10 questions ...
| Author | Bonaque, Borja |
| Position | The list |
... boards are asking their marketing colleagues - and the answers they should be giving
Directors no longer tolerate sloppy, unprofessional marketing departments that fail to justify the often-substantial sums of money they spend. The following are ten crucial questions that board members are increasingly demanding answers to. Not all of them will be relevant to all markets, but marketers must be able to answer the relevant ones
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Professor Malcolm McDonald is emeritus professor at Cranfield University School of Management and one of the UK's leading authorities on marketing.
1 Do we know and understand our key markets?
* We define our markets in terms of needs satisfied, not the products we sell.
* We map our markets showing product/service flows, volumes/values in total, our shares, and draw critical conclusions for our company.
* We know what the key decision points are. In particular, we understand the "20/80 rule" (that 80 per cent of your profit comes from 20 per cent of your products), as this is where segmentation is done.
2 Do we address real segments in our markets?
* We conduct proper needs-based segmentation rather than relying on a priori nonsense such as socioeconomics (not all "A"s behave the same); demographics (not all 18 to 24-year-old women behave the same); geodemographics (not everyone in the same street behaves the same); and so on.
* We also understand the needs of members of each segment.
3 Do we know what our sources of differentiation are in each of the principal segments in our key target markets?
* We regularly check on the buying motives of segments and compare how well our company performs against our main competitors.
* We act on the strengths and weaknesses that we identify. We ensure that our strengths create value for us and the customer and that they are difficult to copy. We work hard at tackling the weaknesses that are meaningful to the customer.
* We regularly monitor the opportunities and threats by segment to take advantage of the opportunities and to nullify the threats.
4 Do we all agree where we should target our limited resources?
* We prioritise specific segments in each market, having classified them all according to relative potential for growth in profits in each segment over the next three years and according to our company's relative competitive position.
5 Are our objectives for revenue growth and market share realistic?
* For attractive markets (in other words, those...
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