What's New in Marketing - Issue 65, January 2008

Christmas 2008 is coming! It's Never To Early To Start Planning.

Peter Bartram finds out how marketers plan when their business depends on key seasonal dates

Carly Mitchell had a very happy Christmas this year. The sales and marketing director of Best Parties Ever has hit her target of filling 200,000 places at Christmas party venues around the country. As a result, the company will book more than £5 million of revenue.

Mitchell is just one of many marketers who are focused on a single day each year - 25 December - and the weeks leading up to it. If their companies have a bad season, they have a bad year.

Christopher Hood, managing director of Needlefresh, knows that if he doesn't shift 650,000 Christmas trees between mid-November and mid-December, the company won't hit financial targets. This period is also important for Marc Lawn, head of marketing services at soft drink maker Britvic. Twenty percent of the company's £800 million annual sales will come in the four weeks leading up to Christmas day.

The experiences of these and other companies bring home how important it is to ensure that marketing campaigns hit the spot when a firm relies heavily on seasonal sales, be it Christmas, Easter or the summer period. For Mitchell, marketing starts early in the year and comes in two main waves. The first wave focuses on contacting the people in large corporates who are responsible for event organising. "A lot of the corporates are running events all year round and the events team will also be responsible for the company's Christmas parties," explains Mitchell. "I spend a lot of time presenting what we can provide to events managers."

Corporates often book several hundred seats at a time, which is important because each of the party venues can cater for about 1,000 merrymakers each night. But bookings from corporates aren't enough to fill all the seats, so the second wave of marketing starts in May.

"This marketing is designed to hit what I would call the everyday type of clients," Mitchell explains. "These are smaller local businesses, especially those within a reachable radius of the 11 party venues. Best Parties Ever has built a database of 200,000 prospect companies which it mail shots with a brochure. In addition, we organise a two-day leaflet drop to neighbourhood businesses in the areas round each of our venues," Mitchell says. "These leaflets reach firms such as hairdressers, estate agents and banks that won't necessarily be on our database." The campaign is topped off with a £250,000 advertising budget mostly spent on local newspaper wraparounds in September.

For Hood, the marketing problem is not so much persuading shoppers to buy Christmas trees as getting the big retailers such as Asda, Homebase, Marks & Spencer and Tesco, to place their orders early enough. "There is a tendency for retailers in general to wait until the last minute before placing the order," he says. "Unfortunately, Christmas trees are not the sort of crop that you can harvest in five minutes. A lot of our marketing is directed at the retailer to react faster and give us the information we need to supply the trees they want."

A key feature of this B2B marketing effort is a website which enables retailers to gather information on the types of trees available. Traditionally, buyers from the big chains would want to visit growers and take a tour of the plantations to view the quality of the stock. "Now," says Hood, "you can take a virtual tour of our farm on the website. If retailers are looking for particular types of trees or pots, we can guide them to the fields where they are growing."

A consistent pattern with companies that rely heavily on seasonal sales is that planning the marketing push starts months earlier. At Britvic, Lawn started planning for Christmas 2007 in October 2006. "We start by understanding what's going on in the market-place. We will have learnt the lessons from 2005 and we'll be learning from 2006 as it's executed," he says. By March or April 2007, he expects to have finalised the marketing themes for December 2007. "We will be getting feedback on what appears to be the route that will take us closer to the heart of the consumer. Normally, our seasonal theme is, first and foremost, about soft drinks and our second theme is around Christmas itself. We will have a generic overall look by April," he says.

The next task is to liaise with key retailers to find out what their Christmas plans are and how Britvic might cooperate with them for mutual benefit.

As the key selling period approaches, Britvic will get volume forecasts from retailers which will be analysed and translated into production plans.

In the three or four weeks leading up to Christmas, Britvic staff will go out to work closely with retailers to ensure that stock gets onto shelves fast enough to meet customer demand.

Lawn isn't the only manufacturer who needs to get a lot of stock into shops in a short period of time. Andrew Dickson, UK managing director of Vtech, a company which markets educational toys, sees as much as 45% of his company's annual £60 million sales coming in the last three months of the year - mostly in December.

Planning for Christmas sales starts around May. "With our major customers, we will have a forecast and then we will make products available against those forecasts," Dickson says. But it's making sure that shoppers choose his products when they're buying presents that is most important for Dickson.

He concentrates the company's television spend in the second half of the year. "The consideration to purchase - the intent to buy - for our types of products normally happens around September and October but the actual purchase is in November or December. Our objective is to try and pull that purchase forward as much as possible."

Making that happen is a combination of persuading retailers to stock and display the products earlier than normal so that advertising can be pulled forward in the confident knowledge that when shoppers go to buy they'll find what they want on display.

