When Planning for 2024, Focus On the Jobs Your Customers Need to Get Done

Understanding what will motivate a potential customer to buy your products or services is a critical prerequisite to developing an effective marketing strategy and creating compelling marketing communications. As thousands of marketers will attest, this isn't a simple task.

As marketers, we develop customer value propositions and we create content we believe will resonate with our potential buyers. But too often, our marketing programs don't produce the results we expect.

This lackluster performance frequently stems from the methods marketers typically use to define their market(s) and to determine and describe how their products or services will create value for customers.

Most B2B marketers define their market(s) based on a combination of product/service characteristics and the attributes of their potential customers (company size, industry vertical, etc.). 

So, for example, a marketer might define his or her market in these terms:  "We sell manufacturing execution system software to large enterprises that are engaged in both discrete and process manufacturing."

Then, marketers use these definitions to guide the development of their customer value propositions.

The problem is, these conventional approaches to defining markets and identifying how products or services create value don't help marketers pinpoint what actually motivates people to buy. Fortunately, there's a proven way to solve this problem.

Understand What Customers Need to Get Done

The starting point for understanding what will motivate your potential customers to buy is to recognize that people don't buy a product or service because they want the product or service itself. In most cases, what they really want is what the product or service will enable them to accomplish. 

For example, most small business owners don't really want a company brochure, or a direct mail campaign, or, for that matter, a website. But, many will invest in these things because they see them as effective tools for increasing sales.

Theodore Levitt, the legendary professor of marketing at the Harvard Business School, memorably expressed this idea when he often told his students, "People don't want to buy a quarter-inch drill. They want a quarter-inch hole."

In their 2003 book, The Innovator's Solution, Clayton Christensen and co-author Michael Raynor built on Professor Levitt's thinking to describe what is now widely known as the jobs-to-be-done framework (the "JTBD framework"). In 2005, Christensen and co-authors Scott Cook and Taddy Hall further described the importance and value of the JTBD framework in a landmark article published in the Harvard Business Review.

The basic idea of the JTBD framework is that when people identify a "job" they need or want to get done, they look for a product or service they can "hire" to perform the job.

Christensen and his co-authors argued that this is how customers "experience life." Their thought process begins with an awareness that they need or want to get something done, and they seek to hire something or someone to do the job for them.

So, the presence and recognition of a job that needs to get done are what trigger and energize a potential customer's motivation to buy. This makes the job - not product/service features or customer demographics/firmographics - the primary unit of analysis for marketers who hope to develop and execute high-performing marketing strategies and programs.

In the HBR article, Christensen and his co-authors put it this way:

"The marketer's task is therefore to understand what jobs periodically arise in customers' lives for which they might hire products the company could make. If the marketer can understand the job, design a product and associated experiences in purchase and use to do that job, and deliver it in a way that reinforces its intended use, then when customers find themselves needing to get that job done, they will hire that product."

I've previously written about how the JTBD framework can be used to guide the development of marketing content. The point of this post is that the framework can also be a powerful tool for thinking about market definition, market segmentation, and value proposition development during your marketing planning process.

So, as you begin planning for 2024, take enough time to identify the jobs your potential customers are facing that your products or services can perform. This is the real key to understanding what will motivate your potential customers to buy.

Image courtesy of Got Credit (www.gotcredit.com) via Flickr (CC)

How to Judge the Strength of Your Value Propositions

Compelling value propositions are essential for successful marketing. The best way to determine the effectiveness of a proposed value proposition is to test it with real potential customers, but that approach isn't always practical for many B2B companies. This article describes a framework that B2B marketers can use internally to judge the strength of their value propositions.

The textbook definition of a value proposition is ". . . a concise statement of the benefits that a company is delivering to customers who buy its products or services." (Investopedia) A value proposition is a promise you make to potential buyers about the value they will receive by becoming your customer. 

Value propositions are a core component of every company's business and marketing strategy. When you're formulating a business/marketing strategy, there are two questions you must answer very early in the strategy development process.

1. What type(s) of customers will we seek to serve?
2. How will we create/deliver superior value for/to those customers?

How you answer these questions will affect every aspect of your strategy, and the second question requires you to develop and articulate clear value propositions.

There are dozens of value proposition templates available online and in books, and almost as many models or frameworks that describe the components of a value proposition or the process marketers should use to develop value propositions.

Some of these templates, models, and frameworks are useful, but developing compelling value propositions is still a challenging task that entails significant background work and requires a combination of art and science.

