Although companies have adopted modern Marketing concepts starting in the 1950′ there are still a lot of myths surrounding the discipline.
Below are five common marketing misconceptions I come across very frequently in discussions with people in leadership roles.
Great Products Don’t Require Marketing
During my marketing career I dealt with great manufacturing companies with very poor marketing. Their products are any marketer’s dream: great quality, innovative design, and clearly differentiated features.
These companies are usually run by people with engineering background who think that if you offer a great product people will just buy it. They invest all resources into product research and development and allocate no funds to communicating why their product is superior.
Unfortunately for these companies today’s consumer is overloaded with information, much of it being advertising. Many great product ideas die in their infancy because of failure to communicate properly. Even the greatest products have to break through the “noise” and be discovered, felt, tested and purchased.
The role of Marketing is to bring a particular product to the consumer’s attention. Having a great product makes Marketing’s job easier, but it doesn’t replace it.
Lowering Price By a Certain Percentage Leads To Proportional Increase In Sales
When faced with a decline in sales, many are tempted to lower the prices in hope for a quick rebound. The thinking is that this initiative will boost sales to a level that will make up for the loss in profits.
In real life sales decline can rarely be blamed solely on price (despite what your Sales team tell you). Price is just one component one’s purchase decision. Quality, availability, brand status, and warranty are also very important.
For these reasons, a 20% price reduction will not result in 20% more sales. Unless you compete in a price-driven category there is rarely a linear relationship between price and sales level.
So before you give up margin find out what’s really important to your customers: you might be surprised to find out that “lower prices” is not the most common answer.
Marketing is Advertising
This one is a classic. Many outsiders perceive marketing as being all about creating promo flyers, websites and other creative to promote a product and service. For some reason, the two terms have become synonyms.
It is true that advertising is the visible, palpable output of the marketing function. The creative work is something anybody can see, analyze, judge and comment on. Just look at the passionate discussions each logo redesign generates.
In reality Marketing is one of the most complex functions in any organization. Its impact on business is far reaching: developing new products, performing market research, selecting the appropriate distribution channel, and setting up pricing, to name just a few areas of involvement.
Companies that view Marketing’s role as simply advertising create a disconnect between customer expectations and what the company is actually delivering (the product). Successful marketing is a combination of a great product offering and simple and effective advertising.
Marketing’s Objective Is To Generate New Business
I read so many job ads for a Marketing position that were in fact Sales related. Yes, Marketing is supposed to generate new business, directly or indirectly (by providing the right tools to the Sales team).
But as importantly, Marketing’s role is to make existing customers coming back for more, that is making customers loyal to the brand. Brand loyalty is much more profitable in the long term as loyal customers are more cost effective to please and service.
Many businesses are so focused on attracting new customers that they tend to neglect (or even abandon) existing ones.
Phone and cable companies are the perfect example: they always offer huge discounts to new subscribers, while long term clients who already paid thousands of dollars in subscriptions are faced with price increases and poor customer service.
New business is always good but don’t forget who’s paying the bills.
Classic Marketing Communication Tools Are Dying
The internet is filled with advice on how companies should abandon traditional communication methods and make a total switch to digital. Apparently TV and print ads, billboards, trade shows are dying and not worth considering in the overall communication strategy.
In real life, the best marketing communication strategy uses a mix of offline and online tactics to reach the target audience. While it’s true that more money is shifting towards digital, printed catalogs and flyers are still required in many business environments.
A well-crafted and memorable TV ad is still a very effective tool to generate awareness. In 2013 the average cost of a 30-second Super Bowl ad was $4 million. No CEO would ever approve such a budget without taking ROI into account.
I think it is every marketer’s responsibility to educate non-specialists about what Marketing is really about. That will eliminate a lot of confusion, frustration and unrealistic expectations.