This Christmas, Caroline Gamester hung around 250,000 baubles, 250 miles of fairy lights and 8,000 stars. Gamester is managing director of LDJ Design and Display, which plans decorations in dozens of shopping centres and high streets. This autumn she's been talking to major customers about what they'll want for Christmas 2008. "We often sign up customers for two or three years and this allows us to give a discount because we can buy more competitively."

Gamester joined LDJ from a company that sold school uniforms so she's more clued up than most about seasonal marketing. "You need to be very hot on strategic thinking - especially how you're going to grow the company within the limitations of being a seasonal business. You also need spot-on people around you to implement the plans. After all, Christmas isn't a date you can miss."

The feature was first published in The Marketer, December 2006

In for the long haul

How do you ensure that your marketing strategy is implemented successfully and taken seriously at board level? Martin Croft explores the challenges.

Making it real

Creating a marketing strategy is only the first step: once it has been constructed, it must then be rolled out across the company or organisation, while other external 'stakeholders' - distributors or retailers, for example - may also need to be briefed and brought on board.

Unfortunately, it is at this point that many marketing directors will find themselves beating their heads against a series of brick walls, particularly if they are working within a business to business (B2B) focused company. While most major consumer brand owning companies have accepted that marketing has a very real and valuable function, many B2B companies have yet to make that particular cognitive leap.

Too many marketers working in B2B have to overcome at worst prejudice and at best inertia before they start to tackle their real targets, the people who actually buy and use the products or services their organisation is trying to sell them.

Marketing's value

Danny Turnbull is managing director of specialist B2B marketing agency Cicero. The agency recently conducted a major research project amongst B2B marketers, which was published as 'B2B Marketing Insight 2007'. As Turnbull says, "the results are chastening, for marketers at least". More than a third of the respondents said that their bosses saw marketing as a cost, not as a value contributor. And when it came to how marketing was regarded within their companies, the only department that marketers felt was held in lower esteem than marketing was human resources. Finance was considered to hold the whip hand by the vast majority of Cicero's survey respondents. "It's hardly in keeping with the idea that marketing should be at the core of the organisation," Turnbull says wryly.

The survey highlighted that many organisations have a low opinion of the marketing industry, and that many of its exponents are unqualified. Unfortunately, as Turnbull points out, the fact that only half the marketers who responded actually have a marketing qualification could be seen as evidence to support that viewpoint.

Marketers in B2B companies are also struggling because 75% of them

- of the ones who answered Cicero's survey - have dual responsibility. As Turnbull observes, "They're only part-time marketers. Often, the other job they hold down will be a sales role of some sort, as marketing is often seen in B2B circles as an adjunct to the sales function."

Three quarters of respondents said they thought existing courses were biased towards B2C marketing, while more than half of the companies in the report have no budget for marketing training. Less than half of the marketers who provided information for the report are members of any of the marketing trade bodies.

If the marketers who provided answers to Cicero's questions are anything to go by, then most B2B companies see marketing's value as lying in lead generation for the sales force and in gaining positive media coverage and related public relations issues. Turnbull laments: "Long-term brand building is at the bottom of the companies' agendas."

What's in store

Yet the B2B marketing industry is huge. The report estimates that expenditure on B2B marketing in the UK during 2005 was £9.8bn, and 90% of those who were contacted for it said that they expect their marketing budget to either stay the same or increase in the next two years; 52% said they had seen an increase in the previous two years. According to this survey, the number of people with marketing as part of their job function within B2B was 176,000. If you add in those people who have both a B2B and a B2C function, then the number climbs to 272,000 - a very sizeable sector.

However, B2B marketing faces a major recruitment problem, with respondents saying they are finding it increasingly difficult to find good staff. Only 40% of B2B marketers in the report started out as marketers: the rest switched from other jobs.

Some experts argue that the way to get other parts of the organisation to take marketing more seriously and to buy in to the marketing strategy is to involve representatives of those departments in the formulation of the marketing plan right from the start. Others, however, disagree.

The plan

Peter Thomas is marketing and communications director of Accenture. He argues that bringing in other parts of the company before the marketing plan is fully-fledged would make the process too long and drawn out. Instead, he says, "I will go to the leadership team at the back end of the fiscal year to check that the path I'm going down is relevant to next year's planning and to the core business strategy."

Then, he says, you need to "socialise the plan" - communicate it to the other employees and get senior executives and team leaders on board, through formal presentations. The purpose of this formal part of the process is to communicate the plan to "identified champions around the organisation". For a service-based organisation, Thomas stresses, it is these key senior executives who are "the engagement mechanism" - even if they are not marketers, they embody the brand.

