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Creating a Dialogue with the Customer

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Anthony Bamford shares his thoughts in the first of a series of articles for WhichPLM. Anthony (MBA MRICS MIWFM MCMI) is a senior interim manager and consultant specialising in strategic management as well as transformation and change.

I was recently reading Rob Walker’s, I’m with the Brand – which has aged remarkably well for a book now just over ten years old with the subtitle, The secret dialogue between what we buy and who we are. The classic marketing mixes, frameworks and tools taught on MBA and marketing courses remain the standard starting point for engaging with consumers in principle. However, achieving “stickiness” is an essential objective in modern commerce and this can be created and lost more easily in today’s seemingly e-commerce dominated world.

The important word there is seemingly, since so much phone and tablet interaction is essentially a utility. Effective brands interact with the ‘who we are’ of Rob Walker’s subtitle and a small number of companies seem to be achieving that success particularly well. Organisations as diverse as Unilever, Patagonia and Tesla have focused on aspects of the triple bottom line to achieve marketing and positioning success hand in hand with commercial benefits. The triple bottom line of profit, planet and people (or financial, environmental and social) has become an essential factor for companies creating a positive distinction. Take EFI Optitex’s earlier paper addressing this issue for fashion.

The fundamental principle for gaining new customers and engaging them is through the primary sense of sight on screens with the support of sound. Perhaps surprisingly this reflects the approach of mediaeval traders and shop keepers who displayed their wares on tables at the front of shops, which doubled up as shutters at night – something that can still be seen her in the UK, in Swaffham, Suffolk. Despite being over eight hundred years old, this approach had the benefit of utilising a customer’s sense of touch and smell in addition to sight, which is perhaps why we still shop as a modern recreational activity. Luxury brands have now engaged more strongly with electronic channels having had these central concerns. As virtual reality and the immersive experience becomes more mainstream and more effective these senses and associated technologies are likely to become an essential differentiator.

Research into social media and its effects on marketing continue to develop. Given my background in property, articles such as Rigby on Digital-Physical mashups [2014] attract my attention. A range of business areas are used as examples including Nike and Burberry. The benefit of such observations a few years on is that if they remain relevant they can be used as a focal point for reviewing strategy and principles. A more fundamental challenge is whether marketing has changed sufficiently to adapt to, and meet, the new environment, which is addressed at length in the preceding edition of HBR.

A useful tool to assist market positioning and identification is perceptual mapping. A theoretical example is given below to show how this may be used. Like many business tools much of the use of a formal tool like this comes from clarifying comparative positions and their relationships rather than the actual specific accuracy of a given position. Indeed, taking the views of a range of stakeholders and customers may actually emphasise the ambiguity of your own company’s position or that of competitors. This is where the importance of the strategic need for customer intimacy is at its most pronounced.

The other two business strategies for 2019 highlighted at NRF are usefully illustrated by this simple example, showing the potential importance of product leadership and also operational excellence. Together these three strategies can clearly have a compounding effect over time, a bit like interest on cash savings, so that the effectiveness of the operator becomes stronger and stronger over time. Nowhere is this more ably demonstrated than in the example of Amazon, where the metaphor of a giant flywheel gathering momentum continuously as a business model is often used.

It is interesting to note Brian Cornell’s (Target CEO) comment at NRF that 85% of transactions are still in store. It is extremely likely that the US overall has a much greater retail footprint to population than the UK. Certainly Fortune Magazine, in looking at Simon Properties, notes that the ratio of shopping malls in the US to population is five times that of the UK. This means that long-term strategic change is inevitable in this area, suggesting that the balance between “bricks and clicks” towards the latter is likely to change over the long term.

In some quarters there is an emphasis on shopping as an experience, and the physical arrangements of newcomers such as Bonobos seems to confirm this. The use of data from actual stores can be relatively robust. By contrast, how strong is the advertising on social media? This is difficult to be certain about considering that an ad view is not the same as an ad reading. Is there an argument here that social media data provides numbers and that in itself is an easy end? If that is true then it is like the man searching for his car keys under the street lamp although he did not drop them there, because the data provides the illumination of the street and it feels as if we have something concrete, when we objectively have not.

So, to return to the original point, creating a dialogue with who we are, as markets become ever more sophisticated and segments become increasingly difficult to engage all the channels and tools at our disposal will continue to have a place in marketing and relationship building with our customers. To use this in an overarching way effectively Porter’s five forces are useful as a driver. Perhaps in this complex age the force of substitution should be considered carefully. Every company displaying on a screen or shopfront still wants and needs an eyeball to see it and to register it. As possibly the greatest management expert of the 20th century, Peter Drucker, said, the first purpose of a business is to attract a customer.

Lydia Hanson Lydia Hanson has been part of the WhichPLM team for over six years now. She has a creative and media background, and is responsible for maintaining and updating our website content, liaising with advertisers, working on special projects like the Annual Review, and more.Joining mid-2013 as our Online Editor, she has since become WhichPLM’s Editor. In addition to taking on writing and interviewing responsibilities, Lydia has also become the primary point of contact for news, events, features and other aspects of our ever-growing online content library and tools.