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How to Deal with a Dysfunctional Market:

As Marketing Professionals, We Can Fix These Challenging Market and Product Problems

by Eric Gagnon

Recently, I wrote about methods for troubleshooting and correcting for low sales response from market tests and marketing projects caused by problems in the marketing program itself—bad marketing deliverables, poor presentation, or poor prospect targeting. As a marketing professional, marketing-related problems such as these are the easiest problems to correct, because their solutions are mostly under your control.

This week we travel into more challenging territory: Poor sales response caused by market conditions. Market-related problems are often far more difficult to correct by marketing alone, and may also require changes to the company’s pricing, business strategy, and changes to the product itself (we’ll cover the marketer’s role in examining and correcting product-related changes in next week’s TMN).

Dysfunctional Market Problems

Sometimes, during a market test or ongoing marketing activity, analysis of results and feedback from prospects and your company’s sales team reveals deeper, market-related problems. Market-related problems are structural problems in your market, and in the ways your potential prospects in that market perceive, buy, and use products such as yours. As marketers, we often encounter situations where prospects in a market refuse to act or behave as we would expect (or want) them to behave.

Counter to what our economics professors told us in college, markets don’t always behave rationally, because people who comprise these markets sometimes act against their own best interests—that is, irrationally. They sometimes don’t pay attention very well. They’re often too attached to the big, leading companies in your business, even when another company like yours provides a better product, or better service. They get too comfortable with their own ways of doing things, even when your “better way” really is a much better way for them.

Marketers run into these market-related problems despite their best efforts to avoid them, through intelligent product development and thoughtful development and execution of the marketing plan.

However, no amount of armchair strategic planning can ever replace actual marketing and live engagement with your market, and this means running ads, dropping mailings, exhibiting at trade shows, and executing the marketing activities that comprise the marketing plan. Deep structural problems with a marketing program often reveal themselves only after the program is executed in the market.

Here are some examples of typical dysfunctional market problems, and ways you can crack these problems to sell your product more successfully into these markets.

Problem: Competitor Lock-In

You may discover that your market is locked up by a few large competitors with long-standing ties to many of the prospects in your market. Prospects are reluctant to make the switch from the larger or better-known incumbent competitor to your company. This is a very common problem for young start-up companies, and especially first-mover companies marketing products using disruptive technologies.

Solution: Go Frontal, or Flank Smartly

Dealing with market problems due to strong competitors who have virtual locks on your market can be overcome either by using strong frontal attacks (direct, named comparison), or smart flanking attacks (positioning against weakness).

Direct, named comparison: When you know you’re up against strong competitors who seem to have a strong, seemingly locked-in position in your market, go beyond presentation of sales benefits in copy for your deliverables: Instead, tell your prospects how your product stacks up against the one they’re using now, and make the case for why your product is better than the one they’re using that’s sold by your leading competitor, by name.

There’s nothing to be lost by going against your competitor directly by name, using tough, hard-hitting sales copy that addresses your specific competitor(s) products, and other elements, such as comparison charts, to highlight your product’s superior features, price, and value against your competition.

Ridicule and humor also works well when you’re addressing what everyone in your business or industry knows about your big competitor’s character, operation, or foibles. Look at Apple’s current TV spots to see how they’re using what everyone already thinks about Windows as a weapon to highlight Apple’s better product attributes (Apple almost makes you feel sorry for "PC Guy," who, not unintentionally, happens to resemble a tubbier Bill Gates).

Smart flanking attacks: An alternative approach to dealing with an entrenched competitor is to focus on the one or two weakest aspects of a competitor’s product or service delivery, and highlight how your product is better than your competitor’s weak spots. It’s critical that these aspects must be perceived by your prospects as being important to their use of the product, and not insignificant product differences. Hit these areas hard in your copy, layout, deliverables, and other sales copy. Make them the focus of every ad headline, mailing piece, Web promotion and other marketing activity in your program.

