DiscoverBusiness & Economics

Fast-Track Your Business

By

Synopsis

Marketing Performance Management pioneer and expert Laura Patterson takes a new approach to business marketing in Fast-Track Your Business: A Customer-Centric Approach to Accelerate Market Growth. The new book helps readers apply the proven Circle of Traction framework used in the VisionEdge Marketing practices to help companies accelerate organic growth.

Growth doesn't just occur - growth takes the right culture, processes and discipline. Most importantly, growth takes intent and deliberate focused action. Growth is a result of solving customer problems at the right time with the right solutions and a story that resonates with the market.

CHAPTER 1

UPSTREAM MARKETING

THE PATH TO LONG-TERM

ORGANIC GROWTH

Because we strongly believe companies need to be customer-centric,

a topic we’ll delve more deeply into, the wheel begins with insights

based on customer, market, and competitive intelligence. These

insights help businesses decide where to place their best and extend

their victories, as well as what to protect or jettison. Armed with these

decisions, organizations can determine what they need to accomplish

to declare success. These outcomes are what enable organizations to

achieve their financial targets.

Once outcomes are defined ideally in customer-centric terms—where

your customers rather than your product are at the core of your

business—you can craft strategies, innovate, and position solutions

that will address customer needs, create customer value, and achieve

customer success within the market segments where you can best compete.

These first few spokes of the wheel fall squarely in what we refer

to as upstream Marketing.

In his book, Profitable Growth is Everyone’s Business, Dr. Ram Chara,

who has taught at Boston University, Northwestern University, and

Harvard’s Business School, explains the difference between upstream

and downstream Marketing. Upstream Marketing, Dr. Chara says,

refers to “the strategic process of identifying and fulfilling customer

16 Fast-Track Your Business

needs.” He posits that developing clear customer segments, along with

analyzing how the customer uses the product or service and what

competitive advantage will be required to acquire the customer, are the

focus of upstream Marketing.

Dr. Chara defines downstream Marketing as efforts such as advertising,

promotion, brand building, and other forms of communication

and engagement, including PR, events, and content. He proposes

that the purpose of these efforts is to motivate customers to adopt

existing products and services. Perhaps this helps clarify the difference.

Downstream Marketing supports your company’s value proposition,

while upstream Marketing defines your company’s value proposition.

Downstream Marketing delivers programs to support product adoption.

Upstream Marketing directs the innovation process to ensure

long-term sustainable growth.

Upstream includes everything from deciding which markets and

customers to pursue, what method is needed, and where and when to

pursue to what offers and messaging to use. Upstream Marketing requires

a longer-term investment and keen focus on performance management.

It also requires delving into a different level of data—gaining

deep customer insights and competitive intelligence by investing in

research; understanding the principles of segmentation, positioning,

and differentiation; and distilling this into a strategy and plan for

growth that is aligned to the business. If you’re looking for long-term

organic growth—which requires innovation, category ownership, and

customer lifetime value to build a business that lasts—you need to

invest in the upstream.

Upstream Capability Requirements

Upstream Marketing is what earns Marketing the capital “M.”

(Did you read “Why and When to Capitalize Marketing” in the

Upstream Marketing 17

Introduction?) Marketing organizations that earn the capital have four

distinct capabilities:

1. They understand the needs and wants of the market and

customers. I remember a mentor years ago telling me “it is

better to be an aspirin than a vitamin.” Upstream Marketing

aims to solve headaches and know which headaches go with

which market segments. This requires conducting formal and

informal research—the focus of our next chapter. Research

starts with a hypothesis or educated guess. A hypothesis

typically takes the form of a question that surfaces as a result

of observation, e.g., we’re not seeing the adoption rate of our

product or service as we anticipated, so what do we need to

address to improve—feature set, messaging, delivery, etc.?

Which one of these will have the greatest impact on the rate?

You might even have an initial theory, such as you may believe

an additional function or capability will improve the rate of

adoption. The only way to verify your guesses is to conduct

experiments, analyze your data, and draw conclusions from

it. This approach can be used for nearly every aspect of

Marketing, such as a hypothesis that customers prefer a particular

medium for learning about your products or a specific

option for getting help when they’re having trouble solving

a problem. Being able to frame the question takes collecting

data—talk with prospects; attend industry events; and read,

read, and read some more (industry articles, analyst reports,

experts’ blogs, etc.). We live in a dynamic world where needs

change. For example, Kodak never evolved to embrace digital

photography. Blockbuster (and all video rental stores) couldn’t

compete with on-demand options such as Netflix. Or consider

the Toys ‘R Us stores closing as they tried unsuccessfully to

compete with online and big-box stores. Your research needs

to be ongoing so you can zig and zag with the market. It’s the

only way to avoid the fate of these failed brands.

