Every year, I would give a talk about Market-Driving Strategies to outstanding graduating student leaders attending the MarkProf’s annual Marketing Leadership Bootcamp.
For application, participants were asked to decode the market creation strategies of a product of their choice, using the Market-Driving Strategies framework, concept, tools and templates introduced by Mansmith and Fielders. Despite being young with practicum as their only work experience, their output is nothing inferior to many marketing practitioners; perhaps, being one of the Top 25 Marketing Management Trainees of the Philippines boosted their confidence.
Let me share some of the lessons about market-driving, market-shaping or market creation often missed by traditional marketers focusing on brand switching tactics, it would be timely for companies to compare these with what they have already planned:
1. Marketing strategies cannot just focus on the marketing mix and positioning of the current market, it is first and foremost about opportunity-seeking.
2. Opportunity-seeking is more about growing the market, not brand switching tactics where the total market size remains the same.
3. When a brand gains market shares, another brand loses, but without category growth, the sales of the channel and retailers remain the same. This is not a win-win situation.
4. Retailers will “tax” manufacturers for their one-way gain, through dozen of charges they can impose (listing fee, product highlight fee, promo fee, etc). Manufacturers must start to understand that just like them, retailer’s growth and return on shelf space (ROSS) is also dependent on how they grow their respective categories.
5. Brands can launch the best advertisements, the best sales promotions, the best of everything and result to a market share change, but the market size may remain the same, unless they focus on the unmet needs of the underserved and unserved markets.
6. Opportunity-seeking entails calculated risk taking. To avoid risks, firms must choose multiple relative large markets with common needs being ignored by current players in order to have economies of scale.
7. Market creation is about understanding key barriers that affect purchase and consumption. Solve the barriers and consumers may have a compelling reason to change their preference in the brand’s favor.
8. Key barriers, irritants, disappointments and annoyances (BIDA) of served markets can be different from the underserved markets and a distinction is needed.
9. Many brands come up with cut-and-paste strategy year-in, year-out. This is because they lack true insights that will inspire them to go beyond low-hanging fruits they see.
10. An insight is about new truths, which means the existing truths must be challenged. This is uncomfortable to many, specially to companies who have been successful in the past.
11. Combining an understanding of BIDA and true insights prepares the marketers to do their ideation that can satisfy unmet needs and their insights.
12. Ideation follows the principle of selectivity, which means that one should come up with as many viable options to satisfy the question on who (target market), what (value proposition), how (business system) and where (channel).
13. Marketers must go beyond value proposition and look at their value chain and business system, which can create a more sustainable differentiation of the brand and of the firm.
14. Being exposed to different industries is a plus factor. Market creation is not about benchmarking for best practices; many times, it is about the next practices, ideas sourced from other industries, other geographical areas, other business models.
15. Long tenure and expertise of senior marketing executives in specific products or industries may even work against new market creation. This is because of the paradigm accumulated all throughout the marketer’s career, working on market-driven strategies of established markets.
16. Unless marketers try thinking like a child again, there will be much impossibility that will discourage them from entering underserved markets. A child can think of new rules, such as teleporting in a chess game.
17. The logic of strategy is to stand out, what better way than to be the successful pioneer? By successful pioneer, the marketer need not be the first mover, but the first who gets it right; there is a big difference between the two.
18. While planning is important, planning for execution is equally imperative. In order to be aligned, leaders must change the metrics to evaluate and reward their marketers. They should stop using the traditional key result areas, which are sales, market shares and profit. They should insist on a fourth — market penetration.
(Thanks to Business World for publishing this article under ‘Market Creation. Visit www.mansmith.net to enroll)
Josiah Go is running his 39th Market-Driving Strategy seminar live via ZOOM on August 21, 22, 23, 24 & 25, 2023, 3 PM to 6 PM (GMT+8). In the Philippines, he is the only one doing this seminar, so don’t miss out! Click this link to learn more.