The market in which companies operate today is characterized by an increased consumer with complex and changing needs and hyper-competition. This last concept should not suggest a situation in which competitors are more numerous than in the past but of a market characterized by intense and fast competitive actions. Competitors must move quickly to build their advantages and affect their opponents.
The competitive escalation appears as a succession of ever closer waves over time, made of first increasing, then stable and then decreasing profits, deriving from exploiting a temporary competitive advantage. Here is the difference: competitive advantages are no longer measured in years but in months compared to the past. In this, technology, as the force of creative destruction, has its decisive role.
Therefore, the company that wants to stay on the wave’s crest must continually renew itself, always looking for a new competitive advantage capable of surprising its competitors, even when it means questioning the status quo, i.e. its current competitive advantage. It is a difficult task, especially for large organizations, because it means destroying what has been created in the past with the hope of generating new value. In this complex market situation, companies increasingly assign a greater role to marketing than in the past. Among the reasons:
Marketing Has A Complete View Of The Company
Those who manage this functional area should have a broader understanding of the company business than finance, operations, product, sales or IT. The reason is that the duties of the Chief Marketing Officer include understanding the market, the competition (offers and companies), partners, and current and potential customers. This 360-degree view is essential for making the most prudent choices or following the most consistent hypotheses with the corporate strategy.
Think about the launch of the Sony Reader. It was the first e-book reader launched in 2004, but, despite having cutting-edge technology, it could not stop Amazon’s advance. What went wrong? The company focused on the product, failing the go-to-market strategy. He initially chose to sell the object in electronic chains and not in bookstores. But above all, he hadn’t thought of building an ecosystem of partners that would allow the buyer to have a catalog of books to choose from;
Marketing Is The Function Closest To The Customer And The Market
The increased consumer, at the center of the company’s thoughts, requires continuous listening and constant assistance. The goal is to move from “hidden persuasion” to involving the customer in the value creation process. Or at least aim to anticipate and satisfy his needs di lei, building a lasting relationship that seeks to maximize the Customer’s Lifetime Value (the accumulated value of the customer over time).
It is important not to limit listening to the customers of the product but always to have active sensors that make it possible to identify the new cultural trends that are going through society. Intercepting weak signals can be vital for identifying new business or communication opportunities ahead of competitors;
Marketing Has The Questions
The amount of data produced daily by people and businesses is exploding. Generally, the IT department can collect and extract all the data it wants, but it is often unable to ask the right questions. These questions guide research and the design of algorithms useful for extracting value from data. And the questions arise from reasoning on hypotheses, supported by a knowledge of market dynamics and business characteristics that the marketer masters.
But it will hardly be possible to gain insights into profits based on impromptu interactions between IT and marketing. Instead, it is necessary to develop a relationship of collaboration that allows a close and continuous comparison in search of phenomena and relationships that are not immediately visible;
Marketing Can Drive Disruption
Building competitive advantage can no longer be left to the product function because people are looking for experiences. Whoever designs a product tends to be completely immersed in functional aspects without knowing market variables. So it is marketing that has the qualifications to take the lead in supply disruption, obviously coordinating the efforts of all departments. Think about what happened to the Fire Phone, the smartphone launched by Amazon in 2014.
At the time, his biggest worry was being able to skip the intermediation of the Apple App Store in the sale of his products. He thought of a proprietary smartphone to facilitate purchases on his ecommerce store. It filled it with useless features (like the 3D display that moved according to the user’s gaze) and priced it like the iPhone, thinking it would trick people into considering it a replacement product. It was a resounding failure because people didn’t need to buy such an expensive smartphone to shop on Amazon;
Marketing Can Be An Engine Of Growth
In recent years, CMOs have come under pressure because, more and more frequently, they are invested with a new responsibility, that of contributing directly to company revenues or, at least, of concentrating on activities that can be measured in terms of contribution. To grow. New labels have also sprung up. For example, Coca-Cola 2017 has a Chief Growth Officer who oversees the corporate marketing and relationship strategies with retailers but, above all, must ensure that the brand value is transformed into revenue and margin growth. Of profit.
This new concept of CMO has both positive and negative sides. Surely it is right to expect that marketing activities are correctly measured, given that today it is possible thanks to digital technologies. At the same time, however, excessive pressure on revenue targets could stimulate short-sighted marketing, which focuses on short-term performance and little on broader corporate objectives.
Also Read: AFFILIATE MARKETING: WHAT ARE THE BENEFITS?