The best way to gauge the strength of a proposed value proposition is to test it will real potential buyers. Large B2C companies frequently use this approach. For example, a consumer products company may run different versions of a TV ad in different market areas and monitor the performance of each version. Or, they may test the strength of different value propositions using focus groups.

This approach isn't as practical for many B2B companies because they tend to have fewer potential customers and longer sales cycles, and because B2B buying processes typically involve multiple "buyers."

There is, however, a way for B2B marketers to evaluate the likely effectiveness of a proposed value proposition. The following diagram depicts a basic framework that B2B marketers can use internally to judge the strength of their value propositions.

This diagram shows that the strength of a value proposition results from the interplay of three factors - the needs and priorities of prospective buyers, the strength of your competitors' offerings, and the strength of your company's offering.

The diagram also shows where winning, toss-up, and losing value propositions are typically found in the framework, and the following table compares the attributes of strong, so-so, and weak value propositions.

Winners - Your value propositions will be strong when the attributes of your offering are aligned with the needs and priorities of your prospective buyers and when your offering is superior to your competitors' offerings (relative to buyer needs and priorities).

Losers - Your value propositions will be weak or irrelevant if the attributes of your offering aren't aligned with the needs and priorities of your prospective buyers. They will also be weak if the attributes of your offering are inferior to your competitors' offerings.

Toss-Ups - In a three-circle Venn diagram, the "sweet spot" is usually where all three circles overlap, but that isn't the case here. If your value propositions are aligned with your prospective buyers' needs and priorities, but they focus on attributes of your offering that are just equivalent to what your competitors are offering, you won't have a competitive advantage. You'll win some deals and lose some deals, and whether you win or lose will likely depend on price.

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In some cases, your value propositions will need to include points of parity (the attributes of your offering that are equivalent to what your competitors are offering) as well as points of difference (the attributes of your offering that are superior to what your competitors are offering). Some of those points of parity may be very important to a prospective buyer, so your value propositions need to show that you "break-even" with your competitors on those points.

The bottom line:  Strong value propositions will emphasize points of difference but include points of parity.

Top image courtesy of jonny goldstein via Flickr (CC).

How to Build Compelling Value Propositions for the COVID-19 Recovery

It's no secret that the U.S. economy experienced a traumatic shock as the result of mandatory business closings and stay at home orders that were implemented to stem the spread of COVID-19. In April, retail sales fell 14.7% compared to March, and the unemployment rate also reached 14.7%, the highest rate since the Great Depression of the 1930's.

Recent economic data suggests that the bottom of the COVID-19 recession may have occurred in April. For example, June retail sales were $524.3 billion, up by 7.5% over May, and up by 21.3% over April. And the June unemployment was 11.1%, still at recession levels, but down significantly from the April high.

It's also clear that the pandemic is far from over. During the past few weeks, the number of COVID-19 cases has increased dramatically in a number of states, and in response, several state and local governments have reinstated some mandatory business closings and imposed other restrictions. These actions raise questions about the pace of the economic recovery over the next few months.

The most likely scenario is that the U.S. economy will be "convalescing" through the rest of 2020. It won't make a quick recovery to pre-pandemic health, but it will show continued, if uneven, improvement. Under these circumstances, business conditions in the second half of this year are likely to remain challenging. Revenues will be unpredictable for many companies, and the uncertainty will make business leaders more risk averse than usual.

To win business in this environment, many companies will need to "retool" their customer value proposition(s). The economic repercussions of the pandemic have altered the needs and priorities of many of your existing and potential customers. Therefore, value propositions that were compelling before the pandemic may be less appealing today and for the next several months.

The Basics Haven't Changed

While COVID-19 may require value propositions to be reengineered, it has not changed the attributes that make a value proposition compelling or the process that should be used to develop value propositions that will resonate with prospective buyers. So let's review a few of the fundamental principles of customer value propositions.

The diagram at the beginning of this post depicts the basic value proposition framework. It shows that all value propositions involve the interplay of three factors - the needs and priorities of prospective buyers, the strengths of your competitors' offerings, and the strengths of your company's offerings.

The diagram also shows where winning, toss-up, and losing value propositions are typically found in the framework, and the following table compares the attributes of strong, so-so, and weak value propositions.

Winners - Your strongest value propositions will exist when the strengths of your offering match the high-priority needs of your prospective buyers, and when your offering is clearly superior to the offerings of your competitors (relative to those high-priority needs).

Losers - Your value propositions will be weak if they focus on attributes of your offering that are inferior to the attributes of your competitors' offerings, or if they aren't aligned with the high-priority needs of your prospective buyers. 

