Fortune favours the brave

It's easy to cut back on marketing spend during economical turmoil. There are 3 well known practices for deciding marketing budgets:

• The Economist's view - Supply & Demand. If demand is low, cut back.
• The Accountant's view - Spend as a % of sales/revenue. If revenue is dipping, cut back.
• The Marketers's view - Objective & Task, decide how to increase sales and work backwards.

Why focus on cutting costs, when you can focus on increasing sales?

Much empirical research by PIMS (profit impact of marketing strategy), based on thousands of companies over many years, suggests that companies who invest in marketing an innovation in a recession, come out better. Companies who increase their marketing spend whilst in a recession, whilst competitors are cutting down, are far more likely to be remembered and noticed by consumers when the recovery starts.

You have a company. You are manager. You are a consultant. Whatever you are, you have a database of customers who trust you. Increase your contact with these customers (but don't overdo it!), and remind them of your brand values and why they can shop with you in a recession, perhaps give them a reason, some sort of promotion spend or competition. Keep them happy and pull them through on the other side.

Fortune favours the brave, and those you don't cut the marketing spend await glory.

Customer lifetime value!!!

I'm overdue a blog, and something popped into my mind today...


I'm doing a piece of coursework on the retail marketing strategy of Ikea, and they got me thinking about an interesting topic. Customer lifetime value.


We know the population of the UK is ageing. People are living longer and theres a social demographic shift towards this. First time homeowners are older, and research shows that more people are redecorating their home as an alternative to moving. Ikea are very good maximising customer lifetime. They offer ranges of furniture and homeware for families of any age. And companies such as John Lewis are booming as the only people with money are the older generation.


Companies should use created relationships (which I have been blogging about previously), in attempt to maximise the time that a customer will stay loyal (if there's such a thing) to that brand. Customers who have a relatively young target market should be thinking, 'we have these customers now, but how can we keep them in 5, 10 years down the line'. The population is ageing and yes, this includes your customers! It might be a smart move to keep up with them rather than isolating them.


You can incorporate these ideas into your retention strategy, creating handy segments of customers who are interested in the different products/services you offer. This sort of database management will help you keep contact relevant, keeping everyone happy. The customers you have now, and the customers you still have from before. Sure there might be business growing pains, and some product diversification and extension, and Ikea are a big company, but don't dare to dream!


From cradle to the grave.

Developing relationships with your customers through Facebook

I believe there are 3 simple rules to an effective Facebook strategy for a business/brand/product/service.

• Understand your brand, and the people who relate to it.
• Know the people who are following you, and what they want from you.
• Realise what they find interesting and engage in conversation.

Does this user want entertainment? The likely answer is yes. Although they would not be following brands directly for content it gives them, its likely that decent content will keep them happy and ultimately develop a RELATIONSHIP. This relationship is what brands should be striving for, some level of trust and developed respect for both parties. Its a two way activity. Don't think your followers aren't clever. They don't want to see your promotions straight away, they are in social media spaces to engage in conversation. So give them what they want.


Knowing your target market, and the type of people who follow you on Facebook can allow you to deduce what type of content they would find interesting. For example if we take Natwest Bank again, interesting posts would come in the form of government developments and changes to the way people's money is spent. Basically interesting things in the financial sector. It's pointless for Natwest to be posting about last night's X Factor results. On the other hand, if you're handling the Facebook list for a brand such as an online Bingo brand, it would be in your best interests to post about X Factor or other things you can identify your target market relate to.


There's no rule of thumb, but going into your Facebook strategy gung-ho won't get you anywhere. Think about your brand/product/service and what complimentary industries there are. Think about why prospects and customers are following you in the first place. Think about what they would like to hear about, the stuff they like. Don't expect a Facebook presence to immediately increase your sales, but think of it as an investment into the future relationship you could have with your customers. Don't give them the hard sell and try to push them into parting with their money straight away.


Follow these 3 rules and a relationship will develop, and over time lead to sales and new brand ambassadors, which in my opinion are the most valuable things a business can gain.