Tom Shapiro is the author of “Rethinking Your Marketing: 7 Strategies to Unleash Revenue Growth,” and is the founder and C.E.O. of Stratabeat, a branding, design and marketing agency in Greater Boston which has helped develop marketing strategies for Fortune 500 companies such as AT&T and Procter & Gamble. The NCMM recently caught up with Shapiro to talk about how middle market companies can rethink the way they market.
Why should middle market companies rethink their marketing at all?
Shapiro: If you want to grow beyond a billion dollars plus company, you need different strategies to do that. A middle market company typically has a smaller marketing team, and won’t usually rely on outside agencies for marketing. What happens is that if middle market companies get stuck, if they stop growing, they’ll look at a more successful competitor and start copying those tactics, or they might start listening to all the latest hype in the media and start copying those trends even if that makes no sense for them. Or they’ll just tinker around the edges. And all of those strategies typically go nowhere. The company doesn't grow. You’ve got to rethink.
How should a middle market company go about better understanding the value they’re creating for customers?
Shapiro: So many middle market companies are internally focused. They're concerned about explaining every detail about their product or solution, instead of focusing on customer needs. If a customer goes to a middle market company’s website, and it's all about how great the company’s products or services are, how many employees the company has, then who cares? That has nothing to do with solving a customer need.
Get to know your customers, start interviewing them, conduct surveys. Find out what customers are searching for online, what they’re sharing online. When I speak at marketing conferences, I always ask the audience, “How many of your companies have documented personas of their target customer and different customer segments?” Typically it's less than 5%. If you don't know in detail who you're targeting, how can you possibly have a customer-focused approach?
Why should middle market companies rethink the way they understand the psychology of their customers?
Shapiro: Whether it's B2B or B2C really doesn't matter, we’re all human. We all behave in similar ways. It's based on behavioral science and human psychology and neuroscience. Customers make decisions emotionally and then rationalize their decisions afterwards. Neuroscientist Antonio Damasio ran studies on people who had damage to the part of the brain that triggers emotions. What he found was these people couldn't make purchase decisions, they couldn't even make simple decisions like what to have for dinner. To sell your offerings, you need to evoke an emotional response from your customers. That means learning about, and understanding, the psychology that drives them.
How can middle market companies rethink their marketing goals?
Shapiro: The first thing to understand is that you need to document your goals and those documented goals need to be referenced throughout the entire process. You should limit yourself to no more than three goals. If you have ten goals, your marketing team won't know which goals are most important and it spreads them too thin.
As an illustration, when Steve Jobs came back to Apple, they were floundering near bankruptcy. Jobs did the unthinkable, taking Apple from around 30 products down to 4. He combined that focus with the whole psychological approach of evoking emotional responses from customers. He came out with campaigns like, “Think different,” which said nothing about what they were selling but connected with the psychology of Apple customers.
There are so many marketing channels and so many elements of the marketing mix. How can middle market companies decide on the “right” marketing strategy?
Shapiro: They can use data and analytics, but being bold and experimenting are critical. You should look at your marketing as a massive petri dish. If something doesn't work, have the backbone to eliminate it. I’ll give an example. The company Blendtec, which makes kitchen blenders, hired a new V.P. of Marketing, George Wright, who realized he had no marketing budget. The company was very engineering and product focused. Wright was walking through the warehouse and he saw Blendtec founder Tom Dixon chopping up wooden boards in a blender and he said, “Tom, what are you doing?” Tom said, “We're just stress-testing our motors and blades.” Wright had an epiphany.
He said, “We’re going to make videos where we experiment with what our blades can chop up.” So, they started throwing everything imaginable into the blenders: marbles, diamonds, a garden rake. The series was called, “Will It Blend?” and, it generated over 50 million video views because it was so different and outrageous. It wound up increasing Blendtec sales by over 700% within a year and a half. Bold works.
How should middle market companies be rethinking their pricing models to try to maximize their revenues?
Shapiro: Pricing is an overlooked aspect of marketing. There's often a set protocol for pricing in an industry and everyone follows suit. A great way to differentiate without having to change your offering is to simply change your pricing model. Salesforce.com is a great example. Salesforce came into the CRM software market where a typical CRM implementation would be very expensive, say six to seven figures, and could take a year.
Marc Benioff, the founder of Salesforce said, “We are simply going to charge customers $50 or $100 a month, a set fee. It's going to be charged to your credit card automatically and implementation cost is zero. You can start using our software as soon as you sign up.” This was outrageous at the time, but he flipped the industry on its head with this subscription pricing model.
What else would you like to tell middle market leaders about rethinking their marketing?
Shapiro: The middle market companies that struggle are those that tinker around the edges. If you want strong growth, you need to go bold, be decisive, and change things up. By doing so, you've got a much greater opportunity to drive rapid revenue growth.
Listen to "Interview with author & marketing guru Tom Shapiro" on Spreaker.