Helping Clients Capture The Value of Research: The Role of Marketing and Sales in Their Business

Helping Clients Capture The Value
Of Research: The Role Of Marketing

And Sales In Their Business
Ajay K. Sirsi, PhD
asirsi@schulich.yorku.ca
www.sirsimarketingsales.com
Professional Work
Schulich School of Business, Marketing professor
Research, writing, teaching (Exec, MBA, BBA)
I am not a marketing researcher

I am a marketing consultant
Marketing Led - Sales Driven (Trafford)
Marketing: Real People, Real Decisions (Prentice Hall)
Consulting
Royal Bank
Bayer
International Paper
Glaxo Smithkline
Imperial Oil
Manulife Financial
TELUS
Farm Credit Canada
Schneider Electric asirsi@schulich.yorku.ca
A Recent Client Experience

Firm hired marketing research firm to
segment customer base
End result: Ten customer groups
Sales volume
Cost to serve
Next steps
Profile customers
Customer needs
Helping The Client Think Business

Transformation
What may appear to be a marketing
research problem, is not
Market segmentation will have profound
impact on the entire organization
Customers you keep
Customers you fire
Volume versus profitability discussions
Sales force hiring, training, measurement,
compensation
State Of The Marketing Research Industry

Marketing research industry facing the worst
industry slump since the early 90s
Marketing News
Flat or declining revenues reported by two-thirds

of firms
Inside Research
CEOs put less faith in marketing research than

other sources
ARF
In most companies funding on marketing

research is considered an expense, not an
investment
As individual suppliers we may

have prospered, but as a function
we have failed
Source: Initial thought proposed by Lawrence Gibson in Marketing Research

What Is Wrong With Marketing

Research?
Speed
Bad research
Failure to communicate value
Failure to think strategy
Data providers v. strategy advisors
Not helping marketing function play a pivotal role in
organization
Not recognizing cross-functional impact of research
Systematic gathering, recording,

and analyzing of data about
problems relating to the
marketing of goods and services
American Marketing Association
Value Marketing Research

Provides To Clients
Avoiding failures
Pontiac Aztek
Enabling success
U&A studies
Premium vitamin example
Where Does Marketing Research

Fail?
Helping clients discover opportunities in
the marketplace
Helping clients in transforming the
organization
Source: Modified from Huppertz
10
You Have To Understand Your Clients

Reality
Declining market share

Mature industries
Low-cost competitors
Price sensitive customers
Declining brand loyalties
High failure rate of new products
Consolidating supply chains
Lack of internal customer focus
Cross-functional alignment to understand-createdeliver-manage customer value
11
End State Possibilities

Applying new approaches in sales and
marketing can make a dramatic impact
on the bottom line
Unexploited pricing and marketing
opportunities exist on the order of 5
10 percent return on sales
These opportunities can be captured
quickly
What is the key requirement?
12
Key Requirements
A Focus on the fundamentals
Strong strategies
Marketing Plans
Customer value propositions
Solid execution
Customer-focused Sales Plans
Source: Nohria (2003), Sirsi (2005)
13
Customer Value Pyramid

Financial & Market
Share Impact
Value Elements
Effective management of uncertainty &
volatility
Anticipates change/ innovations
Creates customer solutions/value
Helps customer build a brand
Differentiate
Adopts best practices
Responds to failures &
emergencies quickly
Flexible culture
Marketplace
Agility
On time deliveries
Quality product
Competitive on cost
Basic Care
Source: R. Spradley
Gain
Parity
Decay
14
Transformation from a sales driven company toward a business

system innovator
Stage 1
Profit Potential
rove
p
m
I
Stage 2
Stage 3
s
ilitie
b
a
Cap
Stage 4
Business
System
Innovator
Value
Proposition
Leader
Functional
Excellence
Sales Driven
Intimate
Volume focused
Sell what we make

Feed the machine
Characteristics
Functional
excellence in
Marketing & Sales
Profit focused
Manage customer
and product
portfolios for optimal
profit
knowledge of
customer segments/needs Innovation of new business
systems to meet specific
Focus on value
segment/customer needs
proposition and value
prop delivery systems
Partnerships
Efforts to better meet
Industry-shaping
customer needs, reduce marketing initiatives
cost to serve and beat
competition
15
Source: Sirsi, Marketing Led - Sales Driven (Trafford Publishing)

Marketing Plan
Sales Plan
Manufacturing Plan
HR Plan
IT Plan
Business Strategy
3-5 Year Horizon
High-level strategy
Resource Allocation
Capital Allocation
Budgets
Performance Measurement
KPM (key performance
measures)
16
Marketing Plan Template

External analysis
markets
segments and customers
competitors
Internal analysis: key issues to address

Key objectives to be achieved
Key strategies in place
Key tactics
Key outcomes
Control
17
A Good Marketing Plan Should...
Be a page turner
Make money
Give firm a competitive edge in the marketplace
Provide common direction to all functions
Provide the business with a play book to
approach its markets in a disciplined manner
Provide the foundation for true organizationwide change
18
But, This Has Not Happened

Marketing Plans are encyclopedic
Gather dust on someones shelf
Focus on data, but not on the So What of

data
Do a SWOT analysis, not OTSW analysis
Mainly focus on marketing communications
Managers mistake tactics for strategies
Attend more tradeshows
Business efficiency
My grade for marketing plans: B minus

