Strategies in a customer-driven market
How people and businesses make buying decisions has changed profoundly in the past few years, but marketing thinking has yet to catch up. Marketers have less ability to shape brand perceptions and drive customer behavior with traditional marketing tools, so managers need to focus on what influences customer decisions today. They need to develop more effective marketing strategies in order to reach customers who already have access to most of the information they need.
What influences buying decisions?
For years, experience has shown that the three main drivers of buying are personal preferences, marketing messages, and the influence of others. With the enormous increase in product information — such as online reviews, expert opinions, price-comparison apps, and information from social media networks — the influence of “others” has overtaken both preferences and marketing as the principal driver of B2C and B2B purchases. So, if marketing messages have less sway in the decision-making process, how can companies work to influence customers to choose their brands, and how do they design communication strategies in this new environment?
Branding, loyalty, and positioning are increasingly irrelevant
Traditionally, marketers have relied on three main drivers of customer buying decisions: branding, loyalty, and positioning. Customers previously tended to attribute the same quality judgements to new products based on the quality of previous products by the same brand, so marketers used brand messages over time to continue to drive home the reputation of their products. With access to early reviews and information from early adopters of new products, customers now base their decisions more and more on reported quality of the current product, without regard to older products from the same brand.
As a result, in today’s market, your brand is only as good as your current product. Product loyalty and loyalty to particular sales reps is also a thing of the past, as it’s become a less-risky proposition to buy from a different company or rep than you’ve bought from before. Similarly, marketers can no longer drive perceptions of their products through positioning statements and taglines, when online reviewers may find other aspects of a product more relevant to them and dismiss those qualities of your products you were trying to highlight through positioning. Branding, loyalty, and positioning may become even less important in the future as the product information customers use continues to increase.
How does marketing need to change?
Managers, marketers, and business strategists need to think differently about how to reach customers who have access to much of the information they need to make buying decisions on their own. Marketers and sales reps can no longer drive purchases, but instead must work to influence buying decisions using SEO, reputation management, and making quick adjustments to adapt to new situations. Brands should do ongoing content updates on their websites, providing new product information, adding case studies, and showcasing positive reviews. Companies should generate interest in new products through content marketing, including regular website updates, blog posts by product experts, email and public relations campaigns, and link building to improve search results.
Product development teams should get new products into reviewers’ hands as early as possible so they can start providing the online reviews customers seek. Teams should monitor sites for fake reviews and respond to negative reviews with clarifying information as quickly as possible. And, they should be ready to adjust their strategies and even products and services as the market changes.
What are the upsides of this new marketing reality?
With access to real-time information, companies can do quick experiments with their marketing and generate instant results. A new case study based on feedback of new uses of your product that you hadn’t anticipated could yield great results. A shift in where you should focus your efforts means you can spend less time and money on measuring brand perceptions, developing positioning statements, and measuring preferences today, trying to predict future behavior. With product reputation no longer based on previous brand reputation and company history, your company can diversify with new products or into new markets, or if a previous product was not as successful as you’d like, you have a better second chance because past performance isn’t as important.