Product Focus - The Marketing Challenge
Posted by:
FSPRetail ,
08 December 2011
The principal role of marketing is to increase sales and profitability. Marketing managers use a variety of tools to accomplish this purpose but the aim is singular. It is simple to describe and much less easy to achieve.
Increased sales can come only from two sources – enabling existing customers to spend more or attracting additional, new customers. In most cases, the former, getting more from existing shoppers, is easier than the latter.
Therefore, the first requirement is to know as much as possible about the existing customers – a good checklist is generated by asking, who, what, where, why, when, how often, where else? Establishing this baseline information is vitally important. Fortunately, once described, the customer profile, in the absence of major local shopping developments, remains stable for a number of years.
Budgetary constraints will determine how best, and how quickly, the customer profile can be developed. There are various workable approaches but it is worth taking professional advice before setting out on your own. Research can look simple but when poorly designed or executed, it not only wastes time and money but can produce seriously misleading results.
Many shopping centres have a reasonably good understanding of the profile of their existing customers. What is much less common is any understanding of how well the centre is meeting shopper requirements. What proportion of their spending occurs in your centre? How does that compare with spending in comparable centres?
Only by quantifying this Market Share Gap and measuring its changes, can the effectiveness of marketing be truly measured.
Having agreed a target to reduce the Market Share Gap, it is then possible to develop relevant marketing collateral. Marketing budgets in shopping centres are rarely very generous but in brand marketing, the 70:20:10 rule has been successful. 70% of the budget is spent on tried and trusted channels. 20% is spent on channels used successfully by parallel brands but not previously employed. 10% of the budget is reserved for experimental, new channels.
In this time of rapid change, where 18 months ago QR codes were still in their infancy, experimentation is likely to become increasingly important. With a less than buoyant economic outlook, budgets will need to be more precisely targeted. What is the evidence will you have that your target has been achieved?
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