Toss-Ups - In a three circle Venn diagram, the "sweet spot" is usually where all three circles overlap. But that isn't the case here. If your value propositions focus on features of your offering that are just equivalent to what your competitors are offering, you won't have a competitive advantage. You will win some deals and lose some deals, and whether you win or lose will likely depend on price.

To develop value propositions that will be compelling during the COVID-19 economic recovery, the most important step is to identify how the pandemic is affecting the business operations of your customers and prospects right now, and how it is likely to impact them over the next few months. 

The next step is to identify the attributes of your offering that meet those immediate needs. And lastly, focus on the attributes of your offering that make them superior to your competitors' offerings at meeting those immediate buyer needs.

The Right Pivots Can Drive Revenue Growth in 2020

The business world now has a new buzzword thanks to the coronavirus - pivot. Until recently, the term pivot was primarily used to describe a major, long-term change in a company's business model or business/marketing strategy. But over the past three months, I've seen a growing number of media articles and blog posts using pivot to describe a wide variety of changes that companies have made in response to the COVID-19 pandemic.

For example, many restaurants that previously offered only dine-in service now offer home delivery. And according to an article at the Parade website, 172 breweries and distilleries in the U.S. had converted at least some of their manufacturing facilities to the production of hand sanitizer as of June 1st.

The economic havoc caused by the COVID-19 pandemic has impacted most B2B companies. During March and April, many were forced to cease operations entirely, and many that were allowed to remain open faced sharply lower revenues.

The good news is, the U.S. economy is now coming back to life. All fifty states have begun the process of reopening their economies, and there are indications that economic activity is already increasing. While most economists are predicting the real GDP will fall significantly in the second quarter, most also believe the economy will begin to grow again in the third quarter. It's not likely, however, that the economy will return to pre-pandemic levels this year, and there's still a great deal of uncertainty about the trajectory of the pandemic and the pace of the recovery over the next 6 to 12 months.

Under these circumstances, business conditions in the second half of 2020 are likely to remain challenging. Revenues will be unpredictable for many companies, and most companies will remain focused on conserving cash. As a result, most business leaders will be even more risk averse than usual.

This does not mean that revenue growth will be off the table for the rest of 2020. The economic recovery will support growth opportunities for companies that tailor their offerings and value propositions to meet immediate customer needs. But to take advantage of these growth opportunities, you will need to "pivot" some aspects of your business.

To execute the right pivot(s) in the right way(s) at the right time(s), you will need to address several issues, but successful pivots always begin with a clear picture of customer needs.

Identify What's Important to Customers Right Now

The first and most important step in determining whether and how to pivot is to identify the most pressing immediate needs of the customers you serve. The question your business and marketing leaders should be asking is:  "What are the biggest challenges my current customers are facing right now that we can potentially solve?"

Focusing on your current customers is important for two reasons:

• First, your existing customers were - presumably at least - happy with your product or service and found your base value proposition appealing before the pandemic hit. So your pivot only  needs to address how the needs and priorities of these customers have changed because of the pandemic's economic impact.
• And second, because of your existing relationship with these customers, they will probably be more willing to talk with you openly and honestly about their immediate needs and challenges. This will enable you to design your pivot based on more reliable information.

Identify the Right Pivot(s)

Once you've identified your customers' most pressing needs and challenges, the next task is to determine what kind of pivot(s) you will need to make in order to meet those needs.

If your existing product or service offering can effectively meet your customers' most pressing needs, it may be sufficient to modify your go-to-market value propositions and marketing messaging so that they are laser focused on the customers' immediate needs.

More often, though, you will find that you need to change your product or service offering in some way to make it a better fit for your customers' immediate needs. Many of the necessary changes are likely to be driven by your customers' need to manage cash flow in the face of unpredictable demand.

The circumstances will vary from company to company, but here are a few examples of the kinds of questions you should be asking:

• Can I remove some non-essential components from my service offering so that I can profitably offer the service at a lower selling price and still provide good value to the customer?
• Can I enable customers to place "smaller" orders for my products on a more frequent basis? If so, this would allow customers to purchase my products on a more just-in-time basis.
• Can I offer customers more favorable payment terms without impairing my working capital?

The balance of 2020 won't be a cake walk for most B2B companies, but those companies that make the right pivots can still achieve above-average revenue growth.

Image courtesy of Ron Mader via Flickr CC.

