IS YOUR MARKETING 50 YEARS OUT OF DATE? PROBABLY.

This is an article I wrote recently, highlighting the woeful state of sales and marketing today.

My article on outdated marketingSuccessful marketing is crucial for any business wanting to survive and thrive. But it’s tough out there. Fierce competition, globalisation and commoditisation are just three of the issues any company faces no matter how large or small it might be.

So you’d expect marketing to be leading the way in strategies and processes that address the business challenges of the 21st century head on, wouldn’t you?

Well, you’d be wrong. Marketing’s return on investment continues to fall, with studies in 2014 showing 75% of marketing strategies under-performing. Eight out of ten new products or services being launched fail to make it past six months. Advertising is losing its pulling power. More direct mail is going straight in the waste-paper basket than ever before. Companies are making severe cuts in their non-performing salesforces.

Even the rise of technology-based customer-care approaches, such as the once-hailed customer relationship management systems, call centres and the like, have done little to provide much-needed support to the so-called ‘marketing mix’.

Why is marketing in such a bad place? The answer is that most of its structure today is still based on paradigms and assumptions created as far back as the early 1900s when the world was a very different place.

What’s more, the majority of those marketing foundations were either based on mere opinion or extremely limited understanding about buyer behaviour. Rarely, if ever, were they based on fact. Add to this the current flock of deluded marketers who believe that ‘likes’, ‘tweets’ and ‘clicks’ are equal to marketing ROI, and you have a recipe for marketing disaster.

If it sounds like gloom and doom, it is. And your marketing is undoubtedly suffering as a result.

The impact of neuromarketing

subconscious-brainBut here’s the good news. Fifty years ago, a development in the medical profession called neuroscience paved the way to a much greater understanding of how the brain works. Since that time, the commercial benefits of neuroscience has spawned its own research area of neuromarketing, where consumer decision-making is revealed at a level never before understood.

A variety of technologies are used in studying the brain. There is fMRI (functional magnetic resonance imaging) scanning to track blood flow, showing which parts of the brain are active when making decisions. We can analyse the brain’s electrical activity via EEG tests on the scalp. And we can test the most important parts of a website, brochure or advertisement using eye-tracking equipment.

Flaws in the ‘old’ marketing

Neuromarketing is informed by research, facts and data. That’s in direct contrast to the personal views and resultant Chinese whispers of the traditional marketing approach. Let’s slaughter some of marketing’s sacred cows neuromarketing has shown to be false.

Markeing flaw 1: Features and benefits? They feature very little.Emotional Benefits The old idea of ‘features and benefits’ relied entirely on the assumption that customers are rational decision makers. Yet neuromarketing shows clearly that our everyday purchasing decisions and habits are based on emotion. That’s because the emotional part of the brain is always one step ahead of the logical, rational part in processing information. So while technical details and features have a part to play when informing customers, that is not the basis for deciding which product or service to choose – the emotional connection is. Simply put, people buy on emotion and justify with logic. Yet most marketing collateral, websites and sales strategies focus entirely on the rational, logical aspects of a product or service. Even if emotion is used to gain attention early on, it is quickly supplanted by rational, features and benefits-led messages. Little wonder, then, that most of this type of marketing communication fails miserably.

Marketing flaw 2: You need an ESP, not a USP.

Rosser Reeves
Rosser Reeves

In the 1940s, Rosser Reeves, Chairman of Ted Bates, a New York advertising agency, theorised about why a particular television advertisement was more successful than another. He suggested that it was due to what he called a ‘Unique Selling Proposition’ (USP) contained within the ad. Reeves went on to say, ‘The proposition must be one that the competition either cannot, or does not, offer. It must be unique – either a uniqueness of the brand or a claim not otherwise made in that particular field of advertising.’ This idea was never about brands, businesses or sales strategies, only rival TV adverts. Yet, like most myths about marketing, this one is deceptively bandied around by almost every marketer as though it is absolute fact. The real truth, however, is that there is very little, if anything, that is unique about a product or service anymore. Distinct, perhaps, but not unique. More importantly, knowing that we are emotionally led, an Emotional Selling Proposition – an ESP – is what is required, not a USP, yet few companies know about an ESP, or how to create one. An analysis of 1,400 case studies of successful advertising campaigns in the UK showed that campaigns with purely emotional content performed twice as well as those with only rational content. We shouldn’t be surprised.

Marketing flaw 3: The 4 Ps of marketing – no, make that 6, or 9… In 1953, Neil Borden of Harvard Business School devised the term ‘marketing mix’ to try and describe the contents of any marketing strategy.

Neil Borden
Neil Borden

He came up with around twelve different items covering advertising, promotions and branding to name just three. Some years later, an American marketing professor,

Edmund Jerome McCarthy, reduced Neil’s list to just four main components: product, price, promotion and place, and called them the ‘4Ps of marketing.’