Every competitor has a weak spot in their operation, or their product—a product attribute that’s made better by your company’s superior technology, a function of your product that’s faster, better, or more productive than theirs. If you’re a small company going up against a gigantic competitor, you can turn this competitor’s size against it, for example, by highlighting your smaller company’s more responsive customer service, or faster, more attentive design and engineering services. Look for what prospects want from products like yours, see what the entrenched competitor is offering to them, highlight those aspects of your product that your competitors are too big or too dumb to see, and give it all you’ve got in your marketing program.

If your conventional marketing test or activity didn’t work against your entrenched competitors, it’s time to go unconventional—and direct comparisons or smart flanking attacks help you change the status quo of your flat sales response. You have nothing to lose.

Problem: Your Product May Be Too Disruptive

Your product may be viewed as being too disruptive to the ways your prospects currently run their operations. Here, being first with a new process, service, or product that requires prospects to change how they’re running their plant, how they’re making their product, how they currently do business with their customers, or any other way they run their business, may be a tough sell.

Yes, your company’s product or service may demonstrate provable cost savings, or may provide substantial boosts in productivity or efficiency. But even with these great advantages, in the real world it can still be hard to change the way your prospects are doing the thing they’re doing, and to get them to do it “your way,” by buying and using your company’s product, service, or system.

Solution: Hide Your Hardware

When introducing a paradigm-shifting product into a market of reluctant adopters, don’t hit your market over the head with the your product’s threatening newness. Here, a marketing program espousing the details of its technical genius scares your prospects; marketing that promotes advantages and “hides your hardware” helps your prospects keep an open mind.

Talk about your product in the way your prospect sees their current problem. Don’t sell your product’s revolutionary new features, which the prospect may see as threatening, or requiring them and their staff to spend time learning or adjusting to a whole lot of new stuff. Instead, sell the quantum increase in productivity or cost savings and—most important—go the extra mile and explain how your prospect will be better off by using your product in their company, job function, or process.

For example, if you were selling your company’s new Web-based, on-demand payroll processing system to accountants who are reluctant to move from their current payroll processing software, you might get better results by presenting the fact that your system requires no stiff annual licensing or upgrade fees compared to the prospect’s current legacy application provider, and tell them how much they will save in this cost alone, instead of promoting your system’s snappy  interface and its hyper-distributed Web 2.0-ish bells and whistles. 

On the productivity side, if you were selling plant automation systems, don’t just talk about improved base unit hardware, plug-‘n-play components, and great reliability, tell your prospect how much money they save by going with your system, through reduced downtime and greater efficiency. If possible, use numbers, percentages, and other quantifiable facts to support these benefits.

Putting some "blood" and reality into your product’s story cuts through the prospect’s complacency and comfort with the way he’s doing business now, and introduces your product as the viable alternative. Do this by giving your prospect both the upside benefits of using your product, and the downside (i.e., the "blood") of not using your product, in terms that are meaningful to them—not marketing buzzwords or clever copy.

After you’ve identified the plausible cause of a poor sales result on a market test or any marketing activity, your ability to make the changes necessary to your marketing program—producing new deliverables and getting those new ads, mailings, and other marketing projects into action—can often mean the difference between recovery or failure in your marketing program.

Once again, this all comes down to your ability to provide effective marketing execution for your company or client, who is relying on you to find the marketing approach that generates the best sales response.

What if your problem goes deeper than basic marketing-related problems, or problems related to a dysfunctional market? Product-related problems are the most challenging sales response problems, and we’ll discuss how to you, as a marketing professional, can help your company address its product-related problems in next week’s TMN . . .

 

Comments? Questions? Send them to me at: eric@businessmarketinginstitute.com

Eric Gagnon (eric@realmarkets.net), a director with the Business Marketing Institute, is author of The Marketing Manager’s Handbook and The CRM Field Marketing Handbook, and president of GAA ( http://www.realmarkets.net ), a marketing, sales turnaround, and product development consulting firm.