Six Questions You Must Answer to Create Compelling Value Propositions

Customer value propositions are an essential part of a company's business strategy and the foundation for all of its marketing and sales efforts. Unfortunately, many companies don't devote enough time and energy to defining their customer value propositions, and as a result, their marketing and sales efforts aren't as productive as they could be.

It's difficult to overstate the importance of compelling value propositions. In Playing to Win:  How Strategy Really Works, A.G. Lafley and Roger L. Martin argue that a business strategy is essentially the answers to five interrelated questions, the two most important of which are:

1. Where will you play?
2. How will you win?

Lafley and Martin write, "These two choices, which are tightly bound up with one another, form the very heart of strategy and are the two most critical questions in strategy formulation."

Customer value propositions are the answers to the "how to win" question. As Lafley and Martin put it, "To determine how to win, an organization must decide what will enable it to create unique value and sustainably deliver that value to customers in a way that is distinct from the firm's competitors."

What Makes Customer Value Propositions Weak?

Despite their undeniable importance, many companies don't do a good job of identifying their customer value propositions or developing content resources and sales messaging that articulate those value propositions in a compelling way.

A few years ago, CEB conducted a survey of decision makers in B2B companies and found that only 57% of the "unique benefits" touted by sellers were seen by potential buyers as having enough impact to create a preference for a particular seller.

Over the past 25 years, I've reviewed hundreds of the value propositions used by clients, and what I've consistently found is that weak value propositions fall into three main categories:

1. They are too generic. They don't speak to how value is created for specific types of companies or buyers.
2. They focus on product or service features rather than on the tangible results a customer obtains by using a product or service.
3. The don't include credible supporting evidence.

Not surprisingly, strong B2B value propositions exhibit the opposite characteristics. They describe specific elements of value for specific types of companies and buyers, they focus on business/economic results or outcomes, and they include credible evidence to support their value claims.

How to Develop Compelling Customer Value Propositions

Defining strong customer value propositions comes down to answering six fundamental questions about each major type or category of product or service that you offer:

1. What are all of the significant reasons that people have for purchasing a product or service like mine? What problems or needs motivate the buying decision?
2. What kinds of companies are likely to have the problems or needs that underlie these reasons to buy?
3. Who within the prospect organization is affected by each problem or need? Who has the most to gain if the problem is solved and the most to lose if it isn't?
4. What specific outcomes are these people seeking?
5. What features of my solution will produce these desired outcomes?
6. What will the business/economic benefits be if these desired outcomes are achieved?

Using these six questions to define your customer value propositions will provide the essential foundation for developing effective marketing and sales content and messaging.

Image courtesy of GotCredit via Flickr CC.

Stop Making Lame Excuses for Marketing/Sales Misalignment

In a recent blog post, Dan McDade with PointClear wrote that in "chaotic" organizations, 70%-94% of leads generated by marketing are ignored by sales reps. Dan's statistic pertains to what he considers to be poorly-performing companies, not average firms. Nevertheless, this statistic seemed to be shockingly high, so I decided to look for other recent research regarding sales follow-up on marketing leads.

• An article at Business2Community by Sherry Lamoreaux contained a reference to a survey by CEB in which 49% of surveyed sales reps said they ignored more than half of all marketing-generated leads.
• The 2013 Lead Management Optimization survey by CSO Insights paints a slightly more positive picture. In this study, 46% of respondents said that sales reps actively pursue at least 75% of marketing-generated leads. Unfortunately, 42.6% of respondents indicated that sales reps actively pursue less than 75% of marketing generated leads.

Even if the CSO Insights study provides the most accurate view, it's clear that there's still a significant disconnect between marketing and sales in many companies.

Let me be blunt here. In 2014, successful B2B demand generation requires a coordinated effort by both marketing and sales, and a lack of alignment between marketing and sales is now both intolerable and inexcusable.

Marketing/Sales Misalignment is Intolerable

The lack of marketing/sales alignment is intolerable because it results in waste and significant lost revenue opportunities. As proof, consider the following research findings.

• Companies' inability to align their marketing and sales teams around the right processes and technologies has cost them upwards of 10% or more of their total annual revenues each year. (IDC)
• Companies with highly aligned marketing and sales functions achieved an average of 32% annual revenue growth, while less well-aligned companies saw a 7% decrease in revenues. (Aberdeen Group)
• B2B companies with highly aligned marketing and sales operations achieved 24% faster three-year revenue growth, and 27% faster three-year profit growth. (SiriusDecisions)

Marketing/Sales Misalignment is Inexcusable

The lack of alignment between marketing and sales is inexcusable because the process for creating alignment is well known. The marketing/sales alignment puzzle has four major pieces.