Geoff Chapman is head of Europe, Middle East and Africa marketing for Thomson Prometric. Chapman says: "The secret for getting buy-in from others outside the marketing department is to work the relationships even when you don't need them." In Chapman's opinion, "Marketing is not just about building a pipeline to market, but also about motivating others to act as ambassadors, or even a sales force, for you. This means not just cooperating with other departments internally, but also with external partners in the chain."

He also believes that marketers are prone to cutting themselves off from the rest of their organisation, and may suffer for that flaw. Conversely, he argues, "The marketer who thinks outside his own 'silo' is the one who will derive the most benefit for his brand, by understanding, and helping others to see, what works best in the interests of all parties - not just his own."

Don't overdo it

But the worst thing that any B2B marketer can do is to try and market the marketing function in an overt fashion. Jaakko Alanko is managing director of McCann Erickson Business Communications, the specialist B2B agency. He believes that attitudes to marketing within any organisation are down to two factors: "What is the authority of marketing within the company, and what is the authority of the marketing director?"

Alanko continues: "If marketing is appreciated for all the right reasons, then you shouldn't have to 'sell' your marketing strategy. If the business is customer-oriented and communications-oriented, then the company should fall in with the strategy naturally."

But, he warns, "don't try to 'sell' the marketing strategy if marketing has a lousy name within the organisation."

In conclusion, he argues: "If the corporate culture does not accept the value of marketing, there is no point trying to market marketing internally. You can only 'sell' it indirectly, by demonstrating that it has a real value." For example, prove that marketing is not just about being able to charge a premium price for a product, but that it also builds customer loyalty and repeat purchase. By doing that, Alanko believes, marketers can "begin to prove the value of marketing by showing how it plays a part in the business development of the whole company, rather than letting people carry on seeing it as the fluffy, unimportant stuff at the end of the line. Marketing is the enterprise. Break down the barriers around your function and evangelise people in other parts of the organisation".

This point is echoed by many other experts. As Chapman says: "Often, even at the largest organisations, B2B marketers do not have large teams, so they themselves must become standard-bearers, facing outwards towards every customer touch point from distributor networks to helpdesk."

Martin Croft is a freelance journalist specialising in all aspects of the marketing profession. He writes regularly for Marketing Week and many other national tittles. He can be contacted at: Martincroft@btinternet.com. This story was first published in The Marketer, March 2007.

Doing The Marketing Plan

Robert Craven looks at why a marketing plan is an essential tool for any business and gives some advice on how to put one together that ensures people buy from you rather than your competitors!'

The writing of a plan helps you to focus on what it is that you are really trying to achieve and it also enables you to make your mistakes on paper - you can look at the plan and decide if it will really get you to where you want to go.

To be honest, the marketing plan is just plain common sense, but in the world of business everyone seems to make everything so complicated that they quite literally lose the plot.

The biggest pitfalls to avoid when drawing up the plans are:

Listening to friends and family
Being unrealistic
Not doing the proper research
Not testing ideas before going for the big launch

At the heart of the marketing plan is the fundamental marketing question, 'Why should people bother to buy from you when they can buy from the competition?'. If you can't answer this question then you are probably in trouble!

For me a marketing plan needs to answer the following questions:

Who is the product for?
What is their hurt, problem, or issue?
Why do they buy the product or service?
Why should they buy it from you? What makes you different from the competition?
What are you trying to achieve? Targets, objective, numbers ... How will you know you've achieved it?
What is your budget in order to achieve these targets (in terms of time and money) and in what timescale?
What weapons will you choose to make this happen? Adverts, viral marketing, adwords, word-of-mouth, PR, web campaign ...
How will you test, measure and review your results?

At the heart of the plan would be a 100-word mini-executive summary that condenses the whole plan into one concentrated paragraph eg:

Our product is aimed at the MDs of growing businesses ...
Who have hit a glass ceiling in business growth
They need outside support, advice and direction
They buy from us because (unlike our competitors) we have actually been there and done it ourselves (=guaranteed results)
We will sell x contracts at £y (average) in the next six months and spend £z on the campaign (including time costs)
Key weapons will be: newsletter, PR, small-scale seminars, briefings and advertising words
Activity/results review on the first of each month

To be even more daring, you should be able to sum up the whole business (and marketing plan) in 25 words. After all if you haven't got that type of clarity about what you trying to do then how on earth do you expect your potential customers to pick it up? By osmosis? E.g.;

MDs ... fast-growth businesses ... feel pains of growth ... need us ... we've been there and done it ... can show them how to do the same = more profit for them

Everyone in the business needs to understand and be able to buy into the marketing plan - it is probably the most important document in the business. After all, the success of the whole business rides on the success of the marketing plan. No customers = no business.