18 Fast-Track Your Business

2. They gather and validate the market requirements to

create innovation—differentiated solutions, features, and

benefits that will resonate with buyers. What is the minimal

feature set your offer needs to ease the headache? Of course,

everything about your offer matters to you. The key is to focus

on what matters to your customers. Focus is paramount.

Drill down on the one or two most important differentiated

benefits. Note the word “benefits”—upstream Marketing

speaks from benefits, not features. Features are your evidence.

Consider employing a new product development (NPD)

process, such as Stage-Gate, as part of this process. It prepares

and implements a launch plan that will entice customers

to purchase. The launch plan should be prepared well in

advance of the launch and is just as necessary as any of the

main features of the new product. We tackle this capability

in Chapters 5 and 6, which focus on the all-important wheel

element of Innovation & Strategy.

3. They determine the personas of buyers and approach segmentation

beyond the traditional methods of demographics.

This capability takes more than monitoring social media

platforms to develop personas. Conversations with buyers are

your best source for personas. This means Marketing must

engage directly with customers—ideally in person. This step

isn’t about pitching; it’s about listening to customers and

learning about their problems, challenges, aspirations, etc. Pay

close attention to the words they use. Their language needs to

become your language. This is the focus of Chapter 7, which

addresses the Segmentation & Positioning element.

4. They recognize that Marketing must be agile and facilitate

agility. The market research company Forrester defines business

agility as “the quality that allows an enterprise to embrace

market and operational changes as a matter of routine.”

Upstream Marketing 19

Achieving agility depends on operational and performance

excellence—which are addressed in the final chapters—and it

requires building the infrastructure and activating processes,

systems, and tools. The benefit of doing this at any organization

is that it helps you increase the execution speed of your

business.

Upstream and Downstream Coexist

Clearly, you need both upstream and downstream Marketing, and a

way to pivot from one to the other. Routes-to-Market (RTM) and your

Operational Plan become the transitional spokes between the two.

Execution is all about the downstream, with measures, metrics, and

Key Performance Indicators (KPIs) derived from the outcomes, strategies,

and plans. Downstream is all about the execution. Downstream

Marketing suits the world we operate in: sales NOW. It plays to the

call for fast ROI. It is about speed and financial management. The

downside is that without being grounded to the upstream, the downstream

Marketing budget is always at risk.

As the plan is executed and performance data captured, an organization

can assess whether to stay or adjust course and what additional

insights are needed to stay or accelerate the growth trajectory. Thus,

the wheel continues to spin—upstream Marketing building the momentum

for its downstream counterpart.

Achieving Organic Growth via Marketing

We hope the wheel helps you understand the importance and power

of upstream Marketing to the growth process. We truly believe

Marketing should take the lead for successfully achieving organic

growth. While corporate leaders need to drive the organic growth

initiative, Marketing plays a defining and major role. Identifying

20 Fast-Track Your Business

markets and customers to pursue falls squarely in Marketing’s domain.

It is Marketing that can provide the insight and guidance to answer

questions such as whether the opportunity present is to grow share of

wallet among existing customers by offering more ancillary products

or developing a new offering to penetrate a new market and attract

new customers.

Value-creating marketers see themselves in the business of creating

new benefits for current customers, finding new customers for existing

products, and driving innovations that will keep their business ahead

of the competition.

As the pressure for companies to improve organic growth increases,

Marketing is in the ideal position to step up and take the lead by

developing and orchestrating a disciplined process for selecting the

best organic growth initiatives. The Circle of Traction is one tool.

Ultimately, however, Marketing is going to need a way to identify

and select the best options for organic growth. A useful approach is

to begin with a realistic assessment of the gap(s) between the goals

for growth and current rate of growth based on current strategy plus

the projects already in the portfolio of growth initiatives. Will the

current sources of growth close the gap? If the answer is no, you can

put the Circle of Traction in motion. It’s designed to help you focus on

answering these important questions:

• What do you need to know about your markets, customers,

and competitors that will help you close the gap?

• Can you close the gap by penetrating deeper into your

current customer base or market?

• Can you do this with your existing product/service portfolio?

• Do you need to innovate or go into new markets? How

real is the opportunity? In what time frame? What is your

Upstream Marketing 21

likelihood of success and how much is the opportunity

worth?

• Do you have the market’s permission to grow this way?

How you answer these questions will help you define your priorities

and how success will be determined. These two things serve as the

basis to establishing your business outcomes and the corresponding

strategies you will need to develop and deploy.

About the author

Laura Patterson is the author of three previous business books and known for her practical, no-nonsense approach to proving and improving the value of Marketing. Today she is at the helm of VisionEdge Marketing, recognized as one of the pioneers in the Marketing Performance Management discipline. view profile

Published on February 12, 2020

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Genre: Business & Economics

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