19
What is the cause of this

problem?
Poor understanding of customers,
marketplace and competitors
20
Segmentation: End State

Premium Performance Value
Entertainment
Software
Manufacturing
21
Segmentation: End State
Entertainment

Needs
Value Drivers
Software
Manufacturing
22
Customer Needs And Value

Drivers
Premium
Performance
Value
Entertainment
High impact product

Willing to pay price
premiums
User-friendly
products
May consider price
premium if case
made
Product
consistency
Will not consider
price premiums
Software
Proactive technical
support
premiums
Quick turnaround
May consider price
premium if case is
made
Basic quality
Will not consider
price premiums
Manufacturing
High grade quality

premiums
Consistent product
quality
Very willing to
consider price
premiums if case is
made
Diversified product
line
Competitive on
price
23
Pivotal Matrix For Marketing

Sales Alignment
Value Propositions
Entertainment
Software
Manufacturing
24
Pivot Matrix: Customer Value

Propositions
Premium
Performance
Value
Entertainment
Grade A product
Dedicated TS
team
Product quality
guarantee
Dedicated TS team
Grade B product
Charge for TS
Software
Grade AA product
Inventory
management
Quick turnaround
Ability to do short
runs
Grade BB product
Sales materials
Manufacturing
Grade A product
Custom solutions
team
Cost containment
Security of supply
Diversified product
line
Competitive on
price
25
How Do Marketing Plans Get Implemented?

Strategic
Marketing
Plan
Sales
Review
Sales And
Customer
Plans
Sales
Implementation
26
Sales Plan
Look and feel similar to marketing plan
Sections lifted from marketing plan
Marketing language translated into

Sales opportunities
Sales objectives
Sales resources required
27
Key Account Plan

Has two sections
Key Account profile
Key Account Sales Plan
Both sections updated yearly (or as

required)
28
We Must Engage the Entire

Organization
Marketing:
Marketing:
Understand
Understand
customer
customer
valueand
anduse
use
value
targeting
inintargeting
andpricing
pricing
and
R&D:
R&D:
Create
Create
differentiated
differentiated
value
value
Sales:
Sales:
Communicate
Communicate
andcapture
capture
and
customer
customer
value
value
Finance:
Finance:
Understand
Understand
costtotoserve
serve
cost
and
and
opportunity
opportunity
cost
cost
Operations:
Operations:
Deliver
Deliver
customer
customer
value
value
Customer focus leads to a comprehensive

business strategy and value-based culture
29
What Does This Mean To Us?
Focus on targeting and positioning

Out-of-the-box thinking
Take time to get it right
Drop the jargon
Quantify the ROI of research
Focus on innovations that truly save time,
not just cut corners
Source: Klancy and Krieg (2001)

30
What Does This Mean To Us?

The problem is NOT one of better
communication
The problem is structural
Encourage students to take courses in
Business strategy
Organizational behavior
Management of strategic change
Industry needs to evaluate proper role

31
What Does This Mean To You?

What business are you in?
Myopic: We are in the business of providing
solid marketing research data
Strategic: We help you think about your go-tomarket-strategies
Cross-functional execution
Need to involve all functions in research design and
data collection
Rhetoric v. reality
Are you really structured to be strategic?
32
You have to move on to the next

project. There is no time even to
check your work. You just hope
nothing fell through the cracks.
Marketing researchers comments
to Ajay
33
Resources
AMA web seminar
www.marketingpower.com/AMA
webcasts/marketing strategy
34
Ajay Contact Information
Website: www.sirsimarketingsales.com
Email: asirsi@schulich.yorku.ca
Phone: (416) 486 8490
Work: Schulich School of Business at York
University, Toronto, Canada
35

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Helping Clients Capture The Value

Of Research: The Role Of Marketing

Schulich School of Business, Marketing professor

Research, writing, teaching (Exec, MBA, BBA)

I am not a marketing researcher

A Recent Client Experience

Helping The Client Think Business

State Of The Marketing Research Industry

Flat or declining revenues reported by two-thirds

CEOs put less faith in marketing research than

In most companies funding on marketing

As individual suppliers we may

Source: Initial thought proposed by Lawrence Gibson in Marketing Research

What Is Wrong With Marketing

Systematic gathering, recording,

Value Marketing Research

Where Does Marketing Research

Source: Modified from Huppertz

You Have To Understand Your Clients

Declining market share

End State Possibilities

Source: Nohria (2003), Sirsi (2005)

Customer Value Pyramid

Transformation from a sales driven company toward a business

Sell what we make

Source: Sirsi, Marketing Led - Sales Driven (Trafford Publishing)

Marketing Plan Template

Internal analysis: key issues to address

A Good Marketing Plan Should...

But, This Has Not Happened

Focus on data, but not on the So What of

My grade for marketing plans: B minus

What is the cause of this

Segmentation: End State

Segmentation: End State

Premium Performance Value

Customer Needs And Value

High impact product

High grade quality

Pivotal Matrix For Marketing

Pivot Matrix: Customer Value

How Do Marketing Plans Get Implemented?

Marketing language translated into

Key Account Plan

Both sections updated yearly (or as

We Must Engage the Entire

Customer focus leads to a comprehensive

What Does This Mean To Us?

Focus on targeting and positioning

Source: Klancy and Krieg (2001)

What Does This Mean To Us?

Industry needs to evaluate proper role

What Does This Mean To You?

You have to move on to the next

Ajay Contact Information

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