By Leon Gettler, Talking Business >>
MARKETING has changed completely because of the internet and the old ‘marketing funnel’ is no more, according to Lyndall Spooner, the founder and director of Sydney-based consultancy and advisory firm Fifth Dimension.
Ms Spooner said customers now have many more choices, so companies can no longer rely on the strength of their brand – and the companies that are the most challenged are the ones with the established business model.
She said the traditional marketing funnel, which was developed in 1898, has been completely disrupted by technology.
“Companies need to rethink where they are, how they talk and how they can connect with consumers,” Ms Spooner told Talking Business. “They need to be thinking not just about broad marketing strategies.
“They need to think about the product or the purchase journey and they need to work out how they can get involved in that purchase journey.
“That becomes very difficult for companies that are used to living off the fact that they’ve got a big market share and they’re one of the top brands known in the market. They think their saliency is what’s going to get them into that consideration set when the reality is today, consumers can go online.
“No matter what we want, we can Google it and a whole lot of brands can come up that we’ve never ever heard of before, and it’s highly likely a consumer is going to consider those brands and potentially choose those brands if they’re better for their needs.”
CONSUMERS BECOME MORE SPECIFIC
Ms Spooner said when consumers are going through the purchase process, and looking at the brands, they are very specific in what they want – which means companies need to make sure they have a good offer, something that is compelling and stands up to whatever the competition has come out with.
“The second thing is you need to be present where the consumer is going to look for this information which is increasingly online,” Ms Spooner said.
“Twenty to 30 years ago when we were looking for brands, a lot of our decisions were really dictated by who we walked past, so it was all about physical presence. But today, it’s about having a very strong digital presence and a compelling offer,” she said.
Ms Spooner said it meant companies need to be there in various outlets, and not just social media.
CREATING ‘TRUSTED ADVISORS’
Companies should also rely on what she called ‘trusted advisors’.
For example, Fifth Dimension does a lot of work with the health insurance fund HCF. When consumers are looking to make important decisions in complex areas like health insurance or superannuation, they reach out to third party sources. This means companies offering complex offers need to have relationships with third parties to be seen as a recommended brand by a number of different agencies.
Ms Spooner said this was particularly important in such areas as financial services where the consumer faces some risk entering that relationship. Hence the growth of mortgage brokers as an industry.
MORE COMPETITIVE OFFERINGS
For companies, this means going down the path where their offering is more competitive.
“So 20 years ago, you’d win a customer because you’re the bank on the high street,” Ms Spooner said.
“On the digital street, where people are looking now, any brand is within reach, so if you want to be recommended through a third party, you actually have to have a good compelling proposition.
“You just can’t avoid that today. So whether someone is going to go through a third party, or use social media, and where they are able to compare products very easily, they want something to stand up to say this is a good offer,” Ms Spooner said.
“And it doesn’t necessarily have to be the cheapest offer, but it’s the offer that will best meet their needs and ideally fits their budget.”
Ms Spooner said it means companies now need a network of marketing channels to reach their consumers.
“You can’t really rely on single channels,” she said. “You can’t really rely on your mass brand strategy any more.
“You really need to find out where your consumers are going in their decision process.”
Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness.