Marketing Strategy

The key to a clear marketing strategy is understanding that marketing is not a department, it is the central function of your entire organization. The most common error in marketing is mistaking tactics for strategy.

“Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.”  — – Sun Tzu (Chinese General, circa 500 BC)

To CEOs and executives who think tactically, the following statements may come as a surprise. Despite what your VP of Sales thinks, sales is a marketing tactic. Despite what your outsourced web development consultants think, unless you’re Amazon, you do not have a “web strategy”; your website is a marketing tactic. Despite what your CTO or VP of Development thinks, product management and functionality is a marketing tactic.

The problem is that the word “tactic” has taken on an inferior connotation to the word “strategy.” It is a compliment to call someone a strategist, even when it would be more accurate to say they are a brilliant tactician. To say someone is “tactically focused” is often a polite way of saying “not management material.” In reality, both strategy and tactics are important to any organization and the differences in the words are more about chronology. Strategy is long-term while tactics are the who, what and when of the strategic plan. Strategic planning is more deliberate and happens less frequently than tactical execution, which should be viewed as a giant laboratory for the experimentation that will guide your company’s evolution.

This confusion of strategy and tactics has two unfortunate results. First, some companies who are either more comfortable in the tactical realm (or those who discount the importance of strategic marketing elements like brand and differentiation) stumble blindly through their markets believing they have a plan that will carry them to success. They work in a data-free, intuitive environment, believing that since they have an aggressive sales team, crack engineers and a flashy website that their marketing work is done. That is not to undervalue the importance of intuition and those flashes of tactical brilliance that spring up from all directions. But without a marketing strategy, you lack a touchstone with which to guide your efforts and measure your results. Many an executive team trades high-fives when they’ve tripled the value of their company – even when they could have seen 15 times growth with a more focused and targeted vision. Results, of course, matter; however, addiction to short term results can lead to strategies that cripple in the long-run.

Many software companies are so addicted to traditional license revenue that they are forced out of competing in the emerging “software as service” model. Many payments and transaction companies are so hooked on the rogue MLS agents that they fail to find leverage in new channels such as VARs and web companies.

The second unfortunate result of confusing tactics for strategy is that you may have too many cooks in the kitchen. The last thing you need on your executive team is five people coming up with their own “strategies” for fear of being labeled “tactical.” Like your ideals and your mission, your marketing strategy should serve as a touchstone for the decisions made in the entire organization.

Channel Development

For some time now, product features and innovation have failed to lead to sustainable competitive advantage. Is a Dell computer significantly better than a Gateway? How is it that Honda has been imitating Harley Davidson for years – with better technology – and yet fails to gain market? When a commodity business such as payment processing attempts to differentiate itself through new product offerings, how long is it before a mega-competitor like First Data or Paymentech starts adding gift and loyalty transactions or new integrated platforms to their own well-funded initiatives?

When you study what differentiates today’s dominant companies from the wannabes in their industries, it becomes apparent that go-to-market choices have a more dramatic impact on sustainable growth and profitability than product features. It isn’t about what to sell; it’s about how you sell it.

Successful companies, no matter their product, share one characteristic: successful channel marketing. With the expansion of technology into every market, companies have more choices than ever for new channels. The Internet, call centers, CRM databases, global expansion and supply-chain disintermediation have created a new source of competitive advantage: channel innovation. This new channel imperative is about one thing — connecting your products and services with customers in the way they want to connect to you.

Yet, such riches in channel options often result in channel confusion. Each channel has its own set of advantages, limitations and trade-offs. The Internet has a low cost per transaction, but the low cost of switching prevents long-term relationships from developing in business-to-business sales. Reseller channels can significantly increase your sales footprint, but they take you one step further away from your end users. Companies who go to market with a single channel limit their sales performance, increase their risk and are at a severe disadvantage to the channel gorillas in their industry. On the other hand, companies who successfully integrate multiple channels into their mix can respond nimbly to changing market conditions and better match products to customers needs.

There are of course successful product companies. But when you look behind the highly-touted feature innovations you will find a successful channel strategy. Behind every iPod are retailers, direct marketers, internet channels and a crowd of music publishers jumping into Apple’s thriving channels. While channel-focused companies often have large internal marketing departments and expertise, most successful product companies have found outside expertise to manage all aspects of their channel strategies.

Our program of Channel Development follow a customer-centric model:

• Discover how your customers want to buy from you
• Develop new channels and hone existing channels to reach your niche markets
• Integrate all channels to eliminate conflicts and create a holistic customer experience
• Measure results and feed winning channels while cutting losing channels
• Create integrated marketing and sales campaigns that invigorate all of your channel efforts

Proven Experience

Boston Turner’s experience spans over 15 years of hands-on experience in the industries and practices we serve. Our professionals have worked with executive leaders in technology, enterprise software, payments, e-commerce, distribution and education.

Our founder, Matthew Turner, made a career of managing hyper-growth companies before starting the BOSTON TURNER Group. As the Chief Marketing Officer of Mercury Payment Systems, Turner tripled both the reseller channel (to over 1,200 resellers) and revenue (from $17 to $54m) and in doing so increased the value of the company from $20m to $120m according to a valuation study by CitiGroup. Turner previously led marketing for the distribution unit of Infor Global Solutions, NxTrend Technology (as part of a team that grew company valuation from $15m to $83m in four years) and an educational subsidiary of the Washington Post Company (where he raised sales closing rates from 14% to 55%). Turner is sought as a speaker for his expertise in lead generation, channel sales, and direct response marketing. He holds a B.A. in economics from California State University, San Bernardino, and is a special interest group coordinator for American Mensa, Ltd.