Elements of a Marketing Strategy – Part 1

marketing strategy

The diagram above demonstrates elements of a marketing strategy. Below, I will explain it in more detail.

Product or service

Although it may sound strange, the first obstacle in creating a marketing strategy is to define what product or service you are going to sell. Sometimes companies are too quick to change or switch their product because they try to please the end customer. This can cause contradicting marketing messages and result in marketing campaigns being ineffective.

USP (Unique Selling Proposition)

USP is the unique benefit resulting from the product or service that makes it stand along against competition. What is that that you can do better than others? For example, the USP of Ryanair is low-cost flights.

Features

Features are what your product or service is comprised of. In order to sell a product, it is not necessary and sometimes even counterproductive to include a large number of features. Rather, the features should match the requirements of the target customer (see below).

Use cases

Writing use cases for your product or service is an excellent exercise that helps you to get ideas for promotion. Here are some examples of use cases for an app for sending appreciation badges within a company:

  • New colleagues can introduce themselves by sending short messages to the team members.
  • Colleagues can congratulate each other on a completed project or on other occasions by sending a badge.
  • The app can be used after meetings or training for sending feedback and thanking the organizer.

Target group

Achieving product-to-market fit is one of the cornerstones of successful marketing. However, not only the product part is important but also defining and selecting your target group.

Segmentation

You can segment both outside and inside your target group. Segmenting the market in general (see market segmentation) orientates you what segments you will target and what not. Once you selected your target group, you will unlikely be homogeneous, so you need to segment further. Typical target group segmentation for a B2B product can include such criteria as:

  • Users vs decision makers
  • Company size
  • State-owned vs privately-owned companies
  • Geographical segmentation (country, location)
  • Field of business

Personas

Personas help you to define in detail who your customers are, to understand what language they speak, what motivates them and drives their decisions. Customer personas are more detailed and granular than segments and may look like this: “Male customers, located in the US, aged 20-30, working as software developers, interested in hacking, having “geek” mentality. Their main focus is not on the career but on improving their skills. They visit hacker blogs and websites, spend a lot of time online and participate in forums and closed communities. Their challenge at work is time pressure, the necessity to learn new skills fast and requirements changes in the course of projects.”

Market

While the target group defines who your customers are, market defines how many there are of them and also how many you can realistically reach.

Size

No matter how good your product fits customer needs or how elaborate your marketing strategy is, without a proper market size your product is not going to scale. Market size can be defined in several ways, e.g. total potential market size (the total number of potential users for your product), total existing market (what share of market is already being covered by the competition), the size of the market you can serve (for example, if your product does not scale very well or because there are strong competitors in the market). Estimating market size will be based both on research and assumption, however, this is an important step in creating marketing concept.

Market segmentation

Here you can look at the existing market (competition, customers) or make assumptions about a market you can create. Creating a new market means that you have to generate the demand by educating potential users about your product or service instead of fighting the competition. Bear in mind that this approach has both advantages and disadvantages: you will not have direct competitors, but at the same time, you may face indirect competition by substitute products (see Part 2 of this post).  It also takes a lot of time and effort to explain to potential customers why they need your product or service, so your sales materials and pitches have to be carefully crafted.

In the second part of this post, I will explain how company image influences your marketing concept, what you can learn from your competitors and why marketing tools are the final step in crafting your marketing strategy.

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Mobile Marketing KPIs: What to Consider

This post gives an overview of essential mobile marketing KPIs that would be considered for a performance dashboard. It also outlines a general framework of how these KPIs relate to each other.

mobile_kpis
Mobile marketing KPIs structure

Conversion funnel is an important part of any performance dashboard. The funnel shows how the user travels through different stages and interacts with the ad and then with the product.  A simple conversion funnel for a mobile marketing display campaign advertising for an app would be:  Impressions-Clicks-Installs-First Interaction, with percentage share between them.

Return KPIs can be measured as monetary values: revenue per user, lifetime user value, etc. However, non-monetary KPIs (number of installs, daily active users, daily active paying users, average session length, etc.) are also important, especially in the cases where monetization is detached from the download (free apps or image campaigns).

