems that can be fixed. We still keep our homes clean, we continue to show respect to our elders in private and at times in public. We believe education is important as is saving for the future. We continue to volunteer to help the poor, the needy and the very many who are challenged one way or another. We have a newfound confidence in ourselves, in our identities as Indians. We are, in many ways, irrepressible.
All this had kept me hopeful about our continued growth and prosperity.
The first time I saw six young lasses sitting in a circle at the local mall, each texting or talking to someone who was not in the circle, is when I glimpsed the beginning of the end. Soon it seemed that at no occasion were people, not merely youngsters, ever in the present. Be it at the movies (“Hello, I’m watching My Name is Khan…”), a classical music concert or even at dinner at a restaurant with their family.
Marketers, the same people who have caused the littering of every corner of our nation with the detritus of one rupee plastic sachets, have gotten the water boiling.
I realized it when I saw the invasion of flat panel advertising in every remaining social space. Be it the local Cafe Coffee Day, Chinese or Punjabi restaurant and, oh no, my local hole-in-the-wall tea stall. Finally, even eye contact, which was the only thing left after the cell phone onslaught, has been done away with.
So you have a family of four, the wife on a call with her friend, the boy busy with his iPhone, the girl watching Katrina Kaif slithering across the screen and Dad trying hard not to drool, even as he keeps an eye on his Blackberry.
The out-of-home advertising flatscreen. God help us all.
If I had a dollar for every prospective employee who said he loves what he’s seen and heard at our company but his father/spouse/friends feel more comfortable if he joins ‘Giant Co Ltd’ next door, I’d be a rich man. And every one of those prospects was honest enough to admit that their father/spouse/friends felt far more comfortable with the safety, reputation and BRAND of ‘Giant Co Ltd’.
Brand, the very word seems to connote a variety of images. Advertisements, billboards and neon signs, models and Bollywood stars are what many people associate with the word. If you probe further, you may hear AirTel, Britannia, Disney, Coca-Cola and Pepsi or Sony and Samsung as companies that people think of as brands.
People in the trade, be it marketers or financiers, talk of brand equity, brand loyalty, and brand names. When you talk to entrepreneurs about brands and what it means to them, they, particularly those in the early stages of their business, admit that brand is important and something that they aspire to build one of these days. However, right now they have to run and take care of this cash flow matter or woo that key hire, so they will get back to it when they have more time and when it’s more appropriate!
So what is a brand and how much should entrepreneurs care about it? And when should they care about it? Doesn’t it cost a lot of money to build a brand? Is it a luxury for a struggling start-up? These are a few questions worth considering and answering even as you embark on your business.
Brands, simply put, are what people think they are. In other words, when people associate Amul with butter, Kissan with jam, Disney with TV (if you are an Indian child) or with Mickey (if you are a 40-year-old American) that is what those brands are. Beyond word association, they often denote something specific — what marketers such as Al Ries, co-author of Positioning: The Battle for Your Mind call the brand promise. For instance, among cars BMW promises performance, Mercedes luxury, Toyota reliability, and Volvo safety.
The key point that Al Ries has been making for the better part of three decades is that a brand’s positioning or promise is determined by how it is perceived by the consumer and not what you as the product or service’s maker believe or state it to be. In the simplest sense, as a start-up or an entrepreneur, if you comprehend and internalise this, you are already on the road to building a differentiated brand.
You have already persuaded some friends and a few former colleagues to join your start-up and are now trying to hire a few more key people. “I am quite happy where I am right now. I am not really looking for a change,” is what you’d usually hear from really good people, the kind you’d want to hire for your start-up. One of the key factors in their decision-making will be your brand and what it’s perceived as. At this stage, when you have just started or have not even become operational, it may seem counter-intuitive to talk about your ‘brand’ — don’t be fooled, the day you began dealing with people other than the founders, you began building your brand.