Value Creation - This refers to how you create value for customers. Marketing and sales must be aligned on this issue because it's the foundation of your entire demand generation system. To create alignment, marketing and sales should agree on your core go-to-market value propositions.

Target Market Definition - This includes both the kinds of organizations that will make your best prospects and the identity of the individuals within those organizations who make or influence the decision to purchase your product or service. If marketing and sales use a common target market definition, there will be fewer disagreements about the quality of leads produced by marketing.

Messaging - This refers to the content you use to tell your story to potential buyers. There is often a huge disconnect between marketing and sales when it comes to messaging. Various studies have shown that between 50% and 90% of the content resources produced by marketing are not used by sales and that sales reps spend hours every month creating their own sales materials. These problems can be avoided if marketing and sales agree on the major components of your company's messaging.

Lead Management - In this area, alignment means that marketing and sales have agreed on:

• What constitutes a "sales-ready lead"
• How the hand-off of leads by marketing to sales will be handled
• How sales will follow up with leads supplied by marketing
• When leads will be passed by sales back to marketing for additional nurturing

None of these steps is particularly complex or difficult to implement. The only thing preventing better marketing/sales alignment is the unwillingness of marketing and sales leaders to put aside cultural baggage and take the necessary steps. The time for lame excuses is over.

Four Key Ingredients in the Marketing/Sales Integration Recipe

In November of last year, I published a post here titled It's Time to Integrate Marketing and Sales. It's now the second most popular post at this blog, and it also created quite a stir at LinkedIn. In the Sales and Marketing Alignment group alone, the post had prompted 99 comments as of yesterday.

I was pleasantly surprised by the number of comments that supported the basic idea of integrating marketing and sales. The comments also revealed, however, that there are widely different views about what the "integration" of marketing and sales really means. To maximize the potential of integrating marketing and sales, company leaders must have a clear and detailed picture of what the end result should look like.

In my view, there are four key ingredients in the recipe for marketing and sales integration.

A Unified Go-to-Market Strategy and Plan

An integrated marketing/sales function must be based on a comprehensive go-to-market strategy and plan that has been jointly developed by marketing and sales. For integration purposes, the most important components of the go-to-market strategy/plan are:

• The value propositions that describe how your products and/or services create value for customers
• A definition (description) of the kinds of organizations that constitute your company's target market (an ideal customer profile)
• Profiles (personas) of the types of individuals who make or influence the decision to purchase the kinds of products or services that your company offers
• A description of the messages and content resources that will be used to communicate your value propositions to potential buyers
• A description of the lead stages that your company will use to categorize prospects and the criteria you company will use to qualify prospects. This will include a definition of what constitutes a "sales-ready" lead.

Integrated Demand Generation Processes

An integrated marketing/sales function is also based on a set of demand generation processes that collectively span the entire revenue generation cycle. Some of these processes will be performed exclusively by marketing, and others exclusively by sales. However, several critical demand generation processes, such as lead nurturing and lead qualification, will require the involvement of both marketing and sales. What's important here is the recognition that marketing processes and sales processes are components of a single revenue generation system and that they are often connected and interdependent.

Integrated Technology Systems

To maximize the results from marketing/sales integration, marketers and sales professionals must be working from the same data relating to prospects and customers. Therefore, it's important to integrate the information systems and technology tools used by marketing and sales. The most significant integration will typically involve the company's marketing automation/lead management software and its customer relationship management software.

Unified Leadership and Management

A fully integrated marketing/sales function will be led by a single C-level executive. The title of this executive may be Chief Customer Officer, Chief Revenue Officer, Vice President of Sales and Marketing, or something similar. Whatever title is used, the important point is that one senior executive is responsible for leading all of the company's revenue-generating activities.

Those are my key ingredients for a full integration of marketing and sales. What would you add to or remove from this list?

I'd also like to hear your views about whether fully integrating marketing and sales is always the best course of action. What circumstances make integration critical to success, and what circumstances make another approach the best solution? Please comment to share your views.

Why Improving Performance Doesn't Always Create More Value

In a recent post at the SiriusDecisions blog, Jeff Lash wrote about seeing an advertisement for a cell phone that boasted about the phone's 215 hours of battery life between charges. Mr. Lash noted that on a heavy usage day, he spends at most two to three hours on his phone and at that rate, 215 hours of battery life would last about ten weeks. He thought it was pretty likely that he'd be able to find a convenient power outlet more frequently than once every two and a half months.