So, before you even attempt the marketing plan, you need to be clear about what it is that you stand for!

What do you stand for?

As Seth Godin says, 'If you can't explain your position in less than eight words then you don't have a position!'. So what do you stand for? Eg

'challenging, honest business advice free of BS'.

People always think that marketing is expensive but in real terms it is not. The most 'expensive' part of marketing is all the thinking required before you take action. Note how choosing your weapons comes down at point number six, after you've done all the tough thinking.

And what are we trying to create here?

Well, you are trying to create a systematised process that pretty much guarantees success. If you've tested all the weapons then you will know what returns you will get on your investment ... You will know how much it costs to acquire one additional customer and you will know how much a typical customer is worth to you (their life-time value) ... it's all in the sums. This is 'Bright Marketing' at its best or maybe I mean 'Inevitable Marketing' because the results are inevitable, predictable and reliable. Who said marketing is all guesswork?

Robert Craven is the author of 'Bright Marketing - Why Should People Bother to Buy From You?' And MD of consultancy The Directors'.

Risky Business

Omar Mahmoud and Vinay Ahuja look at the broad spectrum of forecasting - from weather to life expectancy - to see what responsible marketers can learn

Ever stood at the supermarket checkout on a Saturday and discovered the other queue always moves faster? Welcome to the dilemma of accurate forecasting. You can take all sorts of factors into account - how many shoppers in the queue, number of items in their trolley, even the gender and age of the checkout assistant - and still get it wrong. You can forecast just about anything but it is a tricky business.

Forecasting touches every aspect of our lives - economic, social and psychological. Economic forecasts, consumer confidence surveys and analysts' estimates provide steady fodder for a hungry business world and financial media. Some people won't leave home without the weatherman's advice, their mood fluctuating with prognosis.

Yet for all its omnipresence, forecasting is difficult. Some see it as little more than crystal-ball gazing or reading tea leaves. It is as much science as it is art - a skill honed and polished by both experience and failure. Even the forecasting industry's early development in the USA at the start of the twentieth century is tinged with irony. The Great Depression - which it failed to foresee - set it back many years.

Despite modern technological development, market researchers face just as many challenges today - not least regarding their 'predictive' ability. Market researchers should look beyond their own industry, and adapt practices and principles from wider domains, to find a fresh approach. This can help identify new solutions often found in close parallels from other fields. The film industry, fashion, politics, weather predictions, military industry, crime prevention - and even relationships between men and women - all rely on forecasting.

What you can learn from weather predictions

Market researchers can learn much from weather forecasting, e.g. forecasting should be a dynamic process of estimation, checking and correction; forecasts should be presented in a range, not a single number (think of min and max temperatures); and forecasts should be communicated in a way that is understandable and useful to the end user as different users have different needs (e.g. marketing, sales and finance).

Most natural disasters cannot be prevented. But the human and material costs can be dramatically reduced through reliable forecasting and adequate preparation. The objective of disaster forecasting is not disaster prevention, but risk assessment and effective disaster management. Business disasters seem to exhibit many parallels with natural disasters.

Managers are often taken by surprise by competitive reactions, PR campaigns, government regulations, economic changes and other extraneous factors. Bad news seems to travel much faster than good news in most organisations. More importantly, early signals often lead to no immediate action owing to the absence of adequate reaction systems or contingency plans. Product failures in the long term have their roots in early signals that were deliberately or unconsciously ignored.

Working with uncertainty

While there are many things that we can at least attempt to forecast, one area defies analysis - human relationships, particularly one between a man and a woman. The parallels for business are the many situations that are uncertain rather than risky. In risky situations, the probability of different outcomes is understood but the outcome is not known (we don't know how the dice will turn, but we know that the probability of any single number showing face up on a typical dice is 1/6). In uncertain situations, the probability itself is not even known.

When you deal with uncertainty not risk, work with scenarios. Change the organisation's mindset from "how can we know what will happen?" to "how can we deal with what we cannot know?"

Forecasting is beset with hurdles. The one lesson that can be drawn from history is the need for humility. One of the key reasons for experts' failure to accurately forecast is overconfidence. Beyond a certain point, more information leads to more confidence but not more accuracy. If you can't improve your own personal forecasting, try the supermarket midweek rather than Saturday to avoid the checkout queue.

This article is a summary of a paper presented by Omar Mahmoud and Vinay Ahuja of Proctor & Gamble at the ESOMAR Congress 2006 (www.esomar.org). ESOMAR is a global organisation committed to enabling better research and was first published in The Marketer in December 2006.