Many new General Managers will look forward to planning for their next financial year with some trepidation.
We all are facing situations where:
– The plan is going to call for substantial growth (in sales and profit contribution), even if last year this wasn’t achieved.
– Yet the investment budget won’t be larger. The amount of time your brands are ‘on air’ has shrunk over the years as more money has gone to in-store activity (largely price promotions), and the media budget has been spread more thinly across more media options as various digital ‘new media’ were added to the mix.
– More than half of sales occur on-deal, hardly anyone pays the normal price anymore for our brands.
– There is the suspicion that the normal price is too high (given the amount sold on promotion) and so sometimes consumers pause and break habits to look at other brands, that aren’t ours.
– The brand has more variants (flavours, sizes) than ever before. This was justified on the basis of appealing to new and or different consumers, and winning more shelf space (but the brand has no more shelf space than it had some years ago, probably less; not that this is carefully measured/tracked so its only a supposition). Handling and production costs are consequently higher, and it’s suspected there are more stock-outs of the main variants as we struggle to forecast demand with so many skus.
Even for large, successful, profitable brands this situation looks bleak. It seems very hard to see where substantial growth is going to come from with talk of the next recession and GDP flat or growing anaemically.
All, this makes general managers and their marketers more open to consultants selling “golden or silver bullets”. In marketing terms these cures usually speak about restoring brand equity and differentiation, getting consumers to fall in love with the brand again, talk about focused investment, targeted investment, building loyalty etc. Some fall for these options, hoping for at least a temporary win that they can put on their CV.
So how can management get their business out of this situation? How can we realistically put a plan in place that has a reasonable chance of delivering growth?
This is an introduction into a series of posts on the flaws of generally received marketing theories and an insight into a data-backed new approach to marketing and business growth. As I said, backed by objective research, not just what the ad agency suggests you do, or what you read in marketing columns (like these).
A warning, though, this isn’t a golden bullet, while I can describe WHAT should be done, I can’t describe HOW YOU should implement these ideas. But lets go on a journey.