The reality is that your candidate is thinking about the pros and cons of staying at his present job and the alternative opportunities he may have elsewhere . In other words, he is positioning this opportunity against others and the moment he does that, he is associating a brand such as ‘risky’ or ‘unique opportunity’ or ‘great technology’ with your company. If you want to participate in this mental conversation and persuade him to indeed make the leap to your organisation, having clarity about your brand and what it connotes is critical.
The best way to build your brand is to have clarity — namely knowing yourself — as in what does your business stand for, what do you promise your employees, your customers, and other stakeholders. Once you have the clarity, state it and act on it each day. The day you open shop, your brand matters, and if you don’t state it and shape it yourself, the other guys will be they competitors or prospective employees and, most importantly, the spouses of your current employees.
As Anthony J. D’Angelo, creator of The Inspiration Book Series put it: “If you talk the talk, you damn well better walk the walk.” If you thought knowing yourself and stating it succinctly for others was hard, being yourself consistently is harder still. At this point, particularly in the context of start-ups and entrepreneurs, it’s worth pointing out that ‘brand’ is not something people associate with your product alone, but with your company and many times with your employees and you.
Southwest Airlines is one of the best examples of such brand value and perception permeating not merely the flights and on-board service, but also the founder and first CEO Herb Kelleher and all employees of Southwest from gate agents to in-flight staff be they pilots or cabin crew. So if your image is one of love and fun (as it is with Southwest), you had better exhibit it every day and everywhere.
Nearer home, the Tata brand as personified most recently in the Nano announcement or how Ratan Tata himself is perceived or how an entire earlier generation views the Tata Administrative Service, speaks of knowing and being oneself.
Just as it is a good idea to get a friend signed up when you embark on any new and often difficult activity (running three miles a day or yoga), walking your talk as an entrepreneur is easier if you get your team signed up. They are with you every day and will be (much like your spouse) the first to point out when you stray from the path of walking your talk. So if you make that guy who has come to interview with you wait interminably while you finish something, you are not walking your talk of “individuals matter” (if that is your position). Similarly, if you say “Ship it so that we can make the billing and we can fix it afterwards,” you are not walking the talk of “quality at affordable prices”. As any married person will vouch, telling the truth is always the less expensive option (regardless of near-term consequences). Similarly, being true to who you say you are as a business is the best way to building a brand. Who said it would be easy?
Jack Stack, founder and CEO of Springfield ReManufacturing Corp (SRC) in his book A Stake in the Outcome states: “The company is the product.” For an entrepreneur and a start-up, there is no truer statement of their raison d’etre. It is easy to ascribe a brand or positioning to your products or services, but much harder to both conceive of and work on your company itself as the product. Great entrepreneurs, be it Dhirubhai Ambani or Richard Branson, have known this intuitively and Reliance and Virgin are a direct result of this ‘company is the product’ philosophy.
From day one, it is this vision of what your company is (or will be) that you need to sell, starting with your team all the way to your customers and their customers (the reason Intel advertises its products to consumers, who are its customers’ customers). Some of you may feel uncomfortable with the idea of ‘selling’, be it your products, your company or yourself. The lesson you need to draw from good sales people is that selling is less about talking and all about listening!
So listen to what the world is telling you and be consistent and true to yourself, and the brand will take care of itself.
This article was first published in the Business Line print edition dated September 8, 2008
Most people seem to have a reasonable idea of what engineering (design and build stuff), finance (manage the money) or sales (make money by selling stuff) do in a business. Marketing is another story altogether, being confused with sales in the best case or perceived as a money-sucking black hole in the worst. It is likely the most misunderstood part of doing business.
Marketers, in turn, are often perceived by other employees as spending the company’s money on flashy ads or on exhibitions and junkets that involve travel to resorts and fancy meals. The words ‘entertainment expenses’ seem to dance before their eyes when they think of marketing. While some or all of this may be part of marketing, they don’t make us a marketer any more than reading the business pages of a newspaper makes any of us a stockbroker.
So what is marketing and what are marketers supposed to do? And why should you care? Theodore Levitt, the American economist, in his seminal book The Marketing Imagination asserts that “marketing … view(s) the entire business process as consisting of a tightly integrated effort to discover, create, arouse and satisfy customer needs.”
