How to increase your sale - Prof Palekar's MVG Formula

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Who does not want to increase the sale? 

Here are 71680 marketing strategies - which is yours?

A marketing strategy has 7 elements as follows

1. Target Customers : 8 ways of defining target customers
2. Value proposition : 7 ways of defining your value proposition
3. Locating target customers : 5 ways of locating them
4. Accessing these target customers : 4 ways of accessing them
5. Persuading these target customers : 4 ways of persuading them
6. Transacting with them : 4 ways of transacting with them
7. Servicing these customers : 4 ways of servicing them

By picking one from each of these 7 elements, you will get 71680 combinations. Each of them is a POSSIBLE STRATEGY. Which of this is THE RIGHT STRATEGY FOR YOU ? That is THE KEY QUESTION and the answer is not easy. The question cannot be answered unless you do the most important part of formulating marketing strategy - the situation analysis - Remember 5 Cs ? Company, Customer, Competitors, Context and Collaborators. 

Nevertheless you will feel amply rewarded even if you went through each factor and write down your position against it. It will jog your mind and bring many useful points to the surface of your mind. Spending 30 minutes will be highly useful.  

I am also giving an example for a simple object. A screwdriver. How many different ways can I formulate a strategy ? See at the end of this post.  

TARGET MARKET : This is the most important part of marketing

1. Number of customers 
2. What application they are using the product for
3. What are they doing now for the same application
4. What price point will appeal to them if any
5. Where are they on their "Buying Journey"
6. What are their expectations
7. What is their Decision Making Unit, who are members, roles
8. What are their buying habits 

VALUE PROPOSITION : What value do you plan to create?

1. all applications :
    better marketing mix at a slightly higher price
2. all applications :
   slightly less attractive marketing mix at a lower price
3. Specific application :
   better marketing mix at a slightly higher price 
4. Specific application :
   Slightly less attractive marketing mix at a lower price
5. Specific Customer segment :
   To wean upper end customers away from all competitors
6. Specific Customer segment :
   Slightly less attractive marketing mix at a lower price
7. Which of this value will be created by you
   and the rest by your business partners and channel members

GO TO MARKET :  How to locate, access, pursuade and transact?

Locating target customers :

1. By generating walk-ins at the outlets
2. By prospecting and lead generation
3. By taking appointments
4. By cold calling
5. By channel members

Accessing them

1. through e mails or net
2. through personal contact
3. through mass media
4. through channel members

Persuading them

1. through e mails or net
2. through personal contact
3. through mass media
4. through channel members

Transacting with them

1. through outlets
2. through channel members
3. through direct sales force
4. through portals

Servicing them

1. through outlets
2. through channel members
3. through direct service force
4. through portals

Formulating a marketing strategy for a screwdriver. 

TARGET MARKET : 

1. Number of customers : Almost every household needs a screwdriver. In urban India alone there are 30 million concrete houses and can benefit from a screwdriver. 
2. The application we are targeting is giving a useful gift to males in these houses. The product we have in mind is a screwdriver packed in a box as a gift. It will be priced at under Rs 100. 
3. Currently people give clothes, ties, belts, pens as gifts to males. Our product at Rs 99 will be cheaper than all these items and will be attractive.
4. Since the idea of giving a screwdriver as a gift is new, we will need to make people aware. Currently our product may not be on the "Buying Journey"of our target customers.
5. The expectation of the customer will be a showy and good looking gift box and the screwdriver should look polished and attractive. 
6. A Rs 99 product will be purchased by an individual on his own but since the idea is new the person may cross-check the decision with others. 
7. The buying habit will be from a gift store or department store.  

VALUE PROPOSITION : 

We want our screwdriver to look polished and good. We shall therefore use high quality stainless steel and will make special arrangements to ensure that the product will not have finger marks.  The handle of the screwdriver will be transparent and molded in high grade plastic and will be avialable in different colors. We will design a gift box with a see through window. The box will be very attractive.

LOCATING TARGET CUSTOMERS

We shall rely on our channel members ( gift shops and departmental stores ) to stock, display and recommend our product to all customers who come in to buy gifts for male friends.

ACCESSING TARGET CUSTOMERS

The counter sales persons at the outlets will access the walk-in customers. Attractive displays will be put up on sales counters.

PERSUADING TARGET CUSTOMERS 

Since the pursuation will be done by the counter sales personnel of the retailers, we shall organize a special training program of an hour for such personnel. There also will be an incentive plan for them.