Cost KPIs will largely depend on your payment model for the advertising. Possible ways are:

Cost per mille (per thousand impressions)

Cost per click

Cost per install (also possible: cost per lead, cost per download)

Cost per engagement

Cost per revenue or revenue share models

ROI is calculated as a percentage share of return on what has been invested in advertisement, for a product that does not monetize immediately, the ROI is calculated per time period (daily, weekly) in user cohorts.

The framework at the bottom of the picture shows how the KIPs can be adapted to achieve a significant level of preciseness and data consistency.

Timeframe includes both how the KPIs are aggregated (daily, weekly, monthly) and what time periods they cover (past, current or future/trend data).

Segmentation is essential for getting the working data. Making the segments too broad will impact the data consistency negatively and working with micro-segments is mostly too difficult to implement and does not allow to make solid conclusions based the data sample.  As an example, consider segmenting the data by country or region, by traffic channel or by device type.

Sample statistics includes the parameters that analyze the quality of data and how the sample behaves in general. Instead of just aggregating and averaging the data, consider such parameters as median, min. and max. amounts and standard deviation. Besides, look at the size of the segments you work with: which of those have the strongest impact and why? Also, learn to recognize patterns in your timeframe, and how the data fluctuates on a daily, weekly or seasonal basis.

After you have decided on the KPI data you will include for your dashboard and reporting, consider making the data more visual and more structured for the intended users. In one of my next posts, I will cover the issue of data visualization in more detail.

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What is the Turnover of 2000 Likes?

Every marketer has probably asked himself/herself a similar question.

In fact, looking at a Facebook page, what are the actual merits of judgement how successful it is? Do the “likes” necessarily convert into dollars (or any other currency)?

facebook in dollars
The turnover of Facebook likes?

Imagine a product or brand page that currently has 2000 fans/likes.  It seems like a lot of fans and probably means a highly popular product. However, it is better to take a closer look at this number.

The first problem is if these fans actually exists. A recent case study about Facebook advertising points out that almost half of the likes came from unidentified profiles that probably have no real consumers behind them.

I.e. it may be easy to receive a  number of fans by investing into Facebook advertising, however the sad fact is the existence of  numerous cases of spam and fraud on the internet (possibly even whole “click farms”), which decreases the value of advertising campaigns.

Secondly, even if the fans seem to be real people, they might not be on Facebook often  (or their profiles may be outdated), so that your chances of interacting with them are very low. Another extreme is the people who are keen on “liking” everything they see,  so that the number of their liked Facebook pages can be counted in hundreds. In this case, your chances to reach these consumers organically will also be close to zero, since their news feeds are very cluttered.

In addition to that, if a user “liked” the page in order to take part in a Facebook lottery or any other incentive,  he/she may, in fact, have little interest in the product or brand and refuse to interact with the postings.

So the only important parameter that helps to evaluate a Facebook page is the engagement, i.e.  Likes, Comments or  Shares of the posts. Shares are certainly the most helpful type of engagement as the organic reach of the posts increases significantly after the post is shared on the wall of a fan or in a community.

Besides, engagement influences the Edge Rank, which, in turn, determines how often (if at all) your posts will be shown to your fans, so this is  a closed circle.

However, we also need to consider the pure business aspect of social media. Does “liking” a product or commenting positively on something actually involve a purchase?

Here we face the core psychological function of social media, that is image-building and self-defining both externally and internally. When a consumer clicks “like” on a product page, he or she wants to be associated with this product and add it to his or her image.

Whether this association also includes purchasing a product will depend on the total buying costs (that is the price and availability of the product, conditions for use, etc.)  As an example: it is highly unlikely that out of 15,5 million Ferrari fans on Facebook (as of July 2014) everyone or at least a half own a Ferrari.

Social Media may play a significant role in after-sale marketing or brand-building, but the actual purchase motivation has to be supported by promotion (discounts, special offers, testers, etc.).

In summary, the turnover of 2000 likes may be much lower than expected, so when budgeting for Social Media one has to consider the return on investment aspect in the first place.

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