I’m sure you’ve heard of the 4 P’s of Marketing: Price, Promotion, Place, Product. And you may have heard of the 7 P’s: Proper Prior Planning Prevents Piss Poor Performance. So if the 5th P isn’t Piss, what is it?
On the 13th March I attended the Growth Facility’s National Business Summit in Sydney. They had some good speakers who brought disparate ideas together and showed real insight. One of those was Rick Kash. Kash introduced something that I had long suspected – that we have moved from a demand led world to a supply led world. By this he meant that rather than consumers having to hunt for products to solve a problem (demanding a solution) there were many of products that could solve the problem (large supply of solutions). Further the introduction of the internet gives consumers even more power: they can research their problem, find out about multiple solutions (from strangers rather than sales people), evaluate the results and once a solution has been found search for the lowest price provider. The power has shifted from the supplier to the consumer. Or has it?
That’s where Precision Marketing (the 5th P is Precision) comes in: first establish the “Demand Landscape”, group the customer demands in pools (Demand Pools), establish the profit and size of each pool then align the company to chase those Demand Pools with the highest profit potential.
Kash uses an example of dog food. Traditionally divided into wet food, dry food, drinks, etc. this can be divided into Pools depending upon the relationship of the dog with the customer (i.e. the person with the money): dog as a child, dog as a pet, dog as a worker, etc. The size of each Pool can be determined along with the desirability of the customer to pay for the product (i.e. a customer would not buy “dog worker” food for a dog who is considered one of the family even if it was the same). Now the dog food company can precisely align their products with the customer and increase their sales (and profit margins) by targeting the most profitable pools.
So there is Precision Marketing in a nut shell. How are you going to use it to improve your sales and profitability? Can’t work it out? Give me a call or drop me an email.
[First published on Meteorical.Com on 6-May-14.]