He also makes the distinction: “Selling concerns itself with the tricks and techniques of getting people to exchange their cash for your product. It is not concerned with the values that the exchange is about.”
Even if entrepreneurs agree that marketing is important, they sabotage themselves in a number of ways stemming from not comprehending how best to go about it. The real or often perceived expense of marketing is the most common concern that cash-strapped start-ups have.
When company founders are technologists, there is a belief that superior technology or product performance sells itself. Marketing, I argue, is a critical function for entrepreneurial ventures. It is every employee’s job, starting with the CEO, and is too important to be left to the marketing department alone.
Discovering needs The dictionary definition of the word discover is to “determine the existence, presence or fact of.” Discovering customer needs is rarely as simple as asking them — though that is always a good place to start. And it helps if you begin this even before you start building your product or service.
Once customers state a need or requirement, repeatedly asking the question ‘Why’ helps. When a mother states “I wish I had more time to exercise” or “I wish I could feed my children healthier food,” she may be talking about the lack of household help or her commute time or how much organic food costs. So understanding the core problem to be solved is important, and many a time the customers themselves may be unaware of it till they go through this multiple ‘Why’ questioning. Even when the desired outcome is clearly stated, such as “Increase the gross margins for our digital cameras” or “Shrink our order fulfilment time by 50 per cent and reduce mistakes to one part per million,” asking ‘Why’ ensures you are working on the right problem.
The first job of marketing is to discover the pain points for the target customers and define them as requirements. Once we have a well-defined set of questions (what and why), we can look for the answers (how).
The challenge for entrepreneurs or start-ups is that they usually get started due to a perceived gap in the marketplace such as “Buying tickets for inter-city bus travel should be easier than it is.” Being men (and women) of action, they immediately set out to solve this problem. Of course, once you have a part of or the whole solution and then get it out there in front of people, you find that your product or service is not exactly setting the world on fire. This is why discovery prior to product development is an important piece of your marketing success. In real life, you don’t do discovery only at the beginning, but iteratively at each stage of your product or service’s lifecycle.
Creating and arousing demand The most mystifying aspect of entrepreneurship is that once you have built that better mousetrap, not only is the world not beating its way to your doorstep, it’s not even returning your calls when you try to tell them about your solution. As a good marketer you did your homework and discovered that people found buying inter-city bus tickets painful. So you developed your easy-to-use, Internet-based online bus ticket booking system and yet it’s greeted with a great yawn. Creating and arousing demand, what technically the marketers call demand creation, is a critical marketing step. In a previous article, I noted “Build and they will come” only works in films. It is for marketing to get customers to move from “I have a problem” to “This is a good solution to my problem,” where ideally “this” is your product or service.
Creating and arousing demand will require re-acquainting the customer with the learnings of the discovery phase. Tell your customers, “Adding GPS to your digital camera is a good way to differentiate yourself from the competition and it will allow you to hold your price and hence stop the decline in your gross margins.” This way you state the key problem they have, your solution for the same and how the solution works.
Satisfying the demand The most dangerous stage (and cause of much teeth gnashing for marketers) is the transition from demand creation to fulfilment or satisfying the customer need. Having comprehended the customer’s needs in the discovery phase and evangelised your solution in the demand creation phase, if you don’t execute well in this last phase, your competition is likely to satisfy the customer and enjoy the fruits of your labour.
So having a clear plan to fulfil the demand you’ve created and executing it is key in this last stage of marketing.
Satisfying the demand created rarely ends with product delivery as this only highlights other unmet needs or even the gap between the expectations raised and the reality of your solution. Ensuring customer satisfaction through sustained support and a new iteration of discovery, creation and satisfying is needed. So don’t begrudge your poor marketing guy’s dinner expense — he’s on a tread mill, get on it and support him and sign that darn expense report!
Over the last several years, I have written about startups, entrepreneurship and business in general in the Hindu BizLine and Wall St. Journal. I have compiled these for easy access in the column below.