These have been a constant feature of marketing textbooks even now, despite being based only on an opinion. Throughout the decades, more Ps have been added, and at last count there are as many as 20, covering People, Processes, Performance…it seems that scrolling through a dictionary to find any word beginning with P can create a new addition to the original few. The catch-all 4P model was criticised almost from the start for being an ‘inside-out view’ (looking from the company outwards) and led by a product mentality. We now understand through neuromarketing that a different, emotionally-led mix of dynamics influences customer behaviour. Unfortunately, such issues as trust, education, relationships and value don’t begin with an upper-case P. Perhaps that’s why many marketers are ignorant of the essential emotional connection and how to create it.

Marketing flaw 4: Much ‘AIDA’ about nothing. In the early 1900s, an advertising manager by the name of Elmo St Louis wrote a theory on how advertising worked.

Elmo St Louis
Elmo St Louis

He called it AIDA, which stood for Attention, Interest, Desire, Action – the four stages, so he surmised, of how a prospective customer could be persuaded to buy a product. Later, his four-stage concept became five, when an additional ‘C’ standing for Conviction altered his mnemonic to become A-I-D-C-A.

To be fair to Elmo, he didn’t have the benefit of neuromarketing to inform his conclusion as to how people made decisions to buy. Nevertheless, it is quite remarkable that this hopelessly off track idea of selling is still taught and practised today. Neuromarketing has demonstrated that making your mind up about whether or not to purchase a product or service is not a simple ‘I’m interested so I’ll buy’ approach, because the brain doesn’t make decisions in a straightforward linear way. Rather, it gathers information from many different part of its neural networks and processes them in a fast, parallel operation. Most of this, as you’ve probably guessed by now, is rooted in our emotions that underpin rational deliberation too.

Opinions or facts? The choice is yours

When I get called in to help companies sort out their sales, marketing and branding, I am still shocked by how much their marketing strategies are often deeply rooted in the past. Furthermore, branding, as a part of marketing, always seems to have an inevitable focus on logos, colours and typefaces. Social media and other parts of the digital revolution can waste precious marketing time and money on creating awareness and engagement with few financial returns. Boring content spouting features and benefits completely ignores how customers interact with products or services. Bottom line: a total marketing mishmash.

Marketing is not about typography or technology. It’s about psychology. A good definition of marketing (and one that beats the academic explanation of marketing from the Chartered Institute of Marketing ‘…the management process responsible for identifying, anticipating and satisfying customer requirements profitably’) is that it’s about ‘influencing customer behaviour.’ After all,  marketers are constantly trying to change the beliefs, behaviours, and decisions made by those we seek to become loyal customers. We need as much insight as possible into that process.

In 1996, the seeds of that understanding were sown. Today, as a result of neuromarketing and other emerging disciplines such as behavioural economics, we have a wonderful insight into how the brain of the consumer works and how to influence it.

For any business, the choice is clear. Stay fifty years out of date, and very likely out of pocket, using the traditional, outdated, approaches to marketing. Or start to utilise what we now perceive about why and how customers buy – and get a greater return on your marketing investment.

That’s probably something worth thinking about.

PS You can download a copy of the article in pdf format by clicking this link.

 

 

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Brand Doctor: A brief bio.

I’ve spent nearly 40 years in advertising, marketing, design and branding. Starting life as a graphic designer and copywriter, I worked for Top-100 companies. I then progressed to heading up brand consultancies responsible for sales and marketing, branding, corporate identity and advertising for Yellow Pages, Virgin, AVIVA, EMI and British Telecom to name a few.

Throughout the years, I’ve also helped smaller businesses dramatically improve profits through building a powerful brand. (Not-for-profit organisations have seen their donor income increase using my brand approach too.)

I’m also a qualified psychotherapist. How people think and behave is crucial to knowing how to brand a business, and with 15 years of experience in the field of psychology, I'm better equipped than most to deliver brands that connect and engage with customers.

Psychology is a rare ingredient in marketing, but it should really lead the way. My psychotherapy work greatly influences the approach to branding I teach and formed the basis for my international best-selling book Branding Your Business.

‘James gave two consecutive keynotes for the past two years at our annual Indonesian Superbrands Conference. He is a breath of fresh air, bringing clarity and understanding to an audience of 400 senior marketing executives hungry for knowledge of ways to create leading-edge business and branding strategies.

James is now a Member of the Board of Advisors, Most Valued Business Indonesia, an exciting new initiative to recognise brands not just for their revenue, but for their social responsibility.

Whenever James comes to Indonesia, his fans eagerly await the latest from the Brand Doctor – and they are never disappointed. Thanks James – and good luck in all you do.’

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and Most Valued Brands

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