Mr. Lash's point was that 215 hours of battery life far exceeded his requirements, and therefore much of that long battery life would provide little value to him.

I've written frequently in this blog about the importance of understanding how your solutions create value for customers. Clear and compelling value propositions are, in fact, the foundation of all effective marketing.

Unfortunately, it's easy for marketers and other business leaders to overestimate the value of their solutions. The problem stems from an implicit belief that improving the performance of a solution automatically increases the value of the solution.

Clayton Christensen addressed this issue in The Innovator's Dilemma. In Christensen's view most established companies in any industry improve their products or services along dimensions of performance that their major customers have historically wanted and valued. What often happens, however, is that the pace of performance improvement exceeds the ability of customers to take advantage of the increased performance. Eventually, a company "overshoots" its market. Prospective customers are happy to accept the higher performance, but they aren't willing to pay more to get it because they can't translate the increased performance into benefits that produce better business results.

This circumstance has several important implications for marketers. Most importantly, it means that marketers should always seek to understand whether and to what extent new features or capabilities will enhance the value of a solution in the eyes of potential buyers.

So, before deciding how to market a "new and improved" version of your solution, answer these questions from a prospective buyer's perspective:

• What performance criteria are most important for my business?
• What levels of performance must a solution provide in order to meet these criteria?
• Are some of the performance criteria more vital or important than others?
• Once "acceptable" levels of performance are met, do higher levels of performance and/or new capabilities create meaningful new value and, if so, how?

Content Marketing Basics for 2013 - Compelling Value Propositions

If you want to implement an effective content marketing program in 2013, the place to start is with your customer value propositions. Value propositions are the cornerstone of your entire demand generation strategy, and they provide the foundation for your content marketing efforts. Most of the content resources you publish should be based on, or derived from, the core value propositions you offer.

Value propositions describe how your products and services create value for customers, and their importance cannot be overstated. The 2012 Lead Generation Benchmark Report by MarketingSherpa found that, on average, companies with clear value propositions enjoy lead generation ROI's that are 117% higher than companies without clear value propositions.

Despite their undeniable importance, many companies don't do a good job of identifying their core value propositions or creating content resources that articulate those value propositions in a compelling way. A recent survey of decision makers in B2B companies conducted by the Corporate Executive Board found that only 57% of the "unique benefits" touted by sellers were seen by potential buyers as having enough impact to create a preference for a particular seller. To put it bluntly, you simply cannot create compelling content without first identifying compelling value propositions.

Over the past two decades, I've reviewed hundreds of the "value propositions" used by clients. What I consistently find is that weak value propositions usually fall into one of three categories.

• They are too generic.
• They focus on product or service features.
• They aren't supported by credible evidence.

Not surprisingly, strong value propositions exhibit the opposite characteristics. They describe specific elements of value, they focus on business/economic results or outcomes, and they are supported by credible evidence.

Identifying your core value propositions comes down to answering six fundamental questions about each major type or category of product or service that you offer.

• What are all of the significant reasons that people have for purchasing a product or service like mine? What problems or needs motivate the buying decision?
• What kinds of organizations are likely to have the problems or needs that underlie these reasons to buy?
• Who within the prospect organization is affected by each problem or need? Who has the most to gain if the problem is solved and the most to lose if it isn't?
• What specific outcomes are these people seeking?
• What features of my solution will produce these desired outcomes?
• What will the economic benefits be if these desired outcomes are achieved?

Using these six questions to identify and describe your core value propositions will provide a solid foundation for your content marketing efforts. They help you identify your target market, and they provide the starting point for developing the buyer personas that I'll discuss in my next post. In addition, the answers to these questions will help identify the topics that your content resources should address.

I recently published a white paper that explains how to develop compelling value propositions. If you'd like a copy of this white paper, send an e-mail to ddodd(at)pointbalance(dot)com.

Read Part 1 of the content marketing series here.

Read Part 3 of the content marketing series here.

Read Part 4 of the content marketing series here.

Why Marketing Myopia Is Still A Problem

In 1960, Theodore Levitt wrote a landmark article for the Harvard Business Review titled “Marketing Myopia.” When it was republished in 2004, HBR editors said the article, “introduced the most influential marketing idea of the past half century.”

