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Get Ready for 2007
February 01, 2006
Where the b-to-b landscape will be most challenging.
By Mary Donato
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In order to manage marketing priorities, you need to look ahead—not just a few months ahead, but at least a year—and preferably further down the road. Here's some help with your future-gazing: Every two years, the Institute for the Study of Business Markets (ISBM) at the Smeal College, Penn State University, surveys a panel of business-to-business marketing executives and academic researchers to ask them what will be the most important critical challenges facing business marketers over the next two to three years. ISBM tracks what these leaders feel are the capabilities needed to successfully compete in the future—in this case, the year 2007. The top three priorities on marketing leaders' minds are:
1. UNDERSTANDING CUSTOMER NEEDS, MARKET SEGMENTS, AND THE DRIVERS OF CUSTOMER VALUE
Marketers want to gain more knowledge about underlying motivations of customers. As one panelist stated, "The assumption that we know how firms make decisions is often false." Companies are also realizing that the art of nurturing relationships is in many cases a lost art.
2. COMPETING GLOBALLY
This priority is gaining steam. As one leader stated, "…China is realizing that economies of scale will only go so far, and is moving beyond reinventing how manufacturing is done—and turning attention toward marketing." China and India are more than an "emerging new economy." Together they will cause the nature of business markets to change.
3. HAVING THE RIGHT TALENT (WITH GOOD QUANTITATIVE SKILLS)
Put bluntly, business marketers need "some real math and analysis skills. Quantitative stuff, not fluff," said a marketing manager, apparently frustrated by superficial number crunching. Said another: "Many marketing folks are 'marcom' strong and stay clear of business analysis tools."
What are the implications for your company? There are many, but let me briefly highlight three:
• GAIN A DEEPER CUSTOMER UNDERSTANDING
Learn more about your customers and those of your competitors. Benchmark what other firms are doing to gain a deep understanding of their clients' motivational drivers. In addition, focus on demonstrating delivered value and documenting it. Your challenge—and that of all business marketers—is convincing customers that your products and services will deliver, and at an acceptable price.
• GAIN GLOBAL FLUENCY
If yours is a global organization, spend time learning about the impact that China and India are having on your business. Talk to other firms and see how global competition is changing the fabric of their marketing approach.
• INVEST IN TALENT
Quickly find innovative and skilled marketers who go beyond just marcom expertise. The labor shortage will continue to tighten. Years ago, 76 million baby boomers entered the workplace. They started companies, which created jobs, and only 50 million "baby busters" are available to fill them. The healthy economy is also to blame for the coming shortage; what you have are fewer people to fill more demanding jobs. According to Ralph Oliva, executive director of ISBM, "the string has run out on the managerial fantasy that companies can continue cutting marketing budgets and magically keep achieving more with less."
And a final thought: Don't stop getting better. Today's markets require innovation. Pushing the envelope takes guts, but the same old thing won't produce growth in today's markets.
Mary Donato, President, Applied Principles, and Associate Director of the Institute for the Study of Business Markets at Penn State.
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