TRANSACTING WITH THE TARGET CUSTOMERS

The outlets have adequate facilities to undertake transactions.

SERVICING THE TARGET CUSTOMERS

There is no need for any servicing arrangements.

What really is the real difference between marketing and sales in practice ?

The textbooks say that sales is a part of marketing. But that is only on paper. As Philip Kotler himself says, the economics and culture of the marketing and sales departments is very different and it is very difficult to get a person to head and lead both the departments at the same time! Actually it gets much more complex than that because the exact job description of marketing and sales varies significantly from company to company and industry to industry. 

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Sales revenue is what keeps the business running and pays us our salaries. Some of the strongest signals that the sales are going to decline do not come from marketing but from the sales force. The sales force is intelligent and they can "smell" how things are going to pan out due to external and internal forces. Savvy businessmen should be able to read these "early signs". Click below

13 sales force indicators that show that your sales will decrease soon

Are you making these mistakes while launching new products ?

The fact is that these marketing mistakes are easily avoided; and yet people make them all the time. Are you sure you too are not committing these mistakes in your own business?

Your new products are conceived 
in a wrong place and in a wrong sequence
Your new product process starts with an "idea" but you forget whose idea is it. Is it your internal idea or is it from an external customer? Unfortunately, many companies start with what they think is good and is based on internal inspiration / reason : it is "the latest", "it can be made on our existing machines", "we know how to procure the main material at a good price", "how can we not have this product?", "we already know the customer so half the job is done already", "the CEO himself likes it" etc.   You should invert this process and start by asking which customer's what need is strong and urgent and this is likely to make you succeed more often. This is called as market positioning. Doing things in the wrong order is delightful but a proper way produces better results. 
 
You treat casual feedback 

from untrained sales force as facts.

Sales people are not always right about what the market wants. Their 3 standard formulas are "improve the product", "reduce the price" and "spend more on promotions".  The sales people are focused on "how to sell more next month and exceed targets"; everything else is secondary to them. In any case, many times the sales people do not get to meet the people who truly influence or make decisions. That is why you should not consider the sales force feedback as undiluted truth. I suggest you put a good salesperson on a team along with  marketing and technical colleagues and (a) train them in the methods of ferreting out facts (b) establish direct contact with the customers.  How to listen to the market is an important skill and needs to be developed in the organization - not as a specialist discipline - but as general skill that is needed widely.
 
Your managers  taking marketing decisions
have no direct contact with customers
Your managers rely on "gut feeling". Your marketing managers think they are the "market" themselves. They conceive new products and services based on books, discussions and fads alone without input from the live customers. Probably your managers avoid complaining customers like a plague. If this is true, you definitely need a develop a "customer culture". You must encourage all in the company to take every opportunity to interact with the customer and learn what are their needs and "pain points" and how do they go about purchasing. One low-cost approach is to train yourself and all of your employees to routinely interact with customers for the explicit purpose of gathering intelligence about their needs or handling their grievances . Sometimes the best information can come through casual comments. Soon you'll begin thinking like your customer - which is the first step in overwhelming your  competitors.

You do not know your business, customer, purpose.
You blindly copy methods.  

There is only one universal truth in marketing  - "KNOW WHO IS THY CUSTOMER AND LISTEN TO HIM";  everything else is situational and need not be done under all circumstances : better product is not needed in all circumstances, lower price should not be the objective in all situations, wider distribution need not necessarily result into better results, you do not need to advertise or promote all the time, you need not appoint dealers for everything. For example, B2B customers tend to be more measured and rational in their approach to purchasing, and they are far fewer in number. They're smart and will make you smarter if you engage them in a peer- to-peer dialogue. Let them lead you to their areas of interest, probe with skill, and you'll be shocked at how much you'll learn. In such situations do not use surveys because they are used by B2C companies selling mass consumption standard products. 
 
You gather only qualitative customer feedback.

The partner of a business spent months interviewing customers, only to hear his partner say that he didn't believe what customers were saying. Managers and owners often hear what  they want to hear and then parade some customer quotes for support. What you need is quantitative data, which measure customer importance and satisfaction on key outcomes. Skip quantification and your new product will be based on assumptions, bias, and wishful thinking. 


You listen only to existing / immediate customers. 

Unlike B2C producers, your product might become part of your customers' products, your customers' customers' products, and so on. It's a mistake to interview only your direct customers, because they are usually unable or unwilling to disclose downstream needs. It is also very important to know why your non-customers are not buying. Or why your competitors' customers are not buying you.