Levitt’s central argument was that companies will cease to grow if they define their business too narrowly – in terms of specific products or services rather than in terms of customer needs. In a quintessential passage from the article, Levitt explained the decline of railroads in terms that have become part of the business lexicon:

“The railroads did not stop growing because the need for passenger and freight transportation declined. That grew. The railroads are in trouble today not because that need was filled by others (cars, trucks, airplanes, and even telephones), but because it was not filled by the railroads themselves. They let others take customers away from them because they assumed themselves to be in the railroad business rather than in the transportation business.”

The “disease” that Levitt wrote about is still with us, but now, some marketers are also afflicted with another kind of myopia. This new strain of marketing myopia is characterized by an almost exclusive focus on marketing communications and the technologies that support them. As practiced in many companies today, marketing means marketing communications and not much more.

Marketing communications are certainly important, but marketing also has other responsibilities that are essential for business success.

For more than four decades, the term marketing mix has been used to describe the operational aspects of the marketing function. The term became popular in the 1960’s after Neil H. Borden published an article in the Journal of Advertising Research titled “The Concept of the Marketing Mix.” Borden’s marketing mix included product planning, pricing, branding, distribution channels, personal selling, advertising, promotions, packaging, display, servicing, physical handling, and fact finding and analysis. E. Jerome McCarthy later grouped these ingredients into the four categories that we know today as the 4 P’s of marketing – product, price, place, and promotion

The point of this brief history lesson is that marketing has long had a mandate that is broader than marketing communications (promotion). Companies can suffer when marketing ignores these broader responsibilities because, of all the major business functions, marketing is (or should be) the best suited to relate a company to its external competitive environment.

So, if you’re a marketer, give these ideas some thought:

·        Marketing is about communicating your company’s value propositions, but it must also be about determining what those value propositions will be.

·        Marketing is about communicating the important features and attributes of your company’s products or services, but it must also be about determining what features and attributes your products/services need in order to be attractive to buyers.

·       Marketing is about communicating your company’s price-value equation, but it must also be about determining what your company’s pricing strategy will be.

Marketing communications will always be a critical part of the marketing function. But marketers need to keep the other aspects of marketing in mind in order to avoid a bad case of marketing myopia.

Marketing and Sales Alignment: Putting the Whole Puzzle Together

There's no longer any doubt that a high-performing B2B demand generation system requires a coordinated effort by both marketing and sales. Changes in the attitudes and behaviors of buyers have made it essential for marketing and sales efforts to be tightly integrated.

Most of the discussions about marketing and sales alignment have focused on the lead managment process. In this area, alignment primarily means that marketing and sales have agreed on:

• What constitutes a "sales-ready lead"
• How the "hand-off" of leads by marketing to sales will be handled
• How sales will follow up with the leads supplied by marketing
• When leads will be passed by sales back to marketing for additional nurturing
• How new leads acquired by salespeople (through prospecting) will be handled

Having marketing and sales aligned on a well-designed lead management process is important, but that's not the only place where marketing and sales need to be on the same page. In other words, lead management is only one piece of the marketing-sales alignment puzzle.

There are three other critical pieces of the puzzle - value creation, target market definition, and messaging.

Value Creation

Value creation refers to how you create value for customers. It's critical to have marketing and sales aligned on this issue because it's the foundation for your entire demand generation process. To create alignment, marketing and sales should agree on the core value propositions that you will offer to potential buyers. (For a list of questions that can help you define core value propositions, see this earlier post.)

Target Market Definition

Your target market definition includes both the kinds of organizations that will make your best prospects and the identity of the individuals within those organizations who make or influence the decision to purchase your product or service. Marketing uses this definition to design lead generation campaigns and programs. If marketing and sales use a common target market definition, there will be fewer disagreements concerning the quality of leads produced by marketing.

Messaging

Messaging refers to the content you use to "tell your story" to potential buyers. Messaging is embodied in all kinds of communications vehicles, including traditional marketing collateral documents, white papers, e-books, webinars, and sales presentations. There is often a huge disconnect between marketing and sales when it comes to messaging. Various studies have shown that between 50% and 90% of the collateral materials produced by marketing are not used by sales, and the American Marketing Association has reported that salespeople spend 30 hours per month searching for or creating their own sales materials. These problems can be avoided if marketing and sales agree on the major components of your company's messaging.

The Whole Puzzle Matters

Aligning marketing and sales across all four of these issues is not easy given the culture that exists in many companies. But consider how much better your demand generation would perform if you marketers and salespeople had a common view of:

• How you create value for customers
• What kinds of organizations make your best prospects and who the key players are within those organizations
• How to effectively communicate your value to potential buyers
• How to manage leads effectively throughout the buying process

How to Make Difficult Marketing Questions Easier to Answer

To develop a successful marketing program for your business, you must make some critical decisions, and those decisions require you to answer several difficult questions.

• What kinds of organizations will make your best prospects?
• What individuals in those prospect organizations will be the target audience for your marketing programs?
• What "arguments" will you use in your marketing messages and materials to persuade potential buyers to purchase your products or services?
• How will you demonstrate the return on investment that your products or services will deliver to a prospective customer?
• What marketing channels will you use to communicate with your target audience?

How you answer these questions will define the shape of your marketing program and largely determine how successful your marketing efforts will be.  These questions are never easy to answer, but you can make the job a lot easier if you will first take the time to thoroughly understand and describe how your products or services create value for customers.

If you've ever watched someone install a tile or hardwood floor on a home improvement TV show, you may remember that the installer spends a great deal of time making sure that the first row of tiles or boards is straight and square with the walls of the room.  After the first row is in place, the rest of the installation goes fairly quickly.  That's because as long as the rest of the tiles or boards "fit" with the first row, the whole floor is almost guaranteed to turn out right.

A clear picture of how your products or services create value for buyers is like that first row of floor tiles or boards.  It provides the reference point for the decisions you will make when designing your marketing program.  Understanding how you create value will make it easier to determine who your best prospects are, to identify the individuals you need to market to, and to craft your marketing messages.

To understand and describe all of the significant ways your products or services can create value, you'll need to answer another set of questions.

• What are all of the significant reasons that people have for purchasing a product or service like yours? What problems or needs motivate the buying decision?
• What kinds of organizations are likely to have the problems or needs that underlie these reasons to buy?
• Who within the prospect organization is affected by each problem or need?  Who has the most to gain if the problem is solved and the most to lose if it isn't?
• What specific outcomes are these people seeking?
• What features of your solution will produce these desired outcomes?
• What will the economic benefits be if these desired outcomes are achieved (lower costs, increased revenues, etc.)?

The best tool for collecting and organizing this value information is called a customer value map or a customer value matrix.  We have a customer value matrix template that we use when working with clients on new marketing projects.  If you'd like a copy of this template, send me an e-mail at ddodd(at)pointbalance(dot)com.

B2B Value Propositions That Resonate With Buyers

One of my favorite definitions of value proposition comes from Jill Konrath, author of Selling to Big Companies.  She says that a value proposition is, "a clear statement of the tangible results a customer gets from using your products or services."

Value propositions are a core element of your marketing strategy.  They describe how you create value for customers and, therefore, they are the ultimate source for your marketing content.  In fact, you can't create compelling marketing content until you really understand how you create value for customers.

Despite their undeniable importance, most companies don't do a good job of formulating and communicating compelling value propositions.  A recent survey of decision makers in B2B companies conducted by the Marketing Leadership Council of the Corporate Executive Board found that 86 percent of the "unique benefits" touted by sellers were not seen by potential buyers as having enough impact to create a preference for a particular seller.

In their 2007 book, Value Merchants, James C. Anderson, Nirmalya Kumar, and James A. Narus identified three basic types of B2B value propositions.

All Benefits - Essentially, a list of all the benefits that managers believe their solutions might deliver to target customers.  This type of value proposition requires the least knowledge about specific customers or competitors, but it has one major drawback.  This approach can lead managers to claim advantages for solution features that actually provide little real benefits to target customers.

Favorable Points of Difference - When managers use this type of value proposition, they attempt to differentiate their solution by identifying favorable points of differrence between their solution and the customer's next-best alternative.  While better than an All Benefits vallue proposition, this type of value proposition still has a major drawback.  It can lead managers to assume that all favorable points of difference will be valuable to a prospect, while the reality may be that many points of difference contribute little value to a particular prospect.

Resonating Focus - The third type of value proposition is called Resonating Focus.  Anderson, et. al. say that in a world where potential buyers are extremely busy, sellers must use value propositions that are both compelling and simple.  The basic idea behind a Resonating Focus value proposition is to identify the one or two points of difference (between your solution and your competitor's) that deliver the greatest value to the target customers.

Resonating Focus value propositions dovetail nicely with content marketing.  To begin with, companies that use Resonating Focus value propositions develop customized value propositions for various customer segments.  This is necessary because the elements of value that matter most are likely to vary based on the type of customer involved.

It's also possible to extend the Resonating Focus value proposition concept from customers (organizations) to individual buyers or buyer personas.  And when you develop Resonating Focus value propositions for each of your buyer personas, you will have taken a large step toward